Starting a Haulage Business in Nigeria
Trucking business can also be called haulage business. It involves the moving of goods from one place to another with large vehicles like trucks, tippers, trailers e.t.c. Starting a haulage business is a very good one because it is one of the most needed businesses in Nigeria. Transportation is a very essential factor in any economy, Nigeria’s transport system have grown worse in the past few years, the rail way networks are damaged, and we are left with no option but to transport goods through vehicles.
Haulage business helps in this way to transport goods, heavy materials, equipment from one place to another. Without this kind of business in Nigeria, farmers will not be able to transport the items harvested to places where they are needed, factory and companies will be unable to transport raw materials, so it is very essential in a country like Nigeria because it is meeting a need and solving a problem.
Starting this business is also good because you will definitely find a place in the market. No matter the number of players in the market, if you can make your business unique and focus on your strength, there is surely a place for you. You might be thinking there are many haulage businesses in Nigeria and you don’t have any need to meet again. But I tell you that there are still some needs that are not satisfied that you can satisfy if you eventually start the business.
You might want to ask me that, Can anyone start a haulage business? I would say Yes, anyone can if you have the right knowledge and information you need for the business, it is not about money, if not, I would advise you not to start.
Although haulage business requires a lot of money, that is, it is capital- extensive, yet I do say capital is not the first thing in any business, even though it is very important, yet it is not the first.
STEPS TO STARTING A TRUCKING/HAUALAGE BUSINESS
- Evaluate yourself : This might sound stupid, but this is actually the first thing to do if you want to run a successful business. Let’s ignore haulage or trucking first, before you start any business, you must sit down, evaluate yourself, weigh your strengths and weaknesses and conclude if you really want to start a business. You should ask yourself some questions like, Am I ready to start a business?, Do I have the skills needed to run a business? The capital involved in haulage business is too large for you to misbehave in the business or for you not to be sure of yourself. Apart from the capital involved, haulage business is a very risky business, Although every business have their own risk but there is a high tendency of risk in haulage business.
- IDEA : This is also very important when starting a trucking business. I am very sure you must have seen other trucking business and where they have failed . This is the point where you use your brain to figure out what you want your own business to look like, you must have a business idea. I am very sure you don’t want to run your haulage business the way your competitors are running theirs so there is a need for you to think out of the box of how you can make your own business unique and have an upper edge over your competitors.
- RESEARCH: After thinking of an idea, the next thing is to research on the idea. You need to know about all what haulage entails, read books, get mentors or learn from people that are already in the business. Make research about the market, your potential customers, technologies needed for your business , how your business will be different from your competitors and what will make it different. You must know at least ninety five (95) percent on the haulage business you want to start.
- MAKE IT LEGAL : After making relevant research and gotten answers and feedbacks about your haulage business, the next step is to do it the legal way. This is done so that your idea will not be stolen by someone else. You can hire a lawyer to help you with this stage. The following must be done;
Determine the structure you want your haulage business to operate, do you want to run it alone ( sole proprietorship) or it would be owned by a particular number of persons ( partnership). After determining the structure of your trucking business, you need to give it a name, you have to do your research to know if the name you intend to use can still be used. Then you can proceed to the Corporate Affairs Commission ( C.A.C) to register your business. Get necessary permits and licenses, federal and state tax ID and open a business account where the business money goes.
- WRITE A BUSINESS PLAN : A business plan is a formal written document that contains business goals and how the goals will be achieved. It summarizes the goal of your business. To start a haulage business, you need a business plan which will contain the executive summary that gives the summary of your business plan and also state your vision and mission statement.
Your business plan will also contain a section where you give your company overview, how you intend to run your business, your business goals and everything about your business. The next section contains a clear description of your haulage service, for example, maybe alongside with moving goods and equipment, you intend to do logistics consulting or packaging, it will be included in this section.
The next stage is to analyze your market, before this stage , I believe you must have researched about your market, how your products will compete and stand out, your customers, your competitors. All these will be contained in this section of your business plan. Also you must analyze your strengths, weaknesses, opportunities and threats (SWOT) in this section.
Your business plan will also contain how you intend to sell and make people know about your haulage service, the strategies you have decided to adapt, how you plan to sell, your selling cost, cost of advertising and promoting your business.
The last section of your business plan is where you analyze the financial part of your haulage business, you can hire an accountant to help you with this section. It contains realistic financial information about haulage which contains cash flow statement, projected income statement, balance sheet (statement of financial position ) for the next three or five years.
A good business plan might attract investors to invest in your haulage business so you can hire a consultant to help you draft one.
- GET THE REQUIRED FUND : As stated earlier in this article that haulage business is capital expensive, it is not a business that requires little amount of money to start it. The cost of purchasing trucks alone can finance like three business because of its expensive price not to talk of securing a location, buying necessary machines and so on so it requires a whole lot of money.
As an intending haulage business owner, if you don’t have all the capital required to start, there are other means in which you can get money from, some are borrowing from family and friends, you can also obtain a bank loan, apply an angel investor, or raise money through crowd funding.
Money is very important in a haulage business so you must be ready to spend a lot of money.
- SECURE A LOCATION : Securing or finding a good place to locate your business is not as easy as many people think because you have to consider a lot of factors.
One of the factors to be considered before securing a place for your haulage business is the nearness of the location to your potential customers, your haulage business should be located around or not too far from your customers vicinity.
Another thing to consider is how much it will cost you to establish your business in a particular environment. Social infrastructure and amenities should also be considered, for example, you can’t afford to establish your haulage business in an environment where the road is bad because you know how much it can damage your trucks. You also have to be on the look out for the nearness of any other haulage business to your own.
All of these and many more has to be considered before deciding the best location your business will be established.
- EMPLOY PEOPLE :After securing the best location for your business, the next thing is to employ people since you can not work alone, you can’t be the one driving the trucks and also in charge of money, you need people.
A lot of people think that truck drivers are the only employee that an haulage business needs to hire and he can handle the rest by him or herself. But I tell you that is a big lie, if any haulage business owner tries it, the business will fall and crumble. The relevant employees you need to hire in your haulage business are drivers, the material handlers ( those that will be in charge of packing goods and handling materials, they are also called fork lifts operators), an accountant that will be in charge of the finances of the business, a front desk officer who will always to available to attend to customers, take their order, receive their complaints, answer their questions, and take note of their feedbacks, marketing and sales executive also known as business developer who will be in charge of making the world know about your business, and then a freight packing and logistics manager who will supervise the packing of goods or equipment and make sure it reaches the final destination where it is needed, a warehouse operator who will be in charge of the warehouse is also needed.
This is the stage where you choose the type and kind of people that will work with you. You have to be very careful in selecting employees in this type of business. Haulage business require professional, hardworking, honest and customer driven employee, employees that will work hard to achieve the business’s vision is what you need, especially the drivers. For example, you would not want to give your truck to a driver who is a drunkard or who drives recklessly who can fall off the road wih customers goods or equipment in the truck, this would lead to a great damage to the business. You need a good driver who is honest that you can trust to maintain your truck.
- START RENDERING YOUR SERVICE :After all the measures above have been put in place, then you can start rendering your service, moving people’s goods and equipment and generating revenue. Render services to meet your customers need, your services should be quality and should make your customers happy so that they can continue patronizing you. For your sales to be effective, you have to know what the customers want, listen to them , ask them questions and answer their question, gladly accept feedbacks and act accordingly.
This stage is the stage where the marketing and sales executives need to put in their best to make sure that people know about the haulage business, either by building public profile, writing articles or blogs, online marketing but their job is to bring potential customers to the business.
- GROW YOUR BUSINESS :As a haulage business owner, don’t be comfortable with the state of your business, your business can perform better if you have the mindset of growth. You must grow your business to keep it alive because a stagnant business will be wiped away sooner or later. One of the ways to growing your business is to improve your marketing skills to acquire new customers and retain old ones. You can also grow your business by improving the quality of your service.
In conclusion, starting a haulage business will be an easy one for you if you can follow the steps that are listed above.
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