Do you want to start a grain business? here is a complete guide to starting a grain shipping business with no money or experience .
Ok, so we’ve provided you with an example of a detailed grain shipping business plan template. We also went one step further by analyzing and writing a sample grain shipping marketing plan, supported by actionable guerrilla marketing ideas for grain shipping companies. In this article, we’ll go over all the requirements for starting a grain business. So put on your entrepreneur hat and let’s move on.
Why start shipping grain?
In life, people always need to transport goods from one place to another. Many business people have taken the opportunity to start their own businesses and they smile regularly at the bank.
As a budding entrepreneur, if you are looking for a business that will ensure you get your investment back, you should consider starting your own shipping company. In fact, you will have to pay to specialize in transporting grain, especially if you live in an area where grain is grown.
Grain transportation is a really profitable business, like any other transportation business, as it requires minimum start-up capital other than the amount required to purchase a standard truck. In most cases, you can rent a truck or even buy a fairly used truck to get started.
The bottom line is that you can start your business on your own and then expand it so that you can own and manage fleets of trucks. If you are interested in becoming a grain company owner, read this article carefully for the advice and industry advice you need.
Start of work on the processing of cereals. The Complete Guide
- Industry overview
… The transport industry, and it is a known fact that industry plays a very important role in the global economy; they provide essential services to the United States economy, transporting large volumes of agricultural products, raw materials, machinery, equipment, mud, stones, building materials and finished products from factories manufacturing or farms to distribution centers or ports, and from warehouses to construction sites.
In fact, heavy trucks are indispensable in the construction industry. In the United States, drivers of large trucks and buses need a Commercial Driver’s License (CDL) before they can obtain a work permit. Freight transportation is regulated by the United States Department of Transportation (USDOT), Federal Motor Vehicle Safety Administration (FMCSA), and Federal Highway Administration (FHWA).
They ensure that drivers and trucking companies comply with safety rules and regulations and that drivers receive special training in handling large vehicles before obtaining their Commercial Driver’s License (CDL).
Statistics show that food and feed, lumber or wood products, and petroleum or coal make up 34.8% of trucks in the United States, and by volume – clay, glass, concrete and stone, agricultural products and petroleum and coal account for 35.6% of freight traffic.
Technological advancements in fields such as computers, satellite communications and the Internet have contributed immensely to the growth of the industry. Advances in technology improve the productivity of trucking companies, help them effectively control their trucks and drivers, and help drivers save time and effort.
The trucking industry is not limited to trailers or large trucks that move goods from one destination to another on interstate highways, but also includes small trucks that help transport small goods in a single city. . In the United States, approximately 66% of a truck’s cargo capacity travels 100 miles or less; Local and regional transport accounts for almost half of truck revenues and is the preferred choice of private carriers.
A local specialty freight trucking industry that transports oil, minerals, grains, gas, frozen foods and more. transportation that requires specialized trailers is a very big industry.
According to statistics, in the United States of America alone, there are approximately 60,852 registered and licensed local specialty freight companies, employing approximately 259,944 people and generating $ 48 billion in industry annually. The industry is expected to grow at 0.8% per year in 2014 and 2021. It is important to note that no company in this sector would occupy the lion’s share of the market.
Starting and running a grain shipping business can be difficult, but the truth is, it can be rewarding at the same time. The advantage of the industry is that it is open to both large investors who can start a business with a fleet of trucks and budding entrepreneurs who can start with just one truck.
Some of the factors that encourage entrepreneurs to start their own grain shipping business are that the business is easy to set up and they can easily run the business as a sole proprietorship (sole proprietorship) while still being generating good income.
One notable fact about this industry is that it is not oversaturated. The fact that farmers have to transport grain and agricultural products from one place to another daily means that there is always a ready market for the grain trade.
It can be difficult to start and run a grain business, but the truth is, it can be rewarding at the same time.
Start of cereal market and feasibility studies
- Demography and psychography
The demographic and psychographic makeup of those who hire grain haulers is not limited to farmers. There is a wide range of business people who are not farmers but who are active players in agriculture and who would also like to use the services of grain carriers.
In fact, the target market for grain processors should include vendors and warehouse operators, retailers who would like to move their grain from one location to another, producers (whose raw material is grain) who would like to move their grain from one place to another. …
So if you want to define the demographics of your grain processors, you have to cover it all.
List of niche grain business ideas you can specialize in
It is important to note that there are no niche ideas in the grain business as this business is a niche idea in the specialty trucking industry.
Level competition in the grain industry
The level of competition in the grain business depends on your location and, of course, the capacity of your truck. If you can manage to negotiate successfully with local farmers or grain traders who are involved in the grain trade in your area, you may face little to no competition. his lead.
For example, if you are the only grain company in you, you may be successful in monopolizing the market for a long time before you start a competition in your area where grain is moved interstate or over rough terrain.
List of well-known brands in the grain industry
In all sectors, there are always brands that perform better or are better perceived by customers and the general public than others. Some of these brands have been around the industry for a long time, while others are best known for the way they run their businesses and the results they have achieved over the years.
These are some of the leading grain shipping and trucking companies in the United States of America and around the world;
- Groendyke Transport
- Reliable companies
- Shaffer Trucking
- PRO Transport, Inc.
- Conway Way Truck Loading
- National Schneider
- Sierra West Express
- Sinclair Trucking Company
- Southeast freight lines
- Fast transport
- Consolidated freight lanes
- Paschall truck lines
- Arnold Transportation Services
- USF Glen Moore
- Knight carriage
- YRC in the world
- Werner Companies
When doing cost analysis and economic analysis for your grain handling business, all you need to do is critically examine these key factors; location, price and promotion. In fact, you will need to regularly review these key factors while doing business. As a grain business owner, you need to fully understand your competitive landscape if you are to truly maximize profits and be at the forefront of the industry.
Note that in this regard, the first thing to consider is the type of truck to buy. With new semi-trailers starting at $ 80,000 and going up to $ 200,000 or more, buying a used commercial truck is a much more economical way for most truck drivers.
The ideal rule of thumb is to buy the best used commercial truck that you can afford. Starting as a freelance truck driver can be financially risky, so you should minimize debt by avoiding truck payments that are beyond your means.
It is important to note that the cost of refueling, servicing and maintaining trucks is one of the most important factors affecting the total cost of transporting grain and should be considered the primary factor determining the cost and economy. analysis.
Start your grain shipping business from scratch and buy a franchise
If you want to start a grain shipping business you have to start out really boring because you can’t buy a grain carrier franchisor unless you want to partner with an existing shipping company.
Plus, starting a grain business from scratch is less stressful than other businesses. In the grain business, you should try to ensure as much as possible an efficient truck, a commercial driver’s license (CDL), and then use all the marketing tools available to you, especially the Internet, when it comes to marketing your services.
Note that most successful grain shipping and freight companies started from scratch and have managed to build a strong brand name. It takes dedication, hard work and determination to be successful in business.
Threats and potential challenges you will face when starting a grain processing business
If you decide to start your own grain business today, this is one of the main challenges you are likely to face due to the presence of established grain carriers or standard trucking companies that also export grain. to your target market.
The only way to avoid this problem is to create your own market. ; focus on local promoters or local suppliers seeking the services of a haulage company or grain shipping company.
Mature markets, bad economies (recession), fierce competition, cost volatility and rising fuel prices are other threats and challenges that you are likely to face when starting your grain haulage business. . In addition to unfavorable government policies, seasonal fluctuations and, of course, the emergence of new competitors in the same place as yours.
Beginning of legal activities for grain transportation
- The best legal entity to use for this type of business
When you plan to start shipping grain, the entity you choose will go a long way in determining the size of the business. You can start your grain shipping business as a limited liability company, limited liability company, or sole proprietorship.
Usually, the sole proprietorship should have been the ideal business structure for a small grain business, especially if you are starting out with little start-up capital and a truck. But if you are looking to grow your business from a single truck to a fleet of trucks, choosing a sole proprietorship is not an option for you. A limited liability company, LLC or even a general partnership will reduce it for you.
LLC training protects you from personal liability. If something is wrong with the business, only the money you invest in the limited liability company is at risk. This is not the case for sole proprietorships and partnerships. Limited liability companies are simpler and more flexible to operate, and you don’t need a board of directors, shareholder meetings and other management formalities.
Here are some of the factors you should consider before choosing a legal entity for your grain business; limitation of personal liability, ease of transfer, acceptance of new owners and investor expectations, and of course taxes.
If you take the time to research the different legal entities that will be used for your grain shipping business, you will agree that this limited liability company is the most suitable, especially if you are planning to become a full-fledged trucking business. You can start this type of business as a Limited Liability Company (LLC) and in the future turn it into a “C” corporation or an “S” corporation, especially if you plan to go public.
Switching to a “C” or “S” company will give you the opportunity to grow your business to compete with the major players in the industry; you will be able to receive capital from venture capital firms, you will have a separate tax structure and you can easily transfer ownership of the business.
Attractive business name ideas suitable for grain shipping
When it comes to choosing a name for your business, you have to get creative because whatever name you choose for your business will go a long way in creating a perception of what the business stands for. If you are considering starting your own grain hauling business, here are a few catchy names you can choose from:
- Farmers Delight® Grain Hauling, Inc.
- Jeff Baden Sons® Shipping Company, LLC
- Green Line® Grain Transport Company, LLC
- Extreme Truckers® Grain Transport Company, Inc.
- Texas Connect ™ Freight Company, Inc.
- Iowa Brothers® Grain Trucking Company, LLC
- Rodney James® Grain Hauling Company, Inc.
- Ferguson Tony Sons ™ Grain Trucking Services, Inc.
- Silver Trucks® Grain Trucking, Inc.
- Farm 2 Port® Grain Trucking Company, Inc.
In the United States and most countries around the world, you cannot run a business without some of the basic insurance policies required for the industry you want to work in. As such, it is imperative that you budget for your insurance coverage and perhaps consult an insurance broker who can help you choose the most suitable policies for your business.
Insurance for your freight business and for you is something you should not compromise on. While you can settle for affordable coverage, you also need insurance that protects your assets. There are many factors that need to be taken into account to keep the cost of your insurance low while still being properly protected. Please note that your driving experience is a key factor in determining the cost of insuring your truck, so it is very important to always follow best practices on the road.
Here are some of the basic insurance policies that you should consider when buying if you want to start your own grain shipping business in the United States of America;
- General liability insurance
General liability insurance, sometimes referred to as third party liability insurance in the trucking industry, covers bodily injury and property damage caused by third parties as a result of / during business activities other than driving trucks. For example, general liability covers medical or legal costs. if a client moves their shoulder when tripping over boxes in your office.
- Freight liability insurance
Transportation liability insurance, more commonly known as primary liability, covers the costs of bodily injury and property damage that you may cause to others while using your truck.
Interstate highways carrying non-dangerous goods are federally eligible for at least $ 750,000 in truck liability insurance. State car dealerships must offer the minimum required by their national laws. Cargo liability policy generally requires that each truck be planned or specified on the policy. Insurance companies will not pay claims if the truck is not scheduled.
- Liability insurance for lack of transport
This particular insurance covers third party damage and injury that occurs when you drive your truck for non-commercial purposes such as personal shopping. If you are involved in a truck accident while not working, the liability for non-automatic transportation is paid by the other person’s medical and property bills.
Please note that this coverage is primarily for drivers hired from the carrier. While they are usually covered by their trucking company’s liability insurance, this policy only applies to business transactions such as shipping, standoff, or maintenance trips. Drivers always need liability insurance for auto insurance. …
- Bobtail Insurance
Bobtail insurance is liability insurance that protects you and your truck when you are traveling on business but not carrying cargo, such as when traveling between jobs. The police pay your legal bills if someone sues after an accident.
Bobtail insurance is often confused with third party liability insurance other than freight. Both cover gaps in liability insurance commonly provided by motor carriers. However, bobtail insurance covers professional driving while non-automatic vehicles are intended for personal driving.
- Physical damage insurance
Personal Injury Insurance covers damage and repairs to your truck caused by certain insured events, including accidents, acts of God, theft, and vandalism. This is not required by law, but recommended for all drivers. Additionally, most lenders require physical damage insurance for financing. All owner-operators need physical damage insurance to protect their investment in their trucks, including rental drivers.
- Truck insurance
Road freight insurance covers your liability for the freight you transport, usually for loss or damage. Coverage is not a legal requirement, but is recommended for all owner-operators and leased carriers. The main triggers for truck insurance are: fire, collision, theft, water damage, equipment failure, impact of freight.
- Workers’ compensation insurance
This insurance is a government-approved insurance policy that covers health costs and lost wages for workers suffering from a work-related illness or injury. Only motor carriers and owner-operators with workers should receive workers’ compensation, but some states may require insurance for business owners in high-risk industries.
According to state law, injuries covered by workers’ compensation generally include: traumatic injuries as a result of an automobile accident, repeated stress injuries during loading and unloading of cargo, illnesses occupational due to exposure to harmful chemicals, etc.
- Confirmation of trailer change
Trailer Exchange Insurance pays for physical damage to someone else’s trailer. This is important for truckers and carriers who regularly negotiate trailer swap agreements.
- Hazmat truck insurance
Hazmat’s truck insurance isn’t always a separate policy or rider, but it should be noted that the transportation of hazardous materials is highly regulated, with federal law increasing mandatory minimum liability coverage to $ 1 million. USA for any trucker transporting hazardous materials such as fuel, chemicals or fertilizers.
- Cargo umbrella insurance
The amount of damage that can be halved means that claims often exceed your truck’s liability limits, making truck insurance coverage valuable coverage. Like other general commercial policies, this policy expands the limits of the underlying liability policies. If the claim is worth more than your other insurance coverage, liability will cover the rest.
- Coverage uninsured uninsured uninsured
Motorist insurance with uninsured and uninsured coverage covers your costs following an accident with another uninsured driver or whose limits are not high enough to cover your damages. It’s also the cheapest blanket, but worth it if you need it.
Protection of intellectual property / trademark
If you are considering starting your own grain shipping business, you generally won’t need to apply for IP / Trademark protection as the nature of the business allows you to run the business without any reason to challenge anyone in court for illegal activity. the use of your company’s intellectual property.
But if you just want to protect your company logo and other documents or software that are unique to you or even the concept of work, you can apply for intellectual property protection.
Do i need professional certification to run a grain handling business?
Other than your Commercial Driver’s License (CDL), you do not need professional certification to be able to own and operate grain vehicles in the United States of America.
List of legal documents you need to run a grain cargo business
The essence of having the required documentation in place before starting a business in the United States of America cannot be overstated. It is a fact that you cannot successfully conduct business in the United States without proper documentation.
If you do, it won’t be long before the long arm of the law catches up with you. Here are some of the basic legal documents that you are expected to have in your possession if you want to legally operate your own grain business in the United States of America;
- Business and liability insurance
- Registration of a commercial vehicle driver for heavy goods vehicles
- Appropriate driver’s license for drivers (Commercial Driver’s License (CDL)
- Assistant licenses for assistants
- Sanitary inspection certificate
- Proof of ownership, correct identification and license of the vehicle
- taxpayer ID
- Fire certificate
- Registration certificate
- Business license
- Business plan
- Non-disclosure agreement
- Employment contract (letters with proposals)
- Employee manual
- Operating Agreement for LLC
- Insurance policy
- Apostille (for those intending to work outside the United States of America)
Finance your grain transportation
Starting a standard grain hauling business can be profitable, especially if you already have your own truck. Keeping trucks safe is part of what consumes most of your startup capital.
When it comes to business financing, one of the main factors to consider is writing a good business plan. If you have a good, achievable business plan document, you may not have to work alone before convincing your bank, investors, and your friends to invest in your business.
Here are some of the options you can explore when looking for seed capital for your grain business;
- collect money from personal savings and sell personal stocks and property
- collect money from investors and business partners
- Sell shares to interested investors
- Apply for a loan from your bank
- Submit your business idea and apply for business grants and seed funding from government, donor organizations and angel investors
- Source of loans on favorable terms from your family and friends.
Choosing the Right Location for Your Grain Shipping Business
Grain transportation can be started anywhere you choose as long as you have access to a good road network. In fact, most grain shipping companies run home-based businesses, especially if they have good parking space in their compound.
But if you want to start a standard grain shipping business with a fleet of trucks, it’s important to note that a well-located business center doesn’t come cheap, so you should be able to put it aside. sufficient funds for rental / rental of packing space within your budget.
If you are new to the dynamics of choosing a location for your business, you may feel free to speak to a business consultant or real estate agent who fully understands the city and possibly the country in which you will be starting your business. . grain business.
Starting a grain business Technical and personal data
When it comes to a standard grain business, you will need at least a forklift and other related equipment to help you get your job done. It is important to clarify that this truck and equipment can be purchased fairly if you are using a small budget.
When it comes to choosing between renting or leasing a facility for your grain shipping business, the size of the business you want to start and your overall budget for the business. should influence your choice. If you have enough capital to run a large enough business with enough parking for your trucks, you should consider a long-term lease or purchasing land with full rights.
In terms of expected number of employees To start a business you don’t need to hire anyone, it’s a business that can only be run by the owner. The owner can act as a driver, marketer, accountant and logistics manager.
But if you want to run a standard grain shipping business, you should consider hiring a manager (you can fill this role), logistics manager, truck drivers, accountant, sales managers and manager. marketing (maybe a freelance writer). ) and a customer support manager.
It will take around 10 people to effectively run a small, standard grain haulage business. Note that sometimes you will need to hire workers to help you load and unload your trucks, as well as experts to help you manage certain functions, such as servicing, repairing, and servicing your truck.
If you are just starting out, you might not have the financial resources to keep all the professionals who are supposed to work with you, so you should consider partnering with an industry specialist.
Grain Transportation Company Service Delivery Process
Usually, when a grain shipping company is awarded a grain shipping contract, it first performs a cost analysis to determine the number of trucks, manpower and resources required to make work. After completing the cost analysis, they will deploy the necessary manpower and trucks to do the job and then get paid after successfully completing their job.
Opening of a grain transhipment company. Marketing plan
- Marketing ideas and strategies
The fact that the barrier to entry to starting a grain business is low means that there will certainly be more players in the industry no matter where you choose your location. You must innovate if you need to create a market for yourself within the market available in your community, city, state, or country.
Here are some of the platforms you can use to promote your grain shipping business. ;
- introduce your business by sending cover letters along with your brochure to farmers, grain traders and producers who use grain as part of their raw material, including in the United States
- Quick participation in calls for tenders for grain transport contracts
- Advertise your services in community newspapers, local TV and radio stations
- List your businesses and services on yellow ad pages (local directories)
- Take advantage of online opportunities to promote your grain shipping business
- Do direct marketing and sales
- Encourage the use of word of mouth marketing (referrals)
- Use Internet Resources to Promote Your Business
- Join local chambers of commerce and industry around you for the primary purpose of networking and marketing your services; Most likely, you will receive referrals from these networks.
- Use the services of marketing managers and business developers to do direct marketing for you.
Factors to Help You Get the Right Product Rating
One of the key factors that will help you to offer your grain transport services at a very attractive price is to make sure that you are receiving your start-up capital from sources that will not pressure you or exert interest rates. high interest.
Another strategy to help you provide your grain handling service at the right price is to minimize operating costs and focus your efforts on marketing and promoting your brand. Besides the fact that this strategy will help you save on costs, it will also help you get the right prices for your services.
You can also try to work with independent contractors and marketers as much as possible to help you save on sales and marketing costs.
Possible competitive strategies to win over your competitors
The trucking industry is a competitive industry and you need to develop a unique and highly creative strategy to be able to outsmart your competition in the industry. Part of what you need to do to stay competitive in the industry is to continue to create easier, cheaper ways to transport large amounts of grain for your customers.
To stay competitive in this industry, you need to make sure your road trains are always on time and running flawlessly without accidents or complaints. The truth is that in the event of hesitation and delays in the services you provide, customers can switch loyalty and accept other available options.
Possible ways to increase customer loyalty
When it comes to business, no matter what industry you decide to pitch your tent in, one of the easiest ways to increase customer loyalty and possibly attract new customers is to get results and always satisfy your customers. If your customers are happy with the delivery of your products and services, they are unlikely to be able to find alternative service providers.
Statistics show that one of the main reasons customers choose alternative service providers is a decline in quality. Another reason is poor customer service.
One of the strategies you need to use to generate repeat sales with your customers and keep them coming back is to make sure your truck is always on time and your customer service is not hesitating. The truth is, if your services and customer service are hesitant, you will probably have a hard time getting your customers back; people generally go for good quality products.
Make sure you offer incentives to your customers if you want to retain them and of course continue to get repeat sales from them and attract new customers.
Part of what you need to do to achieve this is to track progress, results or results with the goal of improving them quickly depending on the situation. When it comes to managing your customers and building customer loyalty, you need to buy custom CRM software.
With a personalized CRM system, you can easily keep in touch with your customers (you can do quick surveys, you can submit new products and their prices without any difficulty, you can congratulate them on their birthdays and other anniversaries, you can follow their successes, you can send personalized SMS and emails, and most importantly, you can easily receive information and feedback from them).
Strategies to increase your brand awareness and create a corporate identity
If you are in business and do not intend to build awareness of your brand and convey your corporate identity, you must be prepared to accept what the company means to your business. One of the secrets of big companies is that they spend a fortune to increase their brand awareness.
If you are intending to start a grain shipping business, you want to make it a standard trucking business with a fleet of trucks transporting grain to the United States and Canada, then you should be prepared to spend some money. money to promote and market your brand.
Here are the platforms you can use to build your brand awareness and brand identity for your grain business;
- Advertise on both print media (newspapers). and magazines) and electronic media platforms
- sponsor relevant social events / programs
- use on the Internet and social networks such as; Instagram, Facebook, Twitter, YouTube, Google +, etc. To promote your business
- Install your billboards in strategic locations in the city or state
- Distribute flyers and flyers to targeted areas.
- List your grain business in local directories / yellow pages
- Promote your grain business on your official website and use strategies to help drive traffic to your website.
- Make sure to wear your branded shirt and your truck is well branded with your company logo