A Thriving Business - Heavy Transport

This post is about how to start and grow a business in the heavy transport industry

The post will cover what you need to know from research, planning and investment to start-up costs and more. It will also give you tips on how to promote your business online and offline. Finally, it will provide examples of successful businesses in the heavy transport industry, including their success factors.

What You Need to Know About Starting a Business in Heavy Transport

Starting a new business can be a daunting task. One of the most important decisions when considering starting up any enterprise is what type of product or service would best suit your needs as an entrepreneur? There are many options available such as retailing, import/export or distribution. Another option is heavy transport.

In this post, I will share with you what you need to know about starting a business in heavy transport.

Heavy Transport Defined

Heavy transport refers to any type of goods that are very large in size and require specialised transportation methods. This might include construction equipment like cranes, or shipping materials such as wind turbines or engines. When transporting items of this nature it is crucial to ensure its safety from the moment it leaves its origin facility until it reaches its destination. This requires planning and preparation for any eventualities throughout the journey so as not to cause damage or injury to people or property.

Heavy Cargo = Value + Time = Cost

The primary goal of any business is to survive and thrive. To achieve this, all successful businesses understand the importance of carrying out an assessment of the value of the goods being transported and how much time it will take to transport it. This is done by calculating the freight rate which is an accurate measurement of how much your company charges for a certain amount of weight or volume. The following image illustrates how the freight rate works:

Example – Heavy Transport Cargo Weight 100KG x 3 = 300KG x 2 = 600 KG x 1 = 900 KG Total Weight 1000 KG Rate $1.00 per kg $1.00 per kg $1.00 per kg $1.00 per kg = $900 x $1.00 = $900 Total Amout to be Charged

As you can see the total charge for the journey was $900 for 1000 KG which is a pretty standard rate for cargo of that size.

How to Calculate Freight Rate

The freight rate calculation is dependent on the distance and weight of the goods being transported. You have to take into account things such as fuel type, distance travelled, equipment/trucks used, time taken and manpower needed – also known as overheads or operational expenses – in order to determine your initial freight rate calculation. Also make sure you are covering your basic business costs at this point too. This should help to determine your final freight rate.

Here is an example calculation with calculation to help you understand how the freight rate works:

Cargo Type = Steel Beams = 3000KG Truck Used = 26T Semi Trailer Fuel Cost per Litre x Fuel Consumption per Litre = 17.2Litres x 6.5Litres per Hr Total Fuel Cost for Journey = 100Ltr x $1.15 per Litre = $115 Fuel Rate Per KG = [Total Cost of Fuel / 17.2 Litre Truck Used x Fuel Consumption] x 30Min Truck Used x 5Hr Journey = [$115 / 30Ltrs x 17.2Litres per Hr x 5Hrs] $0.4 Total Cost Per KG for the Journey = $0.4 Total Cost per KG for the Journey

Start-Up Costs

The costs involved setting up a business in the heavy transport industry vary from country to country, city to city and state to state. This is because every country, state or city has different start-up costs.

A study conducted by the United States Small Business Administration in 2013 revealed that the average total start-up cost for a new business was $10,585 (in the USA) with over half of the start-up costs going on location rent or lease (48.5%). However, these costs vary greatly from state to state so it is recommended that you contact your local Small Business Development Center for more accurate information about your area.

Start-Up Costs for a Heavy Transport Business

The average start-up cost for a heavy transport business is $425,000 (in Australia). This is just an estimate as every enterprise has different overheads/expenses according to location and size. Before you start your business it is important to do your research on the heavy transport industry and the costs involved so that you make an informed decision. Remember that there are many start-up costs associated with any new business, not just heavy transport.

Here are some of the start-up costs for a heavy transport business:

Start-Up Costs for a Heavy Transport Business

So now that you know what you need to know about starting a new business in the heavy transport industry, let's move on to planning and investment.

Planning and Investment

By now you should have your business plan in place. This will help to inform those you have invested in your project along the way as well as future investors (if necessary). It will also guide you through any pitfalls along the way, giving clear direction for how to deal with each issue.

If you have decided to start your new business on a large scale, look at the market and what you expect from your business the following are some of the investment options you can look at:

Investment Options for a New Heavy Transport Business

Here is an overview of some of the more popular investment options for starting a new heavy transport business. These are recommendations based on talks with other transport entrepreneurs:

$10,000 - $25,000 – This is for basic vehicles that can cover short distances. You would also require equipment such as forklifts and other moving equipment to move this type of cargo. Small trucks with basic trailers work well for this type of cargo.

Conclusion

Starting a new business in the heavy transport industry can be an expensive affair. However, if you are prepared to work hard to gain vital experience and move up the ladder it can be one of the more rewarding careers available in Australia.

Always make sure you weigh up all the options available before making a decision. It is always important to do your research before starting any business. You can do this by discussing your plans with transport professionals and small business development centres/officers in your state for more accurate information about your area or city.

What Are Your Thoughts?

I hope this guide has helped you understand the start-up costs associated with starting a new heavy transport industry business.