95% of goods in Ireland are transported by road, so there is plenty of opportunity for those setting up a trucking business or looking to grow their existing firm. Supply chains for any number of industries rely upon the large network of roads that cover cities, towns and rural areas in every county.
Outside Ireland there are also import/export opportunities, with many local or national firms looking for freight forwarding companies and hauliers to connect them to Ireland.
There are a number of ways in which trucking operates, giving you a choice when setting up your business. You could operate as a sole trader, taking on contracts via a haulier. You could set up as the haulier in question, with a team of lorry drivers on your books to send out on jobs.
Setting up as a self-employed trucker
Many truckers who have been employed by large companies or haulage firms find they can gain more from being self-employed, either financially or to gain better work/life balance. After getting your HGV licence you’ll need to take care of a few areas to make self-employment work for you:
Even though you are working for yourself you still need a business plan, and it can be quite simple. It might be helpful to do a SWOT analysis, so you are clear on your Strengths, Weaknesses, Opportunities and Threats. A self-employed trucker operating in the grain haulage sector might have a SWOT that looks like this:
- Flexible to client’s needs
- Lower overheads than haulage firms
- Lack of resources
- Small amount of capital resources
- Ireland has a thriving road haulage industry
- The country is mainly rural, agriculture is a large industry
- Agriculture is seasonal, need to plan for quiet periods
- Work may be scarce if there is a bad harvest
Along with your SWOT analysis you will need to think about where you will get your business from. Get to know local haulage firms and use previous connections with companies you’ve already worked with. You may also want to advertise in trade press or local newspapers, depending on the cost. Think about complementary industries too – such as the mechanics you use – they may recommend you to their other corporate clients.
Your largest expense could cost anything from €40,000 for a 4-year old curtain slider to around €6,000 to €7,000 for a flatbed. It all depends on what you need it for – you may want to offer refrigerated haulage for the food industry or need a crane truck if you work in construction.
Unless you have the cash from savings you will need to find a loan to make this investment. Talk to your bank, or a specialist heavy goods vehicle finance lender, about accessing finance for your truck. You’ll need to show a business plan and some may require the finance to be secured against your home if you are a sole trader.
Once you have your truck you must consider how much it will cost to run both the truck and your business, and if this matches up with what you intend to charge to clients and haulage firms. Some of your running costs will include:
- Loan repayments from asset finance
- Tax and insurance
- Maintenance and repair
- Food and drink plus overnight accommodation whilst travelling
- Training and HGV licences
- Health and safety requirements.
You’ll need to be clear about what a job will cost you in terms of fuel and other supplies, as well as putting an amount away for insurance, maintenance and taxes too.
You will need commercial HGV insurance to protect yourself, your vehicle and the contents of it whilst you are working. As well as covering theft, loss or accidental damage you will need insurance that covers what you are transporting too. You will need specialist cover if, for example, you are transporting hazardous chemicals or livestock. Look for insurers that are affiliated with the Irish Brokers Association or the Brokers Federation of Ireland.
As you spend long hours at the wheel you’ll need to make your accounts as simple as possible, and as automated as you can. Online accounting software like Sage One can be used via a smartphone to make reviewing accounts easier – great if you aren’t desk-based. There are a number of factors you need to take care of as part of your accounting process:
- Set up a quoting template, to make sending estimates short work
- Set an invoicing date each month, to allow you to have good credit control
- Allow customers to pay via bank transfer or online payments
- Set up automatic reports to alert you to overdue invoices
- Get into the habit of keeping a record of all expenses
- Regularly review your accounts to ensure you are allowing for taxes and other fees.
Managing and setting up a haulage firm
You will have many of the same considerations as a self-employed contractor but on a larger scale.
You will need to access funding or investment to set up your business and this will include vehicles and equipment but also premises as well. Your business plan will need to be more complex and cover staffing costs, projections and plans for growth too.
Insurance will need to cover vehicles and the goods they transport but you will also need public liability and employer’s liability cover for your business too.
Your accounting concerns are similar and you should put in the right processes to manage quotes, invoicing and expenses but also payroll too.
Because your drivers don’t tend to work set hours you will need a flexible payroll system, like Sage Payroll, to allow you to quickly calculate their wages based upon hours worked. Some drivers, if they are contractors, may invoice you instead so you will need to separate them from your payroll.
Sage One Accounting is ideal for self-employed lorry drivers and haulage companies. You are able to choose the level of package you’d like depending on whether you manage a team of drivers or work for yourself. Sage One allows you to do the following:
- Create professional, easy to edit quoting and invoicing templates
- Take customer’s payments online using Sage Pay, they are automatically linked to the invoice
- Record expenses at the click of a button
- Link up Sage Payroll to your accounts – it quickly calculates gross and net wages or salaries including breakdown for taxes and pensions
- Run reports for balance sheets, profit and loss, outstanding payments and payroll
Get your accounts moving in the right direction with Sage One. Sign up today for 20% off every month for 12 months.