If you run any kind of transportation business, you are probably keen to ensure that you do so as frugally as possible.
After all, there is no point in overspending, and you want to ensure that you have the necessary resources left over at any one time to be able to expand your business where possible into something even greater. Of course, all businesses need to focus on this process of keeping finances in order to some degree, but the way in which you do it varies form industry to industry and business type to business type.
In this post, we are going to look at a range of tactics you can employ to ensure that you are keeping the financial side of things tight specifically in your transportation business. This should make a world of difference to your finances.
Keeping Legal
There are a lot of regulations in the world of transportation, and if you fail to comply with these, then it is highly likely that that will result in a hefty fine for you and your business. In order to keep your finances on track, you obviously want to avoid such fines as much as possible, and that therefore means that you need to think about how you are going to remain legal at all times in your business. To do that, you need to know about what specific regulations there are and how you are going to make sure that you are following them to a tee.
One of the most important regulations is that of licensing, and it’s one that has a dual purpose for being in this article here. It costs you money to have licenses, but of course it costs much more in fines if you fail to get them, so you are going to have to make sure you budget for them early on.
You need to get licenses before you actually start trading, whether or not anyone has driven anywhere yet, or even if you don’t yet have any vehicles on the road at all. This should be the first thing you do after setting up and registering your business, just to be on the safe side and make sure that you are not going to get into trouble that way. The law are pretty hot on this, so it is hugely important to ensure that you are going to get it right straight away.
But it’s not just about licenses. You will also need to make sure that your vehicles are roadworthy, and that is something else that can take a lot of money to get right. You have to ensure the MOTs are carried out every year, any checks and repairs are made and completed on time, and that you are servicing your vehicles regularly.
That will also save you spending even more money on those vehicles in the long run, as it ensures that you are going to catch any problems early on. That alone is hugely useful, but avoiding the fines you’ll get if you’re driving unroadworthy vehicles might be even more significant. You will probably also have your licenses stripped from you and be unable to trade further, which is clearly not what you are going for here.
You’ll also have to think about monitoring your vehicles. Since the 1st May 2006, all commercial vehicles have to be fitted with a digital tachograph to ensure that you have a constant record of where the vehicle is, how fast it is going and how far it has gone. You will find that to be a useful thing to have anyway, as you can much more easily keep on track with what is happening with your fleet at any one time. But avoiding it will only mean that you are going to get in trouble, pay fines, and also not have great control over your vehicles when they are out there.
As you can appreciate, all of this is stuff that you will want to focus on in order to ensure that you can keep a hold of your money more effectively. But paying attention to the law is not the only thing that you need to do to keep your finances tight in your transportation business.
Sourcing Fuel
One of your absolute main expenses is always going to be fuel, and you need to find some clever ways to reduce your spending here as best as you can, otherwise you can easily end up spending far too much money and ultimately causing some serious problems for your business. One of the smartest ways to ensure that you use less fuel is to get hot on your logistics.
You don’t want your vehicles to be travelling any further than is strictly necessary, so make sure that you map out the routes as best as you can. If you fail to do that right, you will basically be throwing money away, and that is exactly what we are trying to avoid here. By planning your routes out better, you will absolutely be able to use less fuel and therefore spend much less money on that fuel.
Another thing to focus on is ensuring that your vehicles are efficient, and that they do not use too much fuel to drive. The best way to do that is to get newer vehicles, and you’ll find that the extra money you pay for those newer vehicles is generally always going to be offset by how much you are saving on fuel, so it is absolutely the way to go.
You can also try to encourage your drivers to drive as efficiently as possible, as that will make some difference in the long run too. As long as you are frugal and you are aware that the smallest changes add up to make bigger changes, you will find that you can really make an enormous difference this way.
Finally, make sure that you are sourcing your fuel from the right place. Some places are obviously going to be much more expensive than other places, and yet fuel is fuel, so you may as well go for the cheapest. You might find that red diesel is cheaper and easier to buy in bulk, which you should absolutely do whenever you can if you want to save more money. So take these points on board, and you should be able to save a considerable amount of money on the fuel you use in your business.
Insurance
It is a legal necessity to be insured in this kind of business, so you are going to want to make sure you are. But it’s also just the kind of thing that will really help you in keeping your finances in tact. After all, you never know what is going to happen, and you want to make sure that you are as protected as possible should an accident or similar occur.
Insurance is the only way to do this, and you should make sure that you shop around for an insurance policy which is really going to make a huge difference. The relatively little amount that you are going to pay out in premiums is going to be worth your while if you ever have to make a claim, so it is a sensible bet to make in any transportation business.
Take these things on board, and your finances should be much tighter in your transportation business in no time at all. That will mean a brighter future for the business, and for you.
