How to start an expedite business and hit the road

Starting an expedite business is an exciting venture that combines logistical planning and driving skills with business savvy. The expedited freight market is a multi-billion dollar industry, fueled by steady demand for urgent shipments across sectors like manufacturing, healthcare, and e-commerce.

This guide will take you through the practical steps of validating your business concept, securing funding, obtaining necessary licenses, and acquiring equipment to help you launch a successful expedite business in the U.S.

Step 1: Plan your business and validate your idea

Start by researching profitable lanes. Use load boards like DAT or Truckstop.com to analyze real-time freight rates and volume. Look for consistent demand from manufacturing hubs or medical centers. Don't just look for high rates; check the rates for return trips, too.

On those same load boards, see which companies are active on your target lanes. You can also use the FMCSA's SAFER database to check how many registered carriers are based in your area. This gives you a realistic picture of the competition you will face.

Estimate your startup costs

Your initial investment requires a detailed budget. A down payment on a reliable cargo van or sprinter can range from $5,000 to $15,000. Insurance down payments typically run between $1,500 and $4,000 for a new authority, which is a significant upfront cost to plan for.

Also, budget for authority registration ($500-$1,000), equipment like straps and blankets ($500-$1,500), and working capital. Many new operators underestimate cash needs. Since brokers can take 30-60 days to pay, have at least $3,000-$5,000 set aside to cover initial expenses.

• Here are 3 immediate steps to take:
• Analyze three potential lanes on a load board for rate consistency.
• Create a detailed startup budget with high and low estimates for your vehicle, insurance, and permits.
• Research the payment terms and credit scores for five large brokers.

Step 2: Set up your legal structure and licensing

First, choose a business structure. Most new owner-operators form a Limited Liability Company (LLC). This protects your personal assets if the business faces debt or lawsuits. An LLC also offers pass-through taxation, which simplifies your annual tax filings.

With your business name decided, you can register with the Federal Motor Carrier Safety Administration (FMCSA). You will need a USDOT number, which is free and instant, and a Motor Carrier (MC) number. The MC number application costs $300 and takes 2-3 weeks to process.

Once you apply for an MC number, you must file a BOC-3 form to designate a process agent. This costs about $25-$50 through a third-party service. You will also need to complete the Unified Carrier Registration (UCR), which is around $60 for one or two vehicles.

A frequent mistake is a delay in insurance filing. Your MC number only becomes active after your insurance provider submits proof of coverage to the FMCSA. Coordinate with your agent to ensure they file the forms promptly after you get your MC number.

• Here are 4 immediate steps to take:
• Register your business as an LLC with your state.
• Apply for your USDOT and MC numbers through the FMCSA portal.
• Find a provider to file your BOC-3 form.
• Contact a commercial truck insurance agent to get your policy ready.

Step 3: Secure your insurance and manage risk

You will need specific insurance policies to operate legally. The two most important are Commercial Auto Liability and Motor Truck Cargo insurance. Most brokers and shippers require at least $1,000,000 in auto liability and $100,000 in cargo coverage. Do not settle for lower limits to save money.

A policy that fails to meet these minimums will prevent you from booking most available loads. In addition, consider General Liability insurance. This protects you from non-driving incidents, like a slip-and-fall at a loading dock. It adds a layer of financial security for your business.

Find the right coverage and provider

For a new authority, expect annual premiums to range from $15,000 to $25,000. This is a significant part of your operating budget, so it helps to shop around. However, price should not be the only factor. Many new operators make the mistake of using a general agent.

You should work with an agent who specializes in commercial trucking. They understand the FMCSA filing process and can ensure your paperwork is submitted correctly. Consider providers like Progressive Commercial, OOIDA, or Great West Casualty, as they have deep experience with new motor carriers.

• Here are 4 immediate steps to take:
• Request quotes from three insurance agents who specialize in trucking.
• Confirm your policy meets the $1,000,000 auto and $100,000 cargo minimums.
• Ask your agent about their process and timeline for FMCSA filings.
• Budget for an annual premium between $15,000 and $25,000.

Step 4: Acquire your vehicle and outfit it

Your vehicle is your primary asset. A reliable, late-model cargo van or Sprinter is a solid choice. Expect to spend between $25,000 and $40,000 for a quality used vehicle. Many new operators try to save money on a cheaper, older van, only to face expensive repairs and downtime later.

Before you buy any used vehicle, you should get a pre-purchase inspection from a certified mechanic. This costs around $150-$250 but can save you thousands. It gives you a clear picture of the vehicle's condition and potential future issues.

Outfit your vehicle for the job

Once you have the van, you need to equip it. You will need at least ten 2-inch e-track ratchet straps, which cost about $15-$30 each. Two steel load bars run $50-$100 apiece. A dozen moving blankets will cost around $50-$100, and a good hand truck is about $100.

An expedite business does not require a commercial office, so you avoid lease costs. Your main location concern is parking. Check your local city and HOA ordinances, as some residential areas have restrictions against parking commercial vehicles. Secure, well-lit parking is a must.

• Here are 4 immediate steps to take:
• Get a pre-purchase inspection for any used vehicle you consider.
• Price out a full equipment list: straps, load bars, blankets, and a hand truck.
• Compare financing options for a vehicle from a credit union and a dealership.
• Confirm your local parking rules for commercial vans.

Step 5: Set up your payment processing

Most brokers pay invoices in 30 to 60 days. This delay can strain your cash flow when you have immediate expenses like fuel. To get paid faster, many owner-operators use a factoring company, which buys your invoices and pays you within 24-48 hours.

Factoring comes at a cost, usually a fee of 2-5% of the invoice value. An alternative is a broker's "Quick Pay" option. This service also speeds up your payment to just a few days for a similar fee. Always read the terms before you sign up.

Accepting direct payments

Sometimes you might handle a local delivery for a client who pays you directly. For these situations, you need a simple way to take payment on the spot. This is where a mobile payment solution becomes valuable for your business operations.

For expedite businesses that need to accept payments on-site or on-the-go, JIM offers a streamlined solution. With JIM, you can accept debit, credit and digital wallets directly through your smartphone. Just tap and done.

At just 1.99% per transaction with no hidden costs or extra hardware needed, it's particularly useful for collecting payment on delivery for local clients. This rate is often lower than the 2-5% commission other payment solutions or factoring companies charge.

• Get Started: Download JIM app for iOS
• Make a Sale: Type the sales amount, hit sell, and ask your customer to tap their card or device on your phone
• Access Funds: Your money is available right on your JIM card as soon as the sale is done - no waiting for bank transfers

Here are 3 immediate steps to take:

• Research two factoring companies and compare their rates and contract terms.
• Ask a large broker about their Quick Pay option and its fees.
• Download the JIM app to prepare for direct client payments.

Step 6: Secure funding and manage your finances

Find the right funding source

You might want to look into an SBA Microloan. These loans go up to $50,000 and are designed for startups. Another strong option is equipment financing, where the loan is secured by your vehicle. Rates can range from 5% to 15% based on your credit score.

A frequent oversight is underestimating cash needs. Many new operators secure a loan for the van but forget about operating funds. This can put you in a tough spot when you have bills to pay but are still waiting on your first invoice payments from brokers.

Calculate your working capital

You should have at least $10,000 to $15,000 in working capital. This amount will cover your first six months of expenses. Think fuel, insurance payments, maintenance, and other costs that arise before your revenue becomes consistent and predictable.

Open a dedicated business bank account as soon as your LLC is formed. This separation makes bookkeeping much simpler and protects your personal assets. It also presents a more professional image to lenders and clients.

• Here are 4 immediate steps to take:
• Contact your local Small Business Development Center (SBDC) for free guidance on SBA loan applications.
• Get equipment financing quotes from two lenders that specialize in commercial vehicles.
• Create a six-month budget to confirm your exact working capital requirement.
• Open a separate business checking account for all income and expenses.

Step 7: Run your operations and staff your business

As a new owner-operator, you will wear multiple hats. You are the driver, dispatcher, and bookkeeper all in one. Your daily tasks will include finding loads on boards like DAT or Truckstop, negotiating rates with brokers, and managing all your trip paperwork.

Many owners make the mistake of expanding too quickly. Once your business generates consistent profit, you can think about hiring. Make sure you have at least six months of steady income before you take on the costs of a second vehicle and an employee.

Hiring your first driver

Your first hire will likely be a Company Driver. Their main job is to operate the vehicle and manage deliveries. You should look for someone with a clean Motor Vehicle Record (MVR) and a professional attitude, as they represent your business to customers.

Driver pay is often a percentage of the load, typically 25-30% for van expediters. Another option is a cents-per-mile (CPM) rate, which might range from $0.50 to $0.65. Before you hire, you must also enroll in a DOT-compliant drug and alcohol testing consortium.

With a second driver, you can keep both vans moving. A single van can gross $100,000-$180,000 annually. Adding a second van and driver should aim to double that revenue. To track your fleet, you might use software like Motive or Samsara.

• Here are 4 immediate steps to take:
• Master the roles of driver and dispatcher for your own vehicle first.
• Research typical driver pay structures (percentage vs. per-mile) in your area.
• Draft a sample job description for a company driver position.
• Look up the requirements for a DOT drug and alcohol testing program.

Step 8: Market your business and find customers

Your primary source for loads will be freight brokers. Get set up on major load boards like DAT and Truckstop.com. Instead of just bidding on loads, call brokers directly. Introduce your company, highlight your reliability, and ask to be added to their carrier list for your preferred lanes.

Build your reputation with brokers

A common mistake is to rely only on load board postings. This forces you to compete on price alone. To stand out, create a professional one-page carrier packet. This PDF should include your MC number, insurance details, and a W-9 form. It makes you look organized and easy to work with.

Once you complete a few loads for a broker, follow up. A quick email to thank them and confirm your availability for future runs builds a strong professional relationship. Good brokers will start calling you directly with loads, often at better rates than what you see posted publicly.

Develop a direct client base

While brokers provide consistent work, direct freight is more profitable. You can find direct clients by targeting local businesses. Think medical labs, print shops, or small manufacturers that have urgent shipping needs. A simple Google Business Profile can make you visible to local searches.

Approach these businesses with a clear pitch. Explain how you can offer faster, more reliable service than larger carriers for their time-sensitive shipments. Having a direct client or two provides a stable revenue stream that complements your work from load boards.

• Here are 4 immediate steps to take:
• Create a one-page carrier packet with your authority and insurance information.
• Identify and call five brokers who post frequently on your target lanes.
• Set up a free Google Business Profile for your company.
• List three types of local businesses you could approach for direct freight.

Step 9: Set your pricing and strategy

Understand pricing models

Most expedite loads are priced per mile. Rates can fluctuate from $1.50 to over $3.00 per mile depending on urgency and location. For short, local runs, you might use a flat rate. This simplifies billing for clients who need a quick, one-off delivery.

Many new operators only look at the rate per mile, which can be a costly mistake. You should first calculate your all-in cost per mile, including fuel, insurance, and maintenance. If your cost is $0.80 per mile, a $1.80 rate gives you a $1.00 profit per mile.

Research rates and stay competitive

With your costs in mind, use load boards like DAT and Truckstop.com to see what brokers pay on your target lanes. This is your best source for real-time market data. Check rates daily, as they can change quickly. This knowledge helps you negotiate for more.

Your goal should be a net profit margin of 20-35% after all expenses. This means if a load pays $1,000, you want to keep $200-$350 after fuel, wear and tear, and other costs. Do not be afraid to turn down freight that does not meet your minimum.

Here are 4 immediate steps to take:

• Calculate your all-in cost per mile, including fixed and variable expenses.
• Monitor rates on DAT for your top three lanes for one week.
• Set a minimum rate per mile you will accept based on your costs.
• Identify a target net profit margin between 20% and 35%.

Step 10: Control quality and scale your operations

Your reputation with brokers is built on performance. Track your on-time delivery rate, aiming for 98% or higher. You should also monitor your freight claims ratio. A good target is less than 1% of all loads resulting in a claim. These two numbers define your service quality.

Know when to grow

Once your van consistently grosses over $12,000 per month for six months, it is a strong signal to consider a second vehicle. A frequent misstep is to finance a second van without a driver ready. Start the recruitment process as soon as you decide to expand to avoid downtime.

With a second driver, managing operations becomes more complex. Fleet management software like Motive or Samsara helps you track vehicle locations, driver hours, and maintenance schedules for both vans. This keeps your expanded operation organized and compliant.

Here are 4 immediate steps to take:

• Start tracking your on-time delivery and freight claim percentages monthly.
• Set a six-month revenue goal that will trigger your expansion plan.
• Research fleet management software like Motive or Samsara.
• Draft a plan for recruiting your first driver when you are ready to scale.

You have the roadmap for your expedite business. Remember, your reputation with brokers is everything in this niche. Each on-time delivery builds trust and opens doors to better loads. You have done the homework, now go make it happen.

And when you land direct clients, you will need a simple way to get paid. JIM lets you accept cards right on your smartphone for a flat 1.99% fee, no extra hardware needed. Download JIM to be ready.