A written business description is a component of a business plan. Your business description tells the key people in your business life what you want them to know.

Expediters are often approached by truck drivers and others who ask about expediting. Commonly-asked questions include; “How do you like working for that carrier?” “What do you haul in that truck?” “Are they keeping you busy?” “There is quite a bit of sitting in expediting, isn’t there?” “Can you make any money in a truck like that?” “When you are on a load, do they pressure you to break the speed limit to get it there fast?” “Do you have to get your own health insurance?” “How often do you get home?” “Does the wife drive too?” “Do you go all over the country?” and, “How much does a truck like that cost?”

Expediters quickly develop stock answers to such questions and rattle them off almost without thinking. If you develop your answers a bit further, they become the stuff from which your formal business plan can be developed.

While only a handful of people will read your business plan, they are important in your business life. They include the banker or finance company officer who lends you money, family members who need to understand your business and know what to do if you are no longer around; an attorney who may be helping you with a contract or injury claim, your accountant and perhaps the handful of insurance agents you are interviewing as you shop for something better.

Notice that none of these people drive a truck for a living. They live at home and work at the same address most days. Expediting is as far removed from their life and work as just about anything can be. The only thing they will understand about your business is what you tell them. For that reason, it is important to describe your business well.

If you tell your banker that you drove to Orlando, Memphis and then home, thoughts about Disney World and Graceland may enter your banker’s mind. Vendors who specialize in serving truckers have a better idea about the scale stops, shipping papers, freight securement, fuel purchases, taxes, permits, log books and everything else involved in such a run; but they still live at home and work at the office. They simply don’t know what you know about your life and work on the road.

There are some business service providers that understand trucking better than most. But to support you best, they have to understand your business. For example, if you turn down an above-average number of loads to stay in a certain region, your business advisors might see that as a red flag and coach you on that issue. If you tell them you are turning down long loads because a family member is ill and needs you close to home, those same advisors and perhaps your carrier can help you optimize your regional freight opportunities.

A written business description is a component of a business plan. Your business description tells the key people in your business life what you want them to know. It also tells them what they need to know to best help you succeed.

Describing your business in writing forces you to think things through that you otherwise may not. It gives you better information which you then use to accurately understand and improve your business circumstances.

In September, 2006, the expediting company FedEx Custom Critical, announced a new compensation schedule for its contractors. A flurry of driver-to-driver conversations followed as contractors tried to figure out if the new schedule helped or hurt them. Those who had good business information could figure it out easier and more accurately than those who did not.

In July, 2006, Panther Expedited Services shocked their truck owner-operators when Panther announced it had purchased another expediting company, Con-way Expedite and Brokerage. The Con-way expediters were shocked too. A flurry of driver-to-driver conversations naturally followed as the affected expediters tried to figure out what this surprise industry development meant for them. Again, those who had good business information could figure it out easier and more accurately than those who did not.

Business descriptions vary with the kind of business being described. On Wall Street, for example, some business people earn money by selling things that exist only on paper or in other people’s minds. Explaining a business based on intangibles is a challenge. Someone not grounded in that world would probably find Wall Street business descriptions difficult to understand.

More down to earth are businesses like bowling alleys, restaurants, dry cleaning stores and construction contractors. With these, it is easier to see what is being sold, who is buying it and why. Nevertheless, business descriptions for these businesses can be quite complex.

These businesses must explain the markets they serve. If you are a construction contractor, why do you build homes instead of apartment buildings? Why do you build in one part of town and not another? If you own a restaurant, why do you serve Italian food instead of Chinese?

A host of other topics must also be addressed. If you own a dry cleaning shop, how big will your building and parking lot be? What kind of equipment will you own? Where will you locate? If you have employees, how will you find and pay them? If you don’t, who will run the store when you are away? If you own a bowling alley, what will keep a bigger and better one from appearing on the vacant land next door and ruining you?

Single-truck expediting is even more down to earth. We drive trucks and haul stuff. Unlike most other truckers, we can move freight very fast and/or with great care that others do not provide.

Expediters worry about hijackers, but not like merchants worry about shoplifters. Location worries can be easily resolved by driving your truck someplace else. Unlike construction contractors who must think long and hard before committing money and equipment to a project, one-truck expediters do not have to do an elaborate analysis to decide what kind of truck to acquire. The decision to drive a van, straight truck or tractor/trailer is as much a lifestyle decision as it is a business decision. For most one-truck expediters, the truck-type decision is made in the gut and the business is built from there.

What should a one-truck expediter’s business description include? One would think that question could be easily answered by looking at descriptions of other businesses. Sadly, it is not that easy. If you survey books and articles about business planning, you will find a bewildering range of expert opinions about what should or should not be included in a business description. In this series, we’ll use peoples’ questions about expediting as a start.

When a non-expediting truck driver asks an expediter, “How do you like working for that carrier?” the driver already knows what a carrier is. Your banker and key family members may not. Thus, your business description should describe your carrier and the relationship you have with that company. That would include your business form (proprietorship, partnership, corporation) and your carrier’s place among its competitors (called a competitive analysis in a business plan).

When asked, “What do you haul in that thing?” expediters usually describe the kind of freight they haul and who they haul it for. If pressed for more information, they will explain why shippers pay more to put their freight on their expediting trucks. In business planning, such a statement is known as a value proposition.

If you are visiting with another trucker, both of you know exactly what you mean when you say, “my truck.” That will not be the case in a document that will be read by people who may never see it. While you call it, “my truck,” a banker calls it a business asset. While you think about how it rides, a banker won’t. Bankers think about the money you make with the truck. In their world, it’s called return on assets.

Your ROA is not just of interest to your banker. It is important to you too. It tells you if your money is best spent on a truck or invested someplace else where a better return can be earned.

A banker probably has no idea how good it can feel to have lots of chrome on the truck. He or she will immediately understand that the more you spend on chrome, the lower your ROA will be. Without a business plan, you may not realize how money spent on chrome impacts your ROA and several other indicators of business health.

“Are they keeping you busy?” is a question about current market conditions. In a business plan you will say more than, “Yes.” or, “Most days they do.” You will provide numbers that tell your plan readers exactly how busy you are today, how busy you expect to be in the future and what you base that on.

“There is quite a bit of sitting in expediting, isn’t there?” If you are talking to a truck driver, you’ll explain that sitting is part of the game and you better be good at it if you want to succeed as an expediter. You’ll talk about sitting in your business plan too but in a different way. In your plan, you will describe the fixed costs you have whether you sit or move (truck payment, insurance, etc.), and how you will pay them if there is no freight to haul.

You can see where this is going.. Every time someone asks you about your business, you offer a partial business description. You already know much of what will be said in a formal business description. The trick is to say it in words a banker will understand and in great enough detail to answer a banker’s questions.

If your fortunate enough to not need a truck loan, a written business plan that would satisfy a banker is still a good thing to have. There is no better way to understand your business and make good decisions.

“Can you make any money in a truck like that?” This is a question about revenue potential. In a business plan, that is discussed in the pro forma (projected) statement of income and expenses. We will discuss pro formas in detail later in this series.

“When you are on a load, do they pressure you to break the speed limit to get it there fast?” This is a question about safety and compliance. Safety is discussed in the risk analysis or risk management section of a business plan. If you are injured or your truck is damaged in an accident that occurred because you drove tired, how will you stay financially afloat if you can’t drive for several months? Other risks are discussed too; like mechanical breakdown, family emergency, loss of the truck by fire or theft, the risk that your carrier may go out of business, negative developments in the economy and more.

A question expediters sometimes ask other expediters is about a carrier’s fleet size. The risk of fleet over-expansion will be discussed in the plan’s risk management section. If business slows and your carrier has more trucks than needed, your expediter colleagues are also your competitors. Your plan will discuss how you will differentiate yourself from them in your carrier’s eyes and thereby increase your likelihood of success.

“Do you have to get your own health insurance?” That question takes you straight to the self-employed, independent contractor status most one-truck expediters enjoy (or struggle under). Your status as a proprietor, or perhaps as the owner of a small corporation, is discussed in your plan. Most expediters know why they are proprietors or owners of small corporations. If you are unsure which is best for you, you will be sure by the time you complete your plan.

“How often do you get home?” Some expediters go home every month, others just once or twice a year. Your home-time and personal deadhead decisions affect your income and expenses. They will be discussed in your plan.

“Does your wife drive too?” If you have a co-driver (spouse, significant other, or paid co-driver), your available driving hours are doubled because you are working as a team. That additional capability will be cited in your plan as an advantage. How the revenue is distributed between the co drivers is another issue that will also be discussed in your plan.

“Do you go all over the country?” Some expediters do and some do not. In your plan, you will describe what areas you cover and why. You will discuss the strengths and weaknesses of driving nationwide or in a limited region.

“How much does a truck like that cost?” That is an easy question to answer. Your business plan will also help you answer a more important question, “How much truck can you afford?”

While the commonly-asked questions about expediting got us started, some of the topics above, like risk analysis and pro forma statements, do not go into the business description of a business plan. There are other places in the plan for those.

The next part of this series will provide a business plan outline, developed especially for one-truck, self-employed expediters, into which you can sort the business information you already know. Your words can then be translated into banker language and further developed where needed.

Until then, spend some time thinking about the business questions you regularly answer. What do you say when people ask you the above questions? What more can you say if pressed for more information? If you have not already done so, start a business plan file.

As they come to you, jot down the thoughts and words that describe your business. Helpful phrases include, “I’ll never drive a cab-over truck again.” “We try to get home six times a year and always on our birthdays.” “Our next truck will have a bigger sleeper.” “I run legal.” and, “If I don’t get a load within 24 hours of delivering my last one, I’ deadhead to a busier area.” While such words sound like casual trucker talk on the surface, they will become very significant and informative when you plug them into the upcoming expediter business plan outline.

Until then, remember that writing a business plan can be an overwhelming project, especially for someone who has never done one before. It is OK and quite natural to feel overwhelmed. Don’t let that get you down. This is a step-by-step series. You can take all the time you need to figure things out and see the project through.

Also remember that writing a business plan is more like putting together a puzzle than building a house. Work on the easy pieces first. Let the more difficult pieces set. They will become more manageable as the easier pieces are put in place.

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Phil Madsen is the Senior Field Editor with Expediters Online. He and his wife Diane are a straight-truck expediting team. In 2003 they left their white collar careers and became expediters to increase their income, simplify their lives, spend more time together, share a business project, and see the country. They are pleased to say, “It’s working!” Phil can be reached at [email protected].