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Things You Should Consider Before Investing On Transportation Business

Luxurious Bus for Transport Business


Investing in transportation can be profitable and a good investment innovation, but when it is not properly calculated such could be another money-consuming platform for the investor.

As a new investor, there is a need to ensure that your money is invested in a business with the potential to yield an increase in your capital rather than reducing your capital. The transportation business is one of the businesses that can either make you become rich or become poor if wrongly approached.

For those with the right information and necessary tools, investing in the transportation business can be very lucrative while the reverse could be the case for those with little information and lack the necessary tools.

The major factors that could make the transport business succeed or fail are:

  • The Staff
  • The Invested Capital
  • Quality of Vehicles
  • Unforeseen occurrences

Let us discuss in detail how these factors could affect your transport business.



Good management of the transport business lies on the type of staff employed to run the business. Most business collapse due to poor management. Behavioral attitude towards the job can impact either positively or negatively on the overall outcome of the business.


The Invested Capital

Just like in every business, the overall running capital has a great impact on the profitability of the business. Transport business in a high capital business that runs in millions just as its profitability. To run a successful transport business, you need to have a suitable number of workers, well-planned strategy for spending and operations. Because each operation requires money, for example, apart from buying good and sound vehicles for the business, enough capital must be on the ground to help build or rent motor parks at necessary locations for your commercial vehicles, enough money on the ground for unplanned expenses including car maintenance.

Just like every other business, there is a need to keep substantial capital for the operations of the transport business until it starts yielding enough profit capable of paying for its operational cost.


Quality of Vehicles

The main problem in any transport business is spending too much on vehicle repairs and maintenance due to frequent breakdowns. If you buy vehicles that are not sound i.e. good enough for commercial transportation, you will be spending a lot of money on the maintenance of the vehicles.

For your transport business to survive you must consider buying brand new vehicles and consider using brands with strong vehicles that are the starting point of saving more money for your business growth.

Sometimes, getting used vehicles at a cheaper price may appear good but it could lead to continuous spending on the vehicles while in service and may become a major source of profit leakage in the business. The safest way is to buy new vehicles when it comes to setting up a transport business.


Unforeseen Occurrences

Another major problem of the transport business is the unforeseen occurrences. These can be referred to as those unplanned and unexpected expenses. For instance, the if any of the vehicle clash beyond repair as a result of the accident, a driver run away with your vehicle, one of the vehicles got stolen, imposed fines by relevant agencies, court cases, sudden rise in competition, financial embezzlement by the workers, and lots more.

Unfor4eseen expenses happen to be the hidden termites that have sent many transport businesses out of the road. It could come in many forms and gradually others will start joining until it starts eating more than the business could earn and eventually force the business owner to shut down.

The above factors may not really cover all the things that can make transport business not to survive, but it really touched on the most possible cause.



Now that you have known the challenges ahead, let’s discuss how you can go ahead and set up a simple transportation business and grow like the popular names you are hearing today.

Register Your Business

Registration of a business name is the first step towards setting up a business that has legal backing and officially documented. Spend some money to get all the necessary papers for your business. This will help to avoid molestations and intimidations when your business starts booming.

Business registration involves corporate affairs registrations (CAC), unions’ registrations, and other necessary bodies known to you. Before embarking on registrations you need to meet with someone who is already in the business to give you all the necessary guidelines regarding the unions in your locality.

Define your Routes

Before conceiving the idea of transportation business you are supposed to have certain routes in mind. The routes mean the areas your vehicles will cover in transporting passengers. You can become an intra-state transporter or inter-state transporter, the choice depends on your financial capacity and the quality of vehicles you are going to purchase.

So, define your routes appropriately and use them to make all your plans including necessary registrations.

Buy or Rent Parks

Having defined your routes and obtained the necessary paper works for it, the next thing is to go ahead and get parks for your commercial transport vehicles. Because your routes define where your vehicles will be stopping passengers or goods, you need to either buy space to park or rent an already existing park for that purpose.

Set up your parks

After buying space for a park, you need to put structures on it both offices and car parks should be available in it. However, if you rent an already existing park then go ahead to furnish it and customize it to suit your business brand.

Buy a sufficient number of vehicles

Before making choice on the number of vehicles, make a good market survey and evaluate the number of passengers available on the routes you have chosen, know the possible number of trips you can make per day on those routes, and be able to know how much you could be making per day. Then use the statistics to evaluate to possible survival and booming of the business after set up.

When all the necessary records have been gotten, go ahead to buy the required number of vehicles and position them in the various parks.

Customize your vehicles

After determining the number of vehicles and buying it, you need to print the name of your transport business on the body of the vehicles. This helps passengers to remember you and where to find you, it also helps to promote your transport business to others as the vehicles keep passing through the routes.

Customizing the vehicles also helps drivers to scale through most tough security searches on the road and prevents fraudulent use of your vehicles by the drivers for other purposes outside your business.

Employ Drivers and workers

Experience has does a lot when it comes to driving, getting experienced hands to drive your commercial vehicles is a first step towards prolonging its lifespan.

You can make a public advert for experienced drivers, hire them with a good salary. If the drivers are good people, your business will certainly boom.

The next action is to employ workers who will be in charge of loading, collection of payments, and other duties, these workers work in various parks issuing tickets, loading, and organizing all the logistics activities.

Adopt Safe Practice

Most transport companies now allow payments using POS, transfer, and online booking. This mode of operation reduce loss of money due to workers’ or drivers’ activities.  You can define a very safe and appropriate means of receiving money from passengers such that it will not give more room for loss of money.

Adopt appropriate fuelling means for your vehicles and get standard measurements for each kilometer covered. This will help to know or eliminate cheating from drivers.

Writing your phone numbers on the inside and outside of your vehicles could help you to get feedback from the public and passengers on any abuse on the use of the vehicle.

Embark on promotions and public awareness

With everything already in place, you can go ahead and let the public know about your new business using local advertisements targeted at those traveling through the route. Some of the local advertisements include billboards, sharing of handbills, local radio/television stations, and the use of loudspeakers at the parks, etc.

Every advertisement earns at making the public become aware of the new transport company and specify why the business is unique from the existing one. Sometimes running price discount promo can serve as bait to get new passengers.



Though this post may not have touched all the areas you are expecting, I assume that it has touched some vita areas regarding the transport business and how to set it up.  You are free to add your own opinion or suggestion through the comment section.




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