Transportation companies have been profitable since people have needed rides, whether that be by carriage, horseback, or today, vehicles like trains and cars. These businesses have been around for centuries because they're profitable, simple to start if you have the capital, and they've stood the test of time.
For this reason, it's never a bad idea to start a transportation business in Virginia. With the right plan, the proper licenses, and filling out the appropriate applications, you can start the process of starting one of these businesses today.
That said, before you jump the gun, make sure you know what you’re doing. The worst thing that can happen is ending up with the wrong license or paperwork, so it's important to learn more about how to start a transportation business in Virginia the right way. The good news? We’re here to help.
Read on to learn more below.
How to Start a Transportation Business in Virginia
Step 1: Choose the Type of Transportation Business You Want to Start
Step 2: Choose a Name and Structure for Your Transportation Business
Step 3: Choose a Registered Agent in Virginia
Step 4: Write a Business Plan
Step 5: Register Your Transportation Business
Step 6: Get the Necessary Licenses and Permits
Step 7: Have the Necessary Insurance
Step 8: Secure Funding and Open Business Accounts
Step 9: Hire Staff and Purchase Vehicles
Contents
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Begin by selecting a unique business name, appointing a registered agent, and filing your Articles of Organization with the Virginia State Corporation Commission, which includes a $100 processing fee.
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What Is a Transportation Business?
A transportation business is a business that allows you to transport goods or people from one place to another. Typically, this is done by vehicles, but you can also have an airline transport business or use trains. However, these are rare.
Overall, a transportation business is a company that provides some type of transportation for people. This might include picking someone up in a car and bringing them somewhere or picking up materials and transporting them across the state of Virginia.
Rental car companies and companies like U-Haul are also examples of transportation businesses but in a different sense.
What Are the Types of Transportation Businesses in Virginia?
There are several types of transportation businesses in Virginia. These types of transportation companies will vary based on what you’re transporting, the vehicles you have, and the market you want to serve. Some examples of transportation businesses in Virginia include:
- Trucking companies
- Taxi services
- Limo services
- Ride-share companies
- Air cargo transportation
- Private air transportation (think private jets)
- Private car rentals or luxury car rentals
- Towing companies
- Non-medical transportation businesses
- Medical transportation businesses
- Bus companies
- Tour companies
Overall, if you can transport the good or person, it’s a transport business.
An Analysis of the Transportation Market in Virginia
Transportation has been a profitable business for many years. In fact, there’s a reason that it’s still one of the most popular business types to this day. That said, it’s important to understand the market before you dive head-first into a transportation business in Virginia.
The good news is that it’s not too difficult to strike gold in the transportation industry because it’s worth a lot of money. According to the Bureau of Transportation Statistics, the industry is worth more than 1 trillion dollars – yes, a trillion with a T.
The industry is also projected to grow as new innovations are made in the industry. For example, transportation via rocketry might be a new industry in the 2040s and 2050s, so there is room for growth in our ever-changing world. Even here on Earth, we still need trucks to transport goods, people to drive others around, and rental companies to help with moving.
Is a Transport Business Profitable in the USA?
Yes, the transport business is profitable in the United States. You can make millions or even billions of dollars with a trucking company or air cargo company. Even taxi companies and limo services can pull in a lot of revenue.
That said, these businesses require capital and planning to start. This means that you have to invest a lot of time and money into them before they become profitable. For this reason, it’s not a risk worth taking for everyone, so keep that in mind.
What Is the Most Profitable Transportation Business?
The most profitable transportation business is a trucking company if you want to work as a contractor as well as an air cargo company. These industries have billions of dollars that flow through them, so getting a piece of that pie isn’t too hard. What’s more, you don’t have to worry about high startup costs because you can start with a single truck or plane.
That said, car hire services and rental companies can make you even more money, but you need to invest more into them to get started. This is because you’ll need more vehicles, dispatchers, physical locations, and drivers. These costs can add up over time, so keep this in mind when choosing the type of transportation business you want to start.
How Much Does It Cost to Start a Transportation Business?
The cost to start a transportation business varies based on the type of business you want to start and how many vehicles you want to start with. For example, you can start a trucking company with one truck, but that one truck will cost you about $250,000 or more.
On the other hand, you can start a taxi-like company with a personal vehicle that might cost you less than $10,000.
What’s more, you need to consider the types of licenses you need to start a transportation business in Virginia. For example, you may need a CDL license, which is more expensive than your standard driver’s license. Make sure you keep this in mind for the most accurate start-up cost.
How to Start a Transportation Business in Virginia
Starting a transportation business in Virginia doesn’t have to be difficult, but you do need to have a plan. The good news is that we’re here to help you, from choosing the right type of transportation business to applying for your Virginia business license. Follow the steps below to learn how to start a transportation business in Virginia.
Step 1: Choose the Type of Transportation Business You Want to Start
There are tons of options to choose from when you’re looking to create a transportation business, so the first step is to find the app type that works for you.
For example, you don’t want to start a non-emergency medical transport, or NEMT, business if your goal is to deliver goods by trucking or other methods. Another example is that you don’t want to start a taxi company if you want to be more luxurious; instead, you’d be better off with a limo service.
Some of the best options to consider when choosing a transportation business include:
- Trucking
- Renting cars out to others
- Delivering food or drinks
- Transporting people
- Non-medical transportation
- Medical transportation
- Moving van or truck or van rental company
Depending on the business that you choose, the method of starting your business might change. What’s more, you should consider emerging markets like bikes and scooters as more people are turning to these options in cluttered cities like New York City.
Step 2: Choose a Name and Structure for Your Transportation Business
The next couple of steps follow general business establishment rules. If you’ve been wondering, “How do I start a small business in Virginia?” we’re here to walk you through it.
After deciding what kind of business you want to run, it’s time to choose the name and structure of your transportation business. We recommend getting started with the name, which you can register online.
Make sure you search for the name and check to see that it’s available. Once you have the name, it’s time to acquire any online domains that are associated with it. Failing to do so can result in people purchasing the domain and offering to sell it back to you for a higher fee.
Next, you have to form the structure of your company. You need to choose between a limited liability company (LLC), sole proprietorship, partnership, or even a corporation – DBA (or doing business as) is also an acceptable option.
While you have plenty of choices, we always recommend forming an LLC for your transportation business in Virginia. An LLC is almost always the best option because it protects you from liabilities that come with transportation, and it separates your personal assets from the company.
Therefore, if you end up getting sued or run into financial problems, you don’t have to worry about dipping into your own money.
Step 3: Choose a Registered Agent in Virginia
If you’ve opted to form your business as an LLC or corporation, the next step is to appoint a registered agent in Virginia. This is a vital step in preparing your Articles of Organization, which are required to officially register your LLC or corporation with the State Corporation Commission.
But what exactly does a registered agent do? A registered agent is a person or business entity designated to receive important documents on behalf of your business, such as tax forms, legal notices, lawsuits, and official government correspondence. In essence, your registered agent acts as the primary liaison between your business and the state.
Who can be a registered agent? The registered agent must be a Virginia resident or a corporation that is authorized to conduct business in the state, such as a registered agent service. If you intend to act as your own registered agent, you must appoint an individual within your company, as Virginia law prohibits business entities from serving as their own registered agents.
For more detailed information on the requirements for registered agents in Virginia, you can refer to Chapter 12, Article 3 of the Code of Virginia.
Don’t forget that to run a business, you need to: register a business entity (LLC is the most suitable option, more details here), obtain an EIN (you can apply online here), open a business bank account (more details here), understand accounting and taxes (more details here), and register a domain and create a website (this is optional, you can do it here).
Alternatively, you can delegate all of this to a registered agent starting from $0 + State Fees and get everything done in 1 day. This can save you time and ensure everything is done correctly, leaving you to focus on growing your business.
Step 4: Write a Business Plan
Once you have everything ready to go, it’s time to write your business plan. Every company needs a plan to ensure that it operates smoothly. Without a plan, your business won’t succeed, and you need to make a plan to show banks or investors if you hope to get any funding from outside companies.
This part of the process can be challenging. As you research the information you need for your plan, what you need to do to succeed with the business should start to make itself apparent.
While you can create the plan on your own, there are plenty of templates available online that you can use. We recommend using a template because it can speed up the process without compromising the quality of the plan.
To start your business plan, these are some factors to consider and include in your plan:
- An overview of the business model you’re going after – an Executive Summary
- An analysis of the transportation market
- What your prices will look like
- How you will get customers
- The vehicles you will use to transport people
- Financial projections and revenue projections
- Expenses
- Insurance options
Depending on your business, this is only some of the information you need to include. In fact, we recommend adding anything else you can think of or working with a professional to push you in the right direction.
Step 5: Register Your Transportation Business
The next step is to register your transportation business with the Virginia Secretary of the Commonwealth. This can be done online on their website, and it helps you secure the trademark for your company.
Ultimately, the information you need to include in your registration often requires you to provide some general information about yourself. This may include your name, phone number, address, and some other details.
However, different types of businesses require different information. For a transportation business specifically, you might need to include information about vehicles you plan on using or other things of that nature.
From there, it’s time for you to apply for your EIN. This is the number you need to pay taxes and notify the IRS of your company. You can do this by going to IRS.gov. You’ll need this number if you want to operate an LLC legally. That said, you don’t need an EIN if you’re working as a contractor. Instead, you can use your Social Security number.
Step 6: Get the Necessary Licenses and Permits
The next part of the process is getting the necessary licenses and permits to operate your transportation business.
Typically, you’ll need more licenses than what you’d need for your average small business because you’ll be transporting people or moving someone’s property. Plus, operating large vehicles may require an additional driver’s license like a commercial driver’s license (CDL), which you can get from Virginia’s Department of Motor Vehicles (DMV).
The business licenses you need for a transportation business vary depending on your needs. These licenses are important but you also need the appropriate licenses to do business in Virginia.
While the state of Virginia doesn’t require any licenses, you’ll need one for each county in which your transportation business will operate. This means that you might need multiple licenses across several cities, so keep this in mind as you expand and choose places to offer your transportation.
There are some other requirements you might have to meet before getting approved for a permit or license. These may include providing images of your vehicles, proof of insurance, and having your vehicles inspected by the required state agencies.
A great example is the requirements for a non-medical transportation business in Virginia. These businesses have to have the appropriate vehicles that can accommodate people with disabilities, as well as a unique license from the Virginia DMV.
Step 7: Have the Necessary Insurance
Insurance is everything when you operate a transportation business. You need to have the right insurance for your company because it can help protect your assets. Insurance keeps your company safe from lawsuits and even protects your passengers or the equipment you’re transporting.
You can get business insurance through business insurance providers that can help with liability protection. You’ll also need vehicle insurance if you plan on operating a transportation business.
You need insurance on each of your vehicles and the type of business you operate may change the type of insurance you need. For example, a non-medical transportation business in Virginia needs to have insurance for Bodily Injury and Property Damage, according to the DMV.
If you operate a trucking company, you may also need to meet additional requirements. For these reasons, it’s important to have the type of business you want to create in mind before you get started.
Step 8: Secure Funding and Open Business Accounts
The last step is to secure any funding you need and open any accounts for your company.
You’ll want to meet with a few banks and listen to what they have to offer because some banks have better credit cards, financing options, and checking accounts with lower fees. For this reason, we recommend spending a decent amount of time on this part of the process.
Accounts aside, you also need to secure funding. If you have to purchase trucks, limos, or taxis, you’ll need to spend quite a bit of money. If you don’t have the money available you can take out a loan from a bank.
However, you can also look for angel investors or venture capitalists to see if you can get the financing you need without having to take out high-interest loans. Make sure you shop around for the best offers and do your best to raise funds if you don’t have any.
Step 9: Hire Staff and Purchase Vehicles
The last step is to get started with the business. You’ll need to hire drivers and dispatchers, and purchase plenty of vehicles.
A great example of this put in practice is what you need to start a non-medical transportation business in Virginia. You’ll need to hire a dispatcher to take calls, a garage or lot to store your vehicles, and professional drivers who can help transport people. Therefore, it’s a more complex business than something like a trucking or tow truck company.
Make sure you consider how big you want your company to be when you start. It’s always better to be over-prepared than under-prepared because people won’t want to use your transportation business again if you can’t follow through the first time.
Virginia Transportation Business FAQ
Have questions about the various types of transportation businesses in Virginia? We have answers for you below. We also have some smaller guides to help you open specific types of transportation businesses in Virginia.
How Can I Start a Transportation Business With No Money in Virginia?
Starting a transportation business with no money is possible in Virginia. However, you might have to limit what you’re transporting if that’s the case.
For example, you’ll need capital to start a non-emergency medical transportation business as well as money to start a general transport business. That said, if you have a vehicle already you can join a ride-share app to start making money by transporting people or food.
You can also apply for a business license and start offering these services without any additional apps or websites but that can make the process harder. It’s also a good idea to consider a taxi business if you’re already a taxi driver.
Make sure you consider all of your options, and in most cases, you’ll still have to spend a few hundred dollars on a business license to get started.
How to Start a Trucking Business in Virginia?
Trucking companies are profitable entities that have been around for a long and they’re a great way to make money in Virginia.
While most trucking companies start out with one truck, you can scale this business until you have multiple vehicles transporting goods for you in the state. From there, you can take your company national. Also, many trucking businesses start with truck drivers, so if you already drive for a commercial company, you should have the licenses you need to get started.
Follow the steps below to start a trucking business in Virginia.
- Write a business plan.
- Register your business in Virginia
- Get your CDL license
- Obtain any permits, licenses, or insurance that you need.
- Get the right equipment and trucks that you need for your industry.
- Secure funding.
Following those steps, along with the detailed steps for how to start a transportation business in Virginia that we provided earlier can help you start your trucking company.
How to Start a NEMT Business in Virginia, and What Does It Cost?
Starting a NEMT business in Virginia is just like starting any other transportation business in the state. However, the upfront costs of starting a NEMT business may be significantly higher than other transportation businesses because of the nature of the work.
Overall, the cost to start a NEMT business varies based on the scope and scale of what you want your business to be. If you want to have one vehicle and be your own dispatcher, you don’t have to pay more than the cost of the vehicle and any licensing, which should be less than $25,000 if you purchase a used van.
On the other hand, if you plan on hiring drivers, and dispatchers, and having software to plan routes, you might have to invest well over $100,000 to start a NEMT in Virginia.
Start a Transportation Business in Virginia Today
Transportation businesses are highly profitable, and there are dozens of options at your disposal.
While there might be unique steps and methods to start different types of transportation businesses in Virginia, after reading this article, you know all of the basics for how to start a transportation business in Virginia. As long as you follow the steps we provided and apply for the right licenses, the rest comes down to your capital and will to succeed
Make sure you plan the process thoroughly and focus on entering the most profitable business options for the best chance at success.