GMP FREIGHT BUSINESS PLAN

GMP Freight WorldWide is a freight and trucking company that services all 50 states. The owner Manager, has a lot of experience managing businesses in various industries and is more than qualified to handle the day to day operation of the business. GMP’s solid business model is forecasted to reach profitability by the end of the first year. GMP will achieve market penetration by remaining laser focused on the market niche, while fully utilizing strong management and personnel. 

Why Trucking

Trucks are vitally important to U.S industries especially with the rise of ecommerce. According to the measurable share of the economy that trucking represents, the industry directly contributes about 5% to GDP annually. In addition, the industry plays a critical support role for other transportation modes and for other sectors of the economy such as the resource, manufacturing, construction, wholesale and retail trade industries. 

Over 80% of all communities in the US rely exclusively on trucks to deliver all of their fuel, clothing, medicine, and other consumer goods. The trucking industry employs 10 million people out of a total national population of 300 million.

1.1 Objective

GMP Objectives from the first three years of operation include:

• To create a service-based company who’s #1 ambition is to continually exceed the customer’s expectations
• To increase our number of trucks with more investments
• To develop a sustainable, profitable, start-up business

1.2 Mission

The mission of GMP is to provide the customer with the most satisfying shipping experience that they have ever experienced. The company exists to attract and maintain customers. When GMP adheres to this maxim, everything else will fall into place. The company’s services will exceed the expectations of its customers.

1.3 Keys to Success

Keys to Success for the company will include:

1. Maintaining a reputable and untarnished reputation in the industry.
2. Quality care to the company’s customer Service
3. Competitive Pricing
4. Flexible hours of operation

2.0 Company Ownership

The company is a Limited Liability Corporation owned by Richmond Asamoah. The company formed in January 2020.

2.1 Start-Up Summary 

GMP start-up costs include all the equipment needed for a home office. Additionally, there will be legal fees, maintenance and repairs, insurance, truck and auto expenses.

The legal fees are for licences and permits required to operate a freight company, the generation and review contracts.

The home office operations and utilities category is self explanatory.

In order to start with 2 trucks with financing, capital of $50,000 is needed for down payment on the two trucks as well as operational expenses such as fuel and manager compensation. Although down payments on truck and Trailer may vary, I will estimate a $21,000 down payment per truck and $42,000 on two trucks for a start. Since GMP is a start-up, the plan is to kickstart the business with a box truck which doesn’t require driver’s to have a CDL-A license. Information on cost is found on page 8.

AVERAGE WEEKLY AND MONTHLY  INCOME

PROFITABILITY

Based on the tables above, the two trucks would generate $38,700 in revenue and $13,030 in profit per month. Also, with a manager compensation of $5,000, there will be a net profit of $8,030. It’ll therefore take approximately 7 months in order to recoup initial $50,000 investment.  

With the $50,000 recouped, GMP would acquire 3 more trucks before December of 2020 through financing bringing the number of trucks to 5. Below is how profitability will look like in the next 5 years with 2 staff and a monthly salary expense of $10,000 in the 2nd year and beyond.

Amount above does not include state taxes for businesses in Nevada. 

Based on the amount below without any truck maintenance or other expenses, we are looking at a potential 52% ROI at the end of the first year.

BOX TRUCK EXPENSE AND PROFIT

Since the business is starting out with a box truck and eventually acquiring the semi, the cost of equipment is low. A used box truck usually ranges between $30,000 and  $50,000 with all other expenses estimated to remain the same as the semi. The down payment for acquisition of truck is about $10,000 including down payment for insurance. It’s expected that about $5,000 and $6,000 can be generated on the average by way of profit. Below is a projection for box trucks after all expenses.

Box Truck Profits per month

Amount is based on the lowest rate per mile. Rates can be high increasing profitability. 

OWNERSHIP EQUITY

Equity defined here relates to all owners, including Owner Manager. Ownership share in GMP will be based on amount invested.