Be Your Own Boss - Become a Haulage Contractor

At Transmode, we’re always on the lookout for positive, professional and reliable Subcontractors who we can trust to maintain the standards of service we’re known for. With that in mind, we’ve produced this handy guide to help you consider whether life as a haulage contractor could be for you. Haulage and transport are increasingly more important to the economy as online ordering and next-day deliveries become more popular, so there are always things to be shipped!

Why should you become a Subcontractor?

An owner-driver (also known as a Subcontractor) is any person with the skills, licence and vehicle to undertake hire and reward road transport work. Hire and reward is the class of insurance that allows you to legally carry other people’s goods in return for payment. There are many benefits associated with becoming an owner-driver, including:

Control your own schedule – Flexibility is one of the biggest benefits as you can choose your own hours and decide how many trips you want to take and when.
Fuel cost control – Your efficient driving can put more money in your pocket. Working with a company that pays fuel surcharges can help to increase your profit margins.
Define your own success and profit – You are in control of how much money you earn. You are paid a per mile rate, so you can set your own financial goals and do as few or as many journeys as it takes to reach them.

How do you become a Subcontractor?

There are a number of steps you must take if you want to become an owner-driver.

Applying to obtain your operator’s licence

If you want to use a vehicle over 3.5 tonnes plated weight, for the purpose of carrying goods in conjunction with a trade or business, then you need an operator’s licence. You should apply for your operator’s licence at least nine weeks before the date the licence is needed, as this will give the Traffic Commissioner time to make any enquiries. You will have to complete Form GV79, which is available from the DVSA Contact Centre on 0300 123 9000. The completed form, along with the relevant fee, should be sent to the Office of the Traffic Commissioner.

To qualify for a standard operator’s licence, you will have to meet the following requirements:

– Be of good repute and fit to hold a licence
– Have appropriate financial standing to run your business
– Have suitable facilities for maintaining your vehicles
– Be capable of obeying the rules.

Hold a Certificate of Professional Competence

A Certificate of Professional Competence must be held by you or by someone you have contracted to oversee your operation as a regular and involved consultant.

Buy/rent your vehicle and find a place to store it

There are a number of different ways to finance the purchase of your vehicle. You could buy it outright, explore finance deals, buy it on hire purchase, or get an operating lease. All options have their pros and cons, which are worth considering before making a decision. You will also need to find an operating centre that’s large enough to store your vehicle, has safe access and is an environmentally acceptable location.

Find suitable insurance

Haulage insurance is required if you are going to be transporting goods for hire and reward. The level of cover offered by haulage insurance follows the same principles as that of a car insurance policy, with comprehensive, third party, fire and theft, and third-party only cover available.

How should you properly manage your finances?

Making the decision to become an Subcontractor can be a difficult one as there are so many different factors to consider before you take the plunge. As a Subcontractor, you become a business owner, so you will have to take on a number of additional tasks to keep the business operating efficiently. You will need to be aware of the following:

Expenses – You must keep a record of all your business expenses and receipts.
Accounts – Your accounts must be in order and up to date, which is something you may need professional help with.
Invoices and payment terms – You will have to create and send off invoices promptly that contain your payment details and terms.
Taxation, National Insurance and VAT – You need to understand the difference between operating as self-employed or a limited company, as well as the tax, National Insurance and accounting obligations that they bring.

Where can you find support?

Help and support for owner-drivers is available from:

TruckNet UK – an active forum for truck drivers

Road Haulage Association – a professional trade association which represents the interests of road hauliers and provides help and advice

Are you ready to get started?

Take the first steps to becoming your own boss by exploring the resources on our subcontractor page.

Additionally, if you’re looking for a haulage contract, feel free to give us a call on 01394 675 635.

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