In simple words, applying for the DOT number and starting your business are strong decisions of life. Especially if you don’t have hands-on experience of stepping foot in the motor industry, applying for this number is going to make you sift through different challenges. For instance, if you have been trying to find out how to get a dot number in texas, you’ve come to the right spot. We will not guide you through the conventional route but enlighten you about some important parts of this industry. Unfortunately, most entrepreneurs and existing business owners know nothing about the DOT number when applying for it. So let’s introduce the concept first.
What is a DOT Number?
DOT, which stands for the department of transportation, is a number that is assigned by the Federal Motor Carrier Administration to commercial vehicles. However, if you don’t have a registered vehicle, you won’t be obliged to this number. Not to forget, every state has a different take on this number according to the weight of the vehicle. Simply put, every vehicle that weighs around or more than a certain amount has to have a DOT number. Here are a few things for you to know when applying for it:
There’s no denying the fact, the first hurdle of any business is to manage the finances. It might take a lot to manage the budget, but don’t let that effort bring you down. Once, you manage to grab the investors, the results will be worth the effort. When you decide to start up this business, you will have to cater for the truck and trailer expense. In simple words, this is going to be the biggest expense in your business. Although most companies prefer to begin with used equipment, it is in your best interest to settle for a new one. Even if you decide to rent the truck, you will always have to worry about keeping it safe.
Structuring Your Business
This is the most important thing you need to consider when applying for the DOT number. When structuring your business, you will have to choose one of the following options:
LLC( Limited Liability Company )
This is the most conventional type of business structure for small businesses. This is because people find it easy to maintain, and their assets aren’t hounded. When you register as an LLC, the local authorities won’t hound you. This means, if your business runs into trouble, you won’t have to cover the finances with your savings.
This is not a safe option because you put your assets at risk by being the only person taking care of the company. In a lawsuit, even your home might be confiscated by the bank to cover the financial loss. This is why people despise registering as a sole-proprietor.
When you decide to set your business as a corporation, your assets get protected; especially if you have plans to broaden the wings of your company, registering the firm as a corporation is the safest option.
Insurance is a Major Concern
Even if you get the DOT number, there is no way you can ignore the trucking insurance. The trucking insurance can easily cost between $6000 to $10,000 in a year. To initiate the policy, you can make a down payment between $1500 to $2500. Secondly, it is important for you to note that an insurance company will not offer you the policy if the drivers have less than two years of experience. Furthermore, if you plan to buy more than a single truck in the first year, even then, your policy will get canceled. Make sure to find the right insurance company before you decide to invest. Sift through the customer reviews to cement your decision.
Who is Applying for the DOT Number?
Although this sounds weird, it is an important thing to consider. Not to forget, there are two kinds of firms that help new business owners in this regard. If you settle for the first one, they will help you get equipped with the DOT and MC numbers. In contrast, the second company will make sure that you get everything you want. They will begin from scratch and complete the entire process. Although they charge more, the services are worth whatever money you pay.