Consumer demand is up once again after the disruption of a global health crisis. So trucks are rolling out, going from warehouses to stores and from one state to another, supporting the basic industry. If demand is maintained, it will mean profits for the trucking industry. It makes sense to explore this as a business venture then.
And if you’re coming up empty with financing the business, consider grants for truck drivers.
Truck Driver Grants: What are They?
A grant may not be the first financing option you’d think about because you’re thinking bank loans and lines of credit may be the only ways. But truck driver grants may even be better than a loan since you’re not obligated to pay it back — it’s a grant.
Grants for truck drivers provide truckers who want to start a company or lone drivers to become owner-operators with financing or startup capital. Some grants are privately funded and others subsidized by state and federal governments. Not all grants, however, are specific to the trucking industry because some may be for small businesses that need to purchase trucks to operate.
What Trucking Business Grants Can You Get?
So what grants are available?
The Local Initiatives Support Corporation (LISC)
Not specifically intended for trucking businesses, the Local Initiatives Support Corporations provides grants between $5,000 to $20,000. The LISC prioritizes applications from people of color, veteran- and women-owned businesses and businesses in under-served communities with insufficient access to capital. Eligible applicants must live in a community of 50,000 (or less) people.
The National Association for the Self-Employed (NASE)
The National Association for the Self-Employed (NASE) provides members of good standing with an opportunity to fund the expansion of their trucking business through Growth Grant. The grant offers up to $4,000, helping owner-operators to hire more people, fund marketing initiatives or buy new equipment. So it’s not limited to just trucking companies.
Nav is similar to NASE in that its small business grant isn’t limited to truckers. But the grant is larger at $10,000. The grant is run like a competition, with a first-place winner and runner ups, who receive $5,000. Winners are chosen through votes. Past winners, like Roseland Logistics, have used their grant money to buy new trucks to expand operations.
The USDA Rural Business Development Grant
The U.S. Department of Agriculture helps trucking companies or owner-operators in rural areas improve their business and, in the process, the communities they serve. The USDA website doesn’t specify a minimum or maximum amount for the grant, but it does state smaller grants are given priority.
It provides two types of grants: enterprise and opportunity. The former is meant for small and emerging businesses to do any of the following:
- Technical training
- Acquire or develop land
- Acquire equipment or machinery
- Improve rural transportation
- Capitalize revolving loan funds
The latter, on the other hand, may do any of the following with its grant:
- Develop the economy of a community
- Training for leadership and entrepreneurs
- Do feasibility studies and business plans
- Develop technology-based economy
- Do long-term strategic business planning
The USDA grants are specific to projects that benefit rural areas or towns outside the urbanized periphery of any city with a population of 50,000 or more. So eligible areas apply.
FedEx Small Business Grant Contest
FedEx, one of the biggest names in logistics, has a contest that awards up to $50,000 in grant money. The Small Business Grant Contest is not limited to truckers, helping entrepreneurs get their ventures off the ground or expand operations.
It’s a fierce competition with thousands of entries. Five winners are chosen, with special categories sometimes receiving additional grant money. Special categories are veteran-owned, healthcare, sustainability, minority-owned and young entrepreneur.
Other programs are not just grants for truck drivers to buy a truck; some are specific to the education and training of truckers. For example, the CDL grant is a truck driving license grant that allows people to get through training school with financial aid.
How Do You Qualify for Trucking Business Grants?
For many of the organizations providing grants for trucking companies owner-operators, membership is a minimum requirement to qualify. Some grants are specific to new entrepreneurs or people in the military services, like veterans. Other grants serve to help members of a minority. Such qualifications are meant to provide as much support to people who have less resources and access to funding opportunities.
Grants designed for lone entrepreneurs and small businesses may have a shorter if not easier list of qualifications. So more applications may be submitted, providing better opportunities for truckers.
But in most government grants to buy a semi or any other type of truck, especially with grants that are more than $50,000, you only qualify if:
- You operate in a community with a certain population
- Your revenue and number of employees reach a minimum of $1 million and 50 people
- You must use the grant for projects that will be beneficial to the community
- You belong to a federally-recognized tribe
- Your trucking company serves an under-served community
Most grants have a period when it opens for applications; some are annually and others quarterly. Although the applications, particularly for government grants, can be complex. Fortunately, some, like the contests for small businesses, are easier. Although the period for application tends to be shorter. So it’s important to know about these grant competitions when they are announced.
Funding Your Trucking Business
Trucks are vital to the economy, and with the resumption of commercial activities, demand is fueling the industry once again. Although financing your trucking company or your first semi is the usual way to funding, grants for truck drivers may offer a better option. Why? They’re not a loan, which means you needn’t pay them back. You just have to find the right one.