Trucking: company expansion, trucking company, quality drivers


Question
I'm novice to the industry-but i am considering investing or partnering in the expansion of my friends small trucking company(9 trucks so far).  He seems to be in demand - but he is based in a small town and struggles having drivers when opportunity knocks.  I thought that I could invest in him by expanding his operations to a bigger city where there is an abundance of drivers, etc...He has the business structure, entity and client base(but no interest in moving there) - I would supply the capital to staff exactly what he and his wife are doing in this small town but on a bigger scale in a city like phoenix.  He feels he could probably increase his loads at least 40% more than what he is transporting with his 9 trucks, in just a couple of months.   If in essence, this sounds like a good strategy, and assuming we would start off by contracting drivers with their own trucks from the new location, what would the  operations capital requirements be to set up shop (going foreward with this)?

Answer
Dennis, there is no easy answer to your question.  The current driver shortage is national in scope so it may not be any easier to find quality drivers in a bigger town.  On the other hand it shouldn't be any harder so if there is another good business reason to expand, then driver recruiting should not stand in the way.  The real key is to define the type of operation and driver you are looking for.  Some drivers like the long hauls which pay well but seldom gets them home.  They don't mind living in their truck.  Others will accept lower earning for a desirable local job that gets them home every day.  You really need to understand the dynamics of what it takes to recruit and keep good drivers, otherwise high turnover can be a drag on the business.  Here is an article you might find of interest:
http://www.gsa.gov/gsa/cm_attachments/GSA_DOCUMENT/ATADriverShortageStudy05_R25-...
I can't give you specific capital requirements without details of the business, but I would suggest that whenever you add a new location to the business try to keep as many functions as you can centralized, particularly the back office functions.  You want the branch office to operate as lean as possible and create the model for future expansion to other markets.  Hope this helps a little.  Good luck. Jim