July 6, 2023
The imminent declaration of bankruptcy by Yellow Freight, one of the largest freight haulers in the United States, has sent shockwaves across the industry. This unfortunate turn of events has left an estimated 30,000 employees, including 22,000 Teamsters, uncertain about their future.
If you are a former driver for Yellow or affiliated companies, first off, I just want to say I am so sorry. I have just a small taste of what you might be going through. I worked at an organization for over a decade when their governance structure changed all of a sudden and effectively ruined any future prospects at the organization. That turned out to be the kick I needed to decide to focus on my own business full time.
I suspect that many of you might be considering starting your own trucking business, especially now as you might be feeling like you want to control your own destiny in the future and not be subject to bad decisions by leaders. My hope is that many of the Yellow truck drivers will decide to be their own boss and unleash a wave of trucking startups on the industry!
If that is you, let us try to help in a small way.
Over the last decade, we have helped over 1,000 trucking startups create financial projections and write a simple business plan that will help meet the requirements of an SBA or other small business lender so that you can secure some funding to buy a truck and launch your business.
The following tools might help:
- Trucking Business Plan Template – Free
- Trucking Financial Projection Template – use the coupon code “yellow” at checkout to take 33% off.
- Free email and chat support – if you have questions just reach out, we are here and happy to help
Now, onto just a bit more about this really unfortunate situation.
Yellow Freight Bankruptcy: An Overview
The Nashville-based Yellow Freight, also known under the brand name YRC, recently found itself in an untenable financial situation. The company, which has been a significant player in the less-than-truckload shipping industry for nearly a century, was unable to resolve $1.3 billion in debt, in part due to tensions with the Teamsters union and an unsuccessful attempt to restructure the business.
Yellow Freight's downfall was not abrupt. The company's troubles can be traced back 15 years when a series of failed acquisitions led to enduring inefficiencies and escalating financial struggles. Union disagreements over wages and benefits added fuel to the fire, climaxing recently when the union did not approve the company's restructuring plan.
As Yellow Freight's financial struggles became increasingly apparent, customers started to switch shippers, further straining the company's business. Ultimately, Yellow Freight lost 80 percent of its freight, and even a $700 million covid-relief loan from the Trump administration was not enough to pull the company back from the brink. As of March, Yellow Freight had $729.2 million in outstanding debt on the loan.
This bankruptcy marks the biggest failure in the freight industry to date, but it also presents a unique opportunity for the truckers affected by the fallout.
The Silver Lining: Starting Your Own Trucking Business
If you're one of the thousands of truckers left unemployed by this bankruptcy, this may be the time to consider starting your own trucking company. Though this may seem like a daunting task, remember that you bring years of industry experience to the table. Your first-hand understanding of the market, your practical knowledge, and your established connections are invaluable assets.
To help you take this step, we at ProjectionHub are ready to assist you with creating clear, convincing, and detailed financial projections. Having a solid business plan and financial forecasts is essential when seeking funding from lenders and investors, and it is a critical tool for navigating the early stages of your new business.
If you think entrepreneurship is the right next step for you, let us help in any way we can!