The Road Less Traveled

I believe it is the spread axle on the 53ft trailer that will put you over length. Its one of those things that usually does not get enforced but then at random times someone will get a ticket for it. If I find a 53 spread that I like it will open the door for a few more loads but not so many that it would make much of a difference in my projected revenue numbers. The good news is I can buy a yearly permit in Florida and I dont think its very expensive.

 

Good News Bad News

Ill start today with where I am at with becoming an O/O. I have been researching information on this for well over a year. Actually pretty close to two years. Others may not need as long to get to this point but this is Florida and if you are in trucking you know freight rates in Florida are, in a word, terrible. If you are planning to becoming an O/O and starting research I can tell you now that the most difficult piece of information to get real numbers on is freight rates. Drivers will tell you how much they make or how well their favorite lane pays but you have to take that with a grain of salt. I like the idea of staying positive but its the negatives I want to learn the most about early on so that I can try to anticipate avoiding those pitfalls. Unfortunatley most will tell you how good they are doing despite the reality of how difficult it is to make money. That being said, my greatest resource was a friend who gave me access to load boards and allowed me to research real numbers. I even called about loads so I could get the going "rates" and see if there was some wiggle room. Since I dont have a truck yet I didnt push too far so as to not actually commit to a load I couldnt haul..lol ...but I pushed enough so I could jot down a real number to use in my calculations for projected revenue.

I digressed a little there so let me get to where I am at currently.... Once the decision was made to move forward I decided to form an LLC. I know it is not always the best idea to incorporate until needed and I could have gone into this as a sole proprietor but after reading Redformans thread and some of the troubles he had with changing over while operating I just decided to do it now and start off that way so I dont have to change all my information later. Apparently the federal govt tends to leave out periods or hyphens when they redo paperwork and it leads to headaches for the O/O so maybe I can at least avoid a headache down the road. Anyway I did it all through Legal Zoom and it was relatively painless. If you use them be aware that as you go through the process they keep trying to sell you additional services. Most of which you can do yourself for free. The cost was $169 but when I completed the form they charged me fees for processing the paperwork so it totaled about $320. Much more then I expected but still cheaper then a lawyer so I sucked it up and paid it. If you decide to let them provide all the services they offer throughout the process that fee gets up well over $600 really fast, you are better off doing all that stuff yourself just be committed to staying well organized.

After I heard from the state that my business name was approved I opened business accounts at the bank and obtained an EIN # from the IRS. Companies will tell you they can file this for you for a fee but I went to the IRS website and did it online for free and takes about 10 mins. Also once the business name was approved I started getting mail from compliance companies. The mail has a nice official looking seal and the letter tells you you MUST file and pay by a certain time to stay compliant. READ THE FINE PRINT....These are companies trying to get you to pay for their service to file routine paperwork that you usually can do for free with minimal effort. Dont send money to anyone until you call and make sure they are an official state agency.

Now for the good news bad news.. I heard from my bank today. I was approved for my line of credit so I was excited because that puts me on the fast track to a truck and trailer. The bad news was the amount of the loan was about 50% of what I was asking for so Im not sure what the issue was with that part. The call I got was from the business equipment center and they dont deal with the approval process so I have to call my banker and see if there was an issue with the underwriters. Once I know some more details I can, first, hopefully fix the problem and get the full amount and second let you know here how it turns out. My first roadblock so far in the process but there are other options should this fall through. When I was at the bank they told me they could get me the loan but they would like for me to have my business account with them so I agreed. If they dont come through on the loan Ill at least get the satisfaction of closing my business account and going elsewhere, a deal is a deal so Ill hold up my end if they hold up theirs.

 

No apology necessary Red.

I learned a lot from your posts and just wanted to let others know that the information is valuable but comes free so my way of paying up was to commit to putting something up on the forum that provides either more information on how to go about this process or how not to go about it because I did it all wrong...LOL.

Ok so this financing is a loan not a line of credit.... The reason I said it works like a line of credit is because once approved I have no payment until I actually spend the money and payments are based on how much I spend. And you are correct I cannot get a business line of credit because Im a new business and I dont have any numbers to prove how well or bad I might be doing.

Your post here is exactly why I used you as an example in my orginal post, again loaded with great information. And I will not be buying anything new. Ive heard all the debates and to be honest Im hoping to find something pre- 2003 but I cant go too far back or I wont be able to finance something too old either. New trucks are expensive to buy and expensive to fix (anything post 2003 is expensive and difficult to fix or even diagnose at times) Of course an older truck requires greater scrutiny as well. Im actually most nervous about buying the truck. Ive done so much research on all the numbers but the truck is sort of the biggest gamble. Its one of those things that everything looks great and fits the profile then 3 weeks later the engine just quits.... No matter how much I look into trucks I always feel like its a 50/50 shot at getting a good one. Like you said even brand new might end up in the shop 3 weeks into the show.

Insurance!!!! LOL..Yes I looked into this first...Thats right not in the middle or near the end...BUT First ...lol. The quotes were insane and all over the map...No two quotes were within a few dollars of each other. If you speak to 5 agents you can get a $7000/ yr range on quotes... Kinda hard to get fixed costs together when you just dont really know what that number will be because no matter what....Its a big number.... So the final tally on insurance will come when I have a truck so they can quote me on the value but I found a local guy who got me in the ballpark of where I need to be on cargo and liability...By the way...Its still a pretty big ball park...LOL

 

I have been looking at Freightliners and you are correct, they seem to be in the best price range. Im looking for the best truck for my operation. Fuel miliage will be an important factor so Im steering towards a mid roof or flat top cab since Ill be pulling a flat deck trailer, aerodynamic design for the body style. I know the classics and the big Petes look cool but they burn a lot of fuel and that is money out of my pocket. I also would like to find a 13 speed but I know very little about gear ratios..But Ill be running in the south east and mostly Florida so the terrain is flat and winters are not so dramatic weather wise.

RedForeman mentioned having to fix a bunch of things so Im sure Ill be doing some work on anything used I buy and Im hoping I can get through 2-3 months, at least on the tires I get on the truck. This way I can build a maintenance account to fund repairs and future replacement (which will be .09% of gross rev on all settlements). Id like to use those first few months to get a handle on actual fuel miliage so I can track my improvements and make sure they are paying for themselves over time. So when I purchase new tires (low rolling resistance possibly wide singles) Id like to be paid back on that investment in about 1 yr through fuel savings.. Basically improvements should result in an increase in fuel miliage which should result in an increase in gross revs and hopefully trickle down to increase in net profit.... See Red it is easy!.....LOL