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Leasing on to a carrier? How does that work?

Discussion in 'Ask An Owner Operator' started by cbradiohead, Oct 27, 2014.

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  1. Oct 27, 2014 #1
    cbradiohead

    cbradiohead Bobtail Member

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    Hi guys, sorry if I put this in the wrong category. I'm from the east coast and have seen some different type of leasing going on in this dog gone industry. Don't get me wrong, I love it for a few reasons but to cut to the chase, how does leasing on to a carrier work? I have $50k to buy a truck, have a couple years experience and thought about doing this.

    What does the contract usually look like?
    Is there like a one year minimum?
    Do they deduct payments right off my pay or do I pay them for each thing separately?
    Do they take care of all major permit and tax costs?
    Are there fuel discounts?

    And Im confused, would I be an employee or a contractor to them? I would be using my equipment but would I have freedom to drive wherever? I mean, what are you really doing here, just using their authority to operate as if you had your own? Thanks fellas.
     
    cbradiohead, Oct 27, 2014
    cbradiohead, Oct 27, 2014
    #1
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  3. Oct 27, 2014 #2
    ew2108

    ew2108 Road Train Member

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    All of this depends on the carrier you lease on with. If you want to get your own authority or lease on to someones authority i can put you in touch with a guy. I'm actually leased on with schneider Im not sure what you mean about the contract but mine is pages of documents. I think you can negotiate your contract and length with whoever you lease on with. Its your truck you can likely walk when you want. I have a 3 year contract with my carrier.

    Deduct payments for what?
    If you have your own authority you handle permits and all if you use their authority they handle most of it. Taxes are always your responsibility.

    Yes you'll likely get fuel discounts from a carrier. You will be independent if your not there is any issue. If you use a companies authority you run exclusively within their network unless you negotiate otherwise. Did I answer everything? Can I answer anything else for you?
     
    ew2108, Oct 27, 2014
    ew2108, Oct 27, 2014
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    cbradiohead Thanks this.
  4. Oct 27, 2014 #3
    Ridgeline

    Ridgeline Road Train Member

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    Did you learn anything about how to run the business side of things in those couple years?

    I would save your $50k right now, and start learning about the business side of things. Then look around for a truck, $50k is a lot of money for a used truck so plan on something a bit cheaper so you can have money to operate.



    Depends on the company what it looks like. Most of the contracts are written to protect the company, not the lease operator.

    No not normally, if there is, it may be a stupid thing to do because it steps over the line of employee/contractor.

    Yes they do, or most do but you may have the chance to pay things off like permits and plates - again this is why you don't spend $50k on the truck.

    Permits yes, taxes no.


    Normally yes but I've got one company who keeps calling me to put my idle truck to work and the person said no discounts - can you figure out why my truck remains idle?


    You would be a contractor, technically a lease operator.

    Yes to a point. See you may have some independence but you are there to do a job and that is to haul their freight.

    The closest thing to being on your own is to be a lease operator - or to me it is - but ... there is something to be said to allow them to handle all the BS paper work and to do things like get permits, pay the road taxes and so on.
     
    Ridgeline, Oct 27, 2014
    Ridgeline, Oct 27, 2014
    #3
    cbradiohead and ew2108 Thank this.
  5. Oct 27, 2014 #4
    cbradiohead

    cbradiohead Bobtail Member

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    I did learn the business side to the point of what I was exposed to, mostly administrative, broker and dispatch stuff. I'm doing online research to figure out the rest. I'm even considering hiring a mentor and sure thing an accountant.


    Thanks for the information. My big concern is getting a good idea of how this works so I can start running some numbers with an accountant before I plunk down those 50 big ones. 35 can go for the truck and the rest for emergency repairs and other costs.

    What permits or road taxes would they cover specifically? Ad valorem stuff, 2290? I thought all I needed was just my own things like CDL and equipment and of course pay for my own truck registration, my own income taxes, IFTA etc. Thanks again
     
    cbradiohead, Oct 27, 2014
    cbradiohead, Oct 27, 2014
    #4
  7. Oct 27, 2014 #5
    ew2108

    ew2108 Road Train Member

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    pretty much every state has permits that you need
     
    ew2108, Oct 27, 2014
    ew2108, Oct 27, 2014
    #5
  8. Oct 27, 2014 #6
    cbradiohead

    cbradiohead Bobtail Member

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    Quick reply, right before I edited my post.
     
    cbradiohead, Oct 27, 2014
    cbradiohead, Oct 27, 2014
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    ew2108 Thanks this.
  9. Oct 27, 2014 #7
    cbradiohead

    cbradiohead Bobtail Member

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    Thanks for the help. I'm trying to get an idea of what they do specifically and what they pay so I can run some numbers. What permits or road taxes would they cover specifically? Ad valorem stuff, 2290? I know truck registration, IFTA insurance, diesel, income taxes, repairs and maintenance would be covered by myself.

    Oh, of course, what kind of % or fee do they charge overall for their service or the agreement? Wow I'm forgetting one of the most important questions!
     
    cbradiohead, Oct 27, 2014
    cbradiohead, Oct 27, 2014
    #7
  10. Oct 27, 2014 #8
    Starboyjim

    Starboyjim Road Train Member

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    They're all different. They all get loads for comparative rates, so they gloss some stuff, lowball others. Be careful, shop around, read the missing information as much as you listen to what they tell you. One company only pays $1.35/mile. Low, right? They don't charge for the trailer,they pay all miles, deadhead and loaded, they pick up all license and IFTA fees, and all trailer maintenance. Company 2 pays 80% of linehaul and FSC. High pay, right? They don't pay deadhead miles, don't pay license or IFTA, charge for the trailer rent about as much as a purchase payment, and it's all live on/off. You just have to look real hard and real close to all company's contracts.
     
    Starboyjim, Oct 27, 2014
    Starboyjim, Oct 27, 2014
    #8
  11. Oct 27, 2014 #9
    ew2108

    ew2108 Road Train Member

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    With schneider they get all the permits and just charge a fee once a year. It 65% of the revenue from a load. I would just assume its gonna cost you a dollar a mile to run your truck atleast. With us mostly everything is paid through them so its discounted so i cant give your numbers to help you guesstimate
     
    ew2108, Oct 27, 2014
    ew2108, Oct 27, 2014
    #9
  12. Oct 27, 2014 #10
    cbradiohead

    cbradiohead Bobtail Member

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    The clouds are parting now. What I thought is that all carriers had roughly the same agreement and I could expect to be responsible for fairly the same things across different carriers. I didn't know it was that much of a change from one to the other. Do they have the freedom legally to do all this variety? I'd think that someone would be regulating it no? I'm not saying "Hey lets set some strict standards here you crazy folks" but there should be some common ground somewhere.
     
    cbradiohead, Oct 27, 2014
    cbradiohead, Oct 27, 2014
    #10
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