Business sense or Trucking sense

Discussion in 'Ask An Owner Operator' started by Boxxer, Nov 24, 2014.

  1. Boxxer

    Boxxer Bobtail Member

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    Which is better to have being a o/o a good business background or a good truck driving background??
     
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  3. blairandgretchen

    blairandgretchen Road Train Member

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    To be successful?

    A good knowledge of the industry, a good safety record, and just enough business sense to be dangerous . . .

    A Harvard grad with zero driving experience would fail.
    A ten year veteran with bad money management will fail also.
     
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  4. Boxxer

    Boxxer Bobtail Member

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    Yes to be successful..
    I've ran and owned small businesses, I know about the business side, overhead, expenses, taxes, inspections, equipment expenses, budgeting, marketing, insurances.. I also have experience as a mechanic and paint/body man.. I feel like I have a good base on that side of this industry.. I have very limited to none driving.. I understand you need everything but some people can never understand or are too lazy to learn the buisness side... I was thinking it needs to be,, buisness 60/40 driving experience... Or am I wrong??
     
  5. Blu_Ogre

    Blu_Ogre Road Train Member

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    I would say you are close. I would add in some motivation/persistence/fortitude/common sense into that split.

    To a certain extent that is covered by running a SMALL business.

    Characteristics lacking in most corporate/MBA types I have met.
     
  6. gokiddogo

    gokiddogo Road Train Member

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    The businesses you owned, were they more towards retail and price based, or are we talking about some type of service business? Service is how you will make money in trucking. You will not win if you try to do it for the lowest price. You can market all you want how good your company is, but in trucking your customers are measuring your service by how often your trucks are on time for appointments, and when they are late, how was the communication, and how was the situation dealt with? You have to build that reputation. It doesn't matter how many letters you have after your name if you can't get it there when you promised you would.

    That being said, there is a mountain of regulation you need to comply with in order to keep the DOT happy. If you are audited and they find the regulations aren't being followed, the fines are so steep they are likely to put you right out of business.

    Without being a driver, at least for a while, it is difficult for someone to understand how trucking really works. The stories which you will likely think are complete BS but from someone who has never done it they can't tell the difference. Driver calls you says the receiver won't unload the product because of whatever reason (1 minute late at walmart because the security guard took 15 min per truck in front of him?). Or he needs a t chek for $275 to pay the receiver to unload the truck. Someone rips a hood off in a parking lot. The road is icy as hell and the delivery is going to be late (so is everyone else) and it is some freak storm, while the dispatcher (you) is looking at the radar and thinks "what is this crap, there is no storm there" ... would you rather he calls you from upside down in the median? Crap like that. You can only learn from being a driver.
     
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  7. Boxxer

    Boxxer Bobtail Member

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    I owned a body/ fab shop.. Customer service driven.. I understand the reputation side of doing what you promise n giving the customer their money worth.. I also understand negotiations with customers and respecting customers.. It has to be a win/win for everyone.. I've belt with inspections with the EPA (I think their worse then dot) I had to deal with toxic waste n it's disposal.. We had air, soil test ran all the time from EPA.. They don't fine you they close your doors if you mess up.. I know it's not the same but I see some similar items..
    I understand you can't run a buisness n break even, you need to replace or upgrade equipment, pay yourself, retirement, etc.. I understand overhead, payables/receivables.. This is what keeps any buisness alive..
     
  8. gokiddogo

    gokiddogo Road Train Member

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    What is your goal? Own your own company, own authority, and run maybe a few trucks? 10 trucks? 50? Or ... ?
     
  9. Boxxer

    Boxxer Bobtail Member

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    My goal is to start small, own 1 used truck n trailer, start off as a leased owner until get insurance cheaper and learn the trucking/lane ropes.. In 1-2 years get authority. Run that 1-2 years work up to 2-3 trucks max.. Honestly I think getting good workers is the hardest part where I'm located..
    Thanks for any and all info gokiddogo
     
  10. rollin coal

    rollin coal Road Train Member

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    You need both. There are truckers with 20-30 years of experience driving that never soaked up anything worthwhile about the freight business just as there are businessmen who've never driven a truck that know nothing about it. You can learn the nuts and bolts basics of business from a book but trucking sense comes from experience. Pay attention.
     
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  11. RedForeman

    RedForeman Momentum Conservationist

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    With 20/20 hindsight, I'd say the business background is way more valuable than driving experience. However, with one great big catch. New operators entering the business will be clueless on forecasting costs, unless they happened to be leased to a small carrier for some time who offered two things:

    1. Extended access to established service provider relationships and other programs to minimize operation cost.
    2. Open books.

    In other words, full visibility and benefit of experience, with only the risk of owning your own equipment. Without that, you won't know how much you don't know until you're spending your own money doing it. The cost to operate a class 8 truck can be breathtaking at times, and two guys running the same equipment hauling the same thing can have dramatically different cost basis and business models.

    I've posted this here and there: I estimate the cost of my own lack of experience at around $50,000. That is, had I started with a better visibility of what I was getting into, along with greater industry knowledge, I would have spent that much less running my business in the first two years. For a lot of guys entering the business on a shoestring, you can see how that might stress the financials a bit.
     
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