I'm REALLY Confused About Something

dvjordan · Jan 8, 2013

TX skateboard said: ↑

Tjats really important to keep in mind. cause honestly that is the worst part for me about o/o , having to deal with repairs. i bought my truck back in may. I really havent had any problems with it(btw, trailer is also mine as well) just basic stuff like air leaks tire or two, just nothing major at all. I hear alot people always loose everything cause they never save a good enough money for any MAJOR repairs that might need to be done. so the week before christmas eve everything starts going wrong. That thursday night, my alternator went out while i was in lyberty,tx (45 miles east of houston) so "L U C K I L Y" (i cant stress that word enough) i actually made it to houston where i park my truck. and here i am running to freightliner @ 11:30pm and loaded btw. so i get it fixed and spent around 3-4 hundred cause i needed a new battery as well. so off i go to odessa, TX and next day get a blowout!!! get that fixed, and while my tires getting fixed i notice weird noise coming from motor. so there a mechanic shop near by that diagnosed the noise as being the big bull gear for crankshaft i belive. so asked the guy if i left it there how long would it be till i saw my truck again. he honstly told me with the holidays around the corner and the way they where booked, it would be about a little over amonth.. so i tell him.im going to houston and he says their a 50% chance i can make it. so i took my chances( complete idiot i know). long story short i broke down about 5 hours left to houston. got towed to houston with the help of a friend. only.paid for his deisel. tow wanted to charge me an estimated 2800 to 3000 big ones just to tow it to houston. so now its here in houston still getting worked on due to the holidays got in the way and plus this guy had a lot of trucks he need to work on too. just in this major repair i will be paying around 3,000 PLUS the three weeks of work im loosing. my truck payment is due the 15th thats gonna be fun. and bills just dont stop cause something BAD happened to me. anyway this is a HUGE set back for me compared to how good i was doing. BUT!!!!!! LUCKILY, i saved enough money to help me through this. SO i get to be lazy and worry free till my truck comes out of the shop which will be in a day or two , hopefully.
So thats a good thing to keep in mind, get a good truck but always make sure you have enough money for major breakdowns. Cause ANY truck is capable of breaking down. especially in your situation cause you dont know how your drivers will treat your truck.
but like i said thats something to keep close in mind. good luck man you can do this!!!
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Thanks for the feedback. Keep it up and I hope you make out all right. That's pretty much exactly what I really, really wouldn't want to happen in the first couple of months.

dvjordan · Jan 8, 2013

dannythetrucker said: ↑

Everyone seems obsessed with the 15%, but I say who cares ? I'd pay someone 20% to run my truck on $2.75/mile freight over paying someone 10% to run my truck on $2.00/mile freight.

You need to get some more numbers, when he says he grossed $900,000. Does that mean $900,000 gross / five trucks ? Or does that mean each truck grossed $350,000 so he grossed $350,000 x 2 = $700,000 + 15% of the other three = $900,000 ? Because if he's grossing $350,000 per truck that is going to be good no matter how you do the math. If he's saying the 5 trucks made $900,000 that really doesn't make sense since 3 of them aren't his, but whatever, that would be $180,000/truck and if he's running them all over the country that's really not all that impressive and probably not going to make you much money.

The numbers you need is gross/truck and mileage/truck for last year and then you'll have something to figure off of. Lot's of other questions like if a water pump goes out at midnight does the driver call you or your bro-in-law ? Is he going to be doing your billing and compliance, licensing and permits, etc.. for you ? I mean if he's really going to be managing your drivers and trucks as well as dispatching 15% might be pretty fair.
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Well, seems like there's more than one way to skin this cat. I'm not 100% sure how much he's willing to take on just yet. Whatever he does end up doing for me in the beginning, I'll be doing myself sooner or later.

dvjordan · Jan 8, 2013

dannythetrucker said: ↑

Everyone seems obsessed with the 15%, but I say who cares ? I'd pay someone 20% to run my truck on $2.75/mile freight over paying someone 10% to run my truck on $2.00/mile freight.

You need to get some more numbers, when he says he grossed $900,000. Does that mean $900,000 gross / five trucks ? Or does that mean each truck grossed $350,000 so he grossed $350,000 x 2 = $700,000 + 15% of the other three = $900,000 ? Because if he's grossing $350,000 per truck that is going to be good no matter how you do the math. If he's saying the 5 trucks made $900,000 that really doesn't make sense since 3 of them aren't his, but whatever, that would be $180,000/truck and if he's running them all over the country that's really not all that impressive and probably not going to make you much money.

The numbers you need is gross/truck and mileage/truck for last year and then you'll have something to figure off of. Lot's of other questions like if a water pump goes out at midnight does the driver call you or your bro-in-law ? Is he going to be doing your billing and compliance, licensing and permits, etc.. for you ? I mean if he's really going to be managing your drivers and trucks as well as dispatching 15% might be pretty fair.
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Right, and I'll definitely have to ask what the specific numbers are. However, logic dictates that his two trucks are going to have the lions share of the gross, so you're calculations are probably not too far off.

dvjordan · Jan 8, 2013

Old Man said: ↑

The hard part, finding and keeping good drivers, what do you have to offer to keep a driver.
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Well, nothing's set in stone yet, but I thought about starting them at 0.39 with a per diem, with advancement up to 0.60 or so when I have my own authority and am dispatching all my own loads. Not sure about the whole health insurance thing yet, but was thinking about including some form of life insurance/accidental death coverage, etc. Don't know about a retirement savings plan, but it can also be considered. Ideally I'd like to give them a 1099 and supply health insurance. Not really sure that's even possible though. Of course paid vacation aught to be in there as well. All that's up in the air still. However, I know all to well from my own experiences how crappy employers can be.

TX skateboard · Jan 8, 2013

dvjordan said: ↑

Thanks for the feedback. Keep it up and I hope you make out all right. That's pretty much exactly what I really, really wouldn't want to happen in the first couple of months.
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I dont know what your financial state is but if you have a good amount of money saved up ALREADY i believe youll be able to overcome alot of problems (if any) pretty good. problem with alot of guys they get in the business and are living pay check by pay check, so when something major happens they're stuck.

im actually in almost the same situation as you are. im with a husband and wife that have authority insurance and finance company. and they charge 15% of for that also. i like it. i have no complaints really. but i am looking at getting my own authority already. but im taking it easy right now. i plan on being with them hopefully another six months beforr i get my own autho. just scoping the whole operation out i guess. good luck man, im sure you'll be ok.

Pound Puppy · Jan 8, 2013

Have you ever driven truck OTR? That may be a good start too learn the business before getting into a very difficult industry blind. I can give you my numbers aa a leased O/O and theyre good, the catch is my equipment is paid for and I have cash in reserve. I grossed 205,000 and brought home 81,000 after taxes. I got killed on taxes this year. If you wanna do it buy a good truck and drive it yourself a year or two and learn the industry. Get an OOIDA membership and use thier business workshops and pick thier brains. Anyone out here can tell you anything you wanna hear if it means making a buck off of you. Get youre feet wet and get a hands on education before you try this.

dvjordan · Jan 8, 2013

Pound Puppy said: ↑

Have you ever driven truck OTR? That may be a good start too learn the business before getting into a very difficult industry blind. I can give you my numbers aa a leased O/O and theyre good, the catch is my equipment is paid for and I have cash in reserve. I grossed 205,000 and brought home 81,000 after taxes. I got killed on taxes this year. If you wanna do it buy a good truck and drive it yourself a year or two and learn the industry. Get an OOIDA membership and use thier business workshops and pick thier brains. Anyone out here can tell you anything you wanna hear if it means making a buck off of you. Get youre feet wet and get a hands on education before you try this.
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I have not, just some dump trucks and a couple of local trips. About the only familiarity with OTR is from the people I know who do long haul trucking. However, all the guys I know don't mind the money they're making. Guess I haven't run into anyone yet who's not doing at least ok.

dvjordan · Jan 8, 2013

TX skateboard said: ↑

I dont know what your financial state is but if you have a good amount of money saved up ALREADY i believe youll be able to overcome alot of problems (if any) pretty good. problem with alot of guys they get in the business and are living pay check by pay check, so when something major happens they're stuck.

im actually in almost the same situation as you are. im with a husband and wife that have authority insurance and finance company. and they charge 15% of for that also. i like it. i have no complaints really. but i am looking at getting my own authority already. but im taking it easy right now. i plan on being with them hopefully another six months beforr i get my own autho. just scoping the whole operation out i guess. good luck man, im sure you'll be ok.
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Thanks. I was going to try with $25k reserve for two trucks, but judging by everyone's experience it would only cover one.

NavigatorWife · Jan 9, 2013

dvjordan said: ↑

Thanks. I was going to try with $25k reserve for two trucks, but judging by everyone's experience it would only cover one.
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Yes we all would love to see you make it with your sanity and some money in the bank for those rainy days when the hail falls..

tomkatrose · Jan 9, 2013

dvjordan said: ↑

Well, to be honest, the main motivator was the increased income potential and, according to the dispatcher, that I can get enough loads for two rigs. However, when it comes down to brass tacks, there is no reason not to go with one rig in the beginning. It would certainly make things easier in the event of a complete implosion.
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Its funny. I watch American Greed on CNBC and they show stories of people who lost everything because some ponzie scheme promised huge income potential. In hindsight, they always say "if it seems to good to be true... or if it seems like such easy money...". Considering trucking is a very commoditized industry and the margins are very thin in general, does this opportunity seem too good to be true? Think long and hard about it, listening to what everyone is saying and if you want to pay for the education, buy one truck and see how it goes, thereby limiting your exposure. You have everything to lose if you're wrong where as he only loses a truck to dispatch.

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