Double Yellow's Company Driver to Independent Thread

krazman,,
I'll save ya 54 years worth of your hard earned savings.
The main requirement of ANY O/O... is having "good business sense". That's undeniably #1.
Don't buy a truck, seriously.

 

DY, if you had had the money to pay outright and knowing what you know now from having to find and dealing with a used truck, would you had bought new? The reason I ask is because with your figures that you posted, minus 20K in interest and the fact that you have pulled 7.5 MPG from a old truck, Dont you think you could be pulling 9+ from a new one? would that not be your other 20K difference?

 

My former father-in-law operated a very successful commercial plumbing distributorship in Denver. Years ago, he outgrew his original building complex, so he built a new one from the ground up. The first thing he did, even before it was completed and he moved in, was sell the buildings to an investor group - for a profit - and leased it back. He freed up operating capital which allowed him to expand his territory, hire more sales reps, and put my brother-in-law to work!

Outright ownership of something new is not necessarily the best goal; it all depends on the business plan.

 

Just a few remarks on this new vs used vs glider discussion. Long winded so be patient LOL.

With any used truck purchase, you absolutely will spend at least $5,000 - $10,000 finding and reconditioning all the stuff the previous owner avoided or didn't know about. Usually within the first 6 months.

Probably even more important is having the ability to know when to recognize you've gone beyond "reconditioning" and are headed into "money pit" status. Being able to recognize a lemon, and take your financial licks and trade out of it before getting too deep into it. That threshold is different for everyone. Everyone talks about it in a lot of the "can I be an o/o" threads. Discussion and actually having to deal with that are two entirely different things. It's like a gambler knowing when to fold and step away from the table. You know you already have X amount of dollars sunk, maybe this time will be it maybe not. When do you stop the bleeding? You have to be able to spot that moment and act. I've had to do it twice. Once on a truck I'd only owned a year, more recently with the first truck I bought 4 yrs ago. Both reached my threshold for pain. The second time was much easier than the first, having been through it once before. Sometimes you need to shoot that old horse in the head and get another horse. I was fortunate, in that my decision involved a couple old trucks worth less than $20k. I really don't want to imagine doing this with a new or nearly new truck I'm on the hook for $100+k for such a decision. The total value can really ramp up risk, along with the stress.

New and gliders are, well, new or mostly new. So not a lot of worn out stuff to begin with. And a stack of warranty contracts you could wear like a suit of armor. Only one catch. Warranty work usually has to be performed at an authorize dealer. Those are usually huge, corporate monstrosities where you will get in line behind the mega and lease fleets to get your pride and joy all fixed up. Warranty parts on back order? Driver, get a room and we'll call you.

A used truck owner has the option to have work done anywhere they want, or even do it themselves. I am loyal to a small local shop. Makes me a slightly bigger fish in a much smaller pond. I can get minor stuff done while I wait. Most anything else short of an overhaul can be complete in a day or three. I usually take advantage of times I'm tired of trucking and just park at the shop, leave them a punch list for truck and trailer, then go home and forget about it a while. If I had to deal with the Freightliner or KW dealers (I have one of each), repair times would be like playing the lottery. Been there, done that, ain't going back.

Won't beat the downtime horse, but yeah. Either pass on whatever revenue/profit you would have done during your shop visit. Or, if you're even able to, rent a truck for around $1,000 - $1,500 a week and keep on truckin. Just for that much less profit, before your repair bill comes in of course. And in a crappy fleet spec rental unit with more problems than your own broken truck, that you will hate driving every moment you are in it.

Then there's that whole scope of warranty issue. What's covered. Perfect example, although on my used truck, was one that happened on day 59 of a 60 basic warranty. ACERT C-15 and an exhaust rocker arm broke. The warranty would only cover the damaged articles. So: one exhaust rocker, the adjacent intake rocker, an intake sensor that was damaged when things got loose inside, and the overhead that was required to complete the assembly. Around $800 worth. CAT noted all original parts and recommended all new exhaust rockers (4 revisions old) and new IVA studs (5 revisions old). An extra $1,600 on top of the warranty work.

Side note that is worthy, was the additional stress and hassle of getting any warranty coverage at all. The breakdown happened on a Saturday. Even had the tow bill (yeah that's not covered either) to prove when it happened. Since my claim wasn't until day 62, they denied it. A little more effort on my part, and the general manager of the branch I purchased this truck from stepped up and covered it (the $800 part) with his store repair fund. Kudos to that, and I rewarded his action with loyalty by purchasing my last trailer there a few months later.

Last but not least, consider the driver. If that happens to be you, the business owner, you are probably more careful with the equipment. You don't do drag race starts. You don't try to be the first one up the hill. You don't use high range gears driving through dirt lots and across railroad grades. You take care of little things before they become big things. Generally avoiding stuff that will break a truck sooner. If you're not like that, sell it now and go to work for someone else. If you employ a driver, just forget that "taking care of the truck" thing. Even the best one will not be as careful as you. The part of the fleet you aren't driving yourself will be in the shop more.

At the end of the day, you have a much greater opportunity to reduce shop down time with a used truck. You have complete control of every aspect of repair/maintenance and zero obligation to fulfill warranty terms and conditions. The thing is, those are "soft" numbers that really don't fit the dollar by dollar charts DY favors. I say "soft" because it's not a number you'll see on a price tag or repair invoice. It's value that comes out of your profits as a result of a "hard" dollar event. It's a number you really only learn through experience. Unfortunately, everyone starts without it, so somewhat at a disadvantage there. At least by being aware of it you can keep it in mind while you're also getting schooled at the service department cashier LOL.

 

I have owned 2 new Petes. Never had a problem getting warranty work done.Usually in and out same day. I would call ahead if I could.

First truck. Major transmission failure at 293 000 miles I was asked for proof that I had changed the fluid at 250k. I had proof. I paid nothing for the repair. I did wait 2 weeks for parts. Repair done at a ford dealer.

Second truck: blown head gasket / cracked head at 447 000. I paid $800 for an extended engine warranty to 500k.
Truck went in Thursday morning and was done Friday at 5 pm. They also replaced 2 pistons/liners.
The bill: $8500. I paid $500 for fluids, filters and new rod bearing that they said I should replace.
Repair done at Cat shop in Lincoln, NE.

My truck has 1.1 million miles. I think I will eventually get a new glider before I start spending big money on this one.

I paid cash for the first two and will do the same again. And probably drive it over a million miles and then I'll be done.

 

Just do not know anything about it . figure it would be better to hire someone that deals in the long list of paperwork needed to get going . By the time I got all the buying needs done it would take too long . Once the pre OO stuff was taken care of I think I could manage the rest as I know there is help for that . Accountants and such . I would figure it out .

 

Of course you can do what you want, but there are smarter ways of learning to run a business than while running a trucking business. It's complex and highly regulated. And quite capable of eating your shorts very quickly, to say nothing of your credit rating and assets, including your house.

Stay company for a year or two. That way, you'll see what happens to your income during slow freight periods and bad weather. And how long you're down when something on your truck breaks, as it will.

 

No. It's much better to start off with at least some knowledge. Google "free online business courses" for a start. Download business topic audio books, podcasts, and so on. Start spending a few of your hours behind the wheel learning something. If you truly want to learn, you'll find these are like eating potato chips. The one you're listening to will bring up topics in summary that you want to find out more about. Refine your search and drill down on those topics.