Question about investors in the trucking business

These two quotes tell me that you are clueless to what it takes to get a good driver in the seat. You won't just put out an ad and then they flock to you. When I hire, I may go through 100 applications for just ONE driver. I have wasted more time in interviews, than I want to remember. Then there is the road test, OMG how many drivers with 'years' of confirmed experience not being able to do a pre-trip or hook a trailer, let alone be able to get it out of the "dock" area we have setup.

You also have to have a reason for them to work. You can't just say "I'll give you 40¢ a mile" and then not deliver. You have to have that money in the bank to pay them no matter what. you get a reputation of micromanaging - which happens a lot - you will not attract the right drivers but rather the crappiest ones.

In the past 10 or so years, the quality drivers are either in positions that they dictate to the carrier or retired. The quality of drivers overall have declined to the point that the best is what some of the worst was 20 years ago.

So good luck with drivers, they are the hardest of the things to deal with and the hardest to find.

 

Get verification from a fleet owner like @Ridgeline. One bonehead in your truck can sink your company and bankrupt a team of investors. Want to learn the business quickly? Work at a mega, surrounded by garbage. You will instantly be able to spot an A Game driver from the thousands of braindeads.


Good drivers make money. Money doesn’t make good drivers.

 

People make investments generally to make a profit unless they do so to use the losses as a tax write off on their total income. A potential investor needs to weight up what kind of returns they expect, for example if I leave my money in term deposit I get (X) amount of interest per annum, if I invest in shares I get (X) amount in profits/ losses, if I invest in a transport company I get (X) amount in profits/ losses. If your good friends now will that remain so if you encounter any financial issues? Will your friend allow you to run the business, can you work with them telling you what to do? Lots of due diligence involved here with no easy solution, as these are all personal choices. All the best mate whatever choice you make in the future.

 

Years ago, we were moving super loads from Corpus Christi to Limon CO. Loads were $4mil each. We got loaded, but shipper was slow with the BOLs. We finally got the BOLs at 3pm. I told everyone what time to be ready to roll out. A couple of female pilot cars looked pissed. They talked to their driver, a rookie, and tried to convince him to leave. He came up to me expressing disappointment.

“Why aren’t we leaving?”
Where do you want to go?
“Somewhere!”
Be specific. Where exactly do you want to go?
“We could make Junction Texas!”
You didn’t do your homework. It’s 3pm. By the time we get to San Antonio, we will hit the metro curfew. Curfew ends at 7pm, we have 56 miles of the 1604 Loop to i10and then 110 miles to Junction. What time would we be getting there?

“Ummmm….?”

10pm. With a super load. Where would we park?

“I didnt get that far into things. Sorry.”
See you in the morning.

Next day, this driver was in a hurry, blindly followed his idiot pilot cars up US84, ran into a construction zone and couldn’t get through. Those fines are HUGE for oversized and hazmat.

 

If you think good workers are a dime a dozen then you best take those rose-coloured glasses off.

 

Something like this would sink a small fleet. CSA points, loss of contracts, sky high insurance premiums and fines.

 

If it hasn't already been said would tread very gently doing business with a long time friend.

 

Finally.

Why me? I have no idea what a truck is (yes I'm being a smart ******).

Bad approach.

First let's tackle the partnership, 50/50 isn't going to work, one of you needs to be a domiment partner. One of you needs to be the decision maker, without the second guessing or emotional involvment. This seems to be a passive investor which also means that he needs to let you make the decisions.

I touch on the capital later.

Why?

YOU seem to not get one of the biggest thing, what makes you think you or your wife can actually drive a truck?

Serously many think they can but they can't, they are dangerous on the road.

Then we have insurance, which is not going to be cheap, if you can get it.

Why?

50% isn't right, you are doing all the work, back office and so on, and you get 50%. 60/40 is a good start.

Spot market?

Really?

Yeah you keep saying this but why then get someone to "invest" in it?

You going to use it as a lost producer to offset your other business ventures?

Again why?

I mean most of the freight you get will be getting work that one driver will get and you still don't get how the system even works, so putting a team into a truck with no idea how to find the work for teams is ... well ... dumb.

But then it goes back to are you going to use it as a lost producer to offset your other business ventures?

OK here is my opinion, rethink all of it. You need to learn how this industry works, many of us make it look easy and those who are making money are not going to stop and tell you how to make money - it is a competition thing.

The capital isn't enough, you should start with a partnership at least 100k each.

Why?

Because even if you finance the truck, your insurance will need to be paid, you will need at least 60 days to 90 days of operating capital. When (not if but when) you have a break down, you will need money to get it fixed.

The 50/50 partnership is a no go, seen a lot of them melt down because of what I mentioned, you can not have 50/50 work, someone has to be the decision making party.

That said, there is the problem of the form of entity and the liablity involved with this industry, all trucks are targets for litigation, no matter what. If you are a driver and a manager, you make decisions and hold that liability if something happens. The owner(s) are often named in lawsuits which many have lost, doesn't matter if you have an "LLC" or not, nothing protects your assets, I know a few who lost their house and other businesses from the court attaching all of it to the case. C corp is what I use, S corp may be just as good but I also have taken steps to lessen my personal risk.

To many holes so far.