am i doomed ? getting own authority

Unfortunately, the strategy you describe is like getting a little bit pregnant. There isn't a short cut around the "no experience in business" barrier. You just have to have a plan and run it. Or don't.

Getting your authority and holding it till April also means being insured the whole time for nothing. And you've still got nothing in April because you haven't done any business. Make it inactive and the time doesn't count. In fact, it might even make the first few brokers suspicious of criminal activity.

My experience getting loads when just started was a lot of hustle. You'll find a few that will have minimum time with authority barriers, and nothing fixes that but more time. The rest may very well load you based on how you sound over the phone. If you sound like you know what you're doing and maybe give a background story, it then comes down to how bad that broker wants to move the load versus how risky you seem. After you hustle the first three loads, assuming no claims or issues, you now have a reference sheet to provide the next ones. Then you build it from there. You may need to "buy" your first loads by negotiating down a little to offset the risk of hiring the new, unproven guy. Make those short hauls to minimize potential losses and keep your eye on the ball with making those into references. After you have three in the bag, negotiate like a rock star. At that point the only negative thing to overcome is the recent date on your authority letter.

The first milestone is one month. A few of the larger brokers will load you at that point, and you should have a decently developed reference sheet and positive reputation on the load boards you subscribe to. You'll also get your breath knocked out with that first insurance payment and the first few tanks of fuel. Assuming you're hustling, you'll see that you were able to make those despite all the start-up drama. It gets easier.

Six months is the next milestone. At that point just about anyone will load you. You've been around long enough to have a meaningful safety score, and should have already started forging some good business relationships with a few brokers. You also have a better handle on where the markets are and how you can work them to run your plan better. It's not as simple as you think - you don't know what you don't know. The only way to get it is to live it and learn it.

After a year your insurance will come down some since you have business history now, and recent commercial driving if you didn't have that to start. Timeframes will vary depending on the insurance company.

 

$11k/year for insurance? Really? - Why is that so high?
Even when I got my own MC back in 2009 it was under $8k/yr and that
was with Progressive.. Comp/Coll/Liab/GLiab/Um/Uim.

Now of course, with time in for good behavior - I pay around 1/2 of that or so
and no longer with Progressive. Progressive DOES offer an unlimited radius in some states now and the list increases all the time.

You need to get that $1.70 CPM down closer to $1-$1.10/mile.

JBHunt calls me all the time for their 'power only' program but the best I have ever seen out of them was UP to $1.68 (based on FSC) but that fell now too.

By the way, make sure you fully understand all of the compliance issues/forms/permits and what not you need for your own authority. Most important is enrolling in random drug testing. This must be done within 21 days of filing for your MC (IIRC). Join OOIDA and then you can sign up with them under their program. It's about $100/yr and don't forget UCR and 2290 payments...Well 2290 is still in a weird state of status I think.....

Aug 2011 I passed my new entrant audit. There isnt a single thing they overlooked. I was totally scrutinzed from head to toe - but passed it cause I was prepared...



Best of luck to you. Always ask questions - even if they seem dumb..

 

You don't have to go too low on the first ones. As you know, if you don't ask you won't get. On the other hand you don't want to knock their head off with an unreasonably high offer. Often best to start by asking what they're looking to cover the load at. Then you can decide if its close enough to work on, or cut them loose and find another one. Once you get a feel for the market your in, you'll be able to make better offers to start where you want to be. It will take a couple of calls to get a feel for the dance.

You didn't say what your were hauling, but here's what I did with a reefer. First load was actually a dry van load and I got it for $1.60/mi. The broker figured out she was my first customer and almost passed. I figured out she was up against penalties or losing the load and chatted her up about my equipment (recent service) and driver (son with 3 years of OTR experience with other companies). The rate was a few pennies below the minimum target in my pricing model, but still a few cents above cost.

The second one was a reefer load, similar circumstances with the late fees looming. I talked my way into it and got it for $1.86. After those two, every load for the next month (late March/April this year was strong for avail freight) was $2+ except for one I took for $1.94, and that one was a "keep from freezing" dry load that hardly ran the reefer, out of a crummy market.

Right now the rates have sagged a bit, but are coming up week by week with holiday related shipping. I don't see where you will have to do much worse than I did when you get started. As soon as your authority goes active you can sign up with the load boards you like. There's plenty of threads on those so I won't go into choices. Your numerically high MC number will automatically tell brokers you're brand new, which they will verify and lookup safety score before you can say "hi, my name is ____" so be prepared for a few "no thanks" when you start calling, and have your story prepared before you dial.

 

I don't know about the OP, but in our case there were a couple of plusses and minuses.

Good:
- credit score
- clean MVR (me)
- completed CDL refresher course (me)

Bad:
- In business less than one year
- driver with a violation in three years (son, will come off this coming May)
- driver with less than two years recent CDL experience (me)

If the OP has good credit and clean MVR, then my bet is on new business and recent CDL experience driving the rate.

 

Since your investing all this money why not take the time and moneyand do a refresher course even if you have to travel to a refresher course. I think that would be a very wise investment. And maybe hire a driver who has experience to start.

 

There isn't a truck on the road that will make it at 1.10 a mile. What you are telling him is that he needs too fit his BPE into a cheaper rate. Instead of hauling freight that is going to pay him better so that he can make a decen't living and be able to maintain his equipment.

 

You mean 2010, right?

I think he's including driver's wages in that $1.70, which he should, you gotta pay yourself.

 

Yea, but I look at the cost per mile that my truck costs. My wage can fluctuate but the trucks' fixed costs can't.
No matter what, that truck will always cost me something fixed each year....
That was my point in saying that I felt $1.70/mil was too high of a base cost.

PS. I got my USDOT in April 2010. My MC in Nov 2010.....So yea, I guess I was off a year.
I thought I got my CDL in 89 but GWCC claims it was 90. So what do I know?