income

I welcome any and all intelligent debates but please be SPECIFIC and be sure YOU have done your homework and be able to back up what you say with PROOF. Meaning show me where you got your info with the organization or company you gleaned the contradictory information from. If I am wrong then show me. I am man enough to step up and say "I was wrong." Just prove it first.

 

Read Broncriders thread "Here we go, So you want to be an O/O"

Real life numbers.

 

JL sad exactly why he didnt make it .... he was a LEASE OPERATOR .... that is ALOT different than an OWNER / OPERATOR .... as a lease operator you are only a glorified company driver with no interest in the truck .... you are just driving the companies older equipment and making THEIR payments for them

When your lease is done .... you loose the truck .... I know of one that did the LEASE OPERATOR and he went bankrupt .... but he also had no brains for anything .... and how he was even able to kep from being shut down by DOT is beyond me .... I used to have to help him all the time with the logs

If you do lease operator make sure you know what you are getting into .... and yeah read Bronc riders postings he will also answer any questions you happen to have

 

Yes he is exactly right Lease Programs are BAD NEWS! I try and explain as much as I can about the pitfalls of lease purchases to any driver even considering a lease purchase. Arming drivers with as much information about ALL the possible costs associated with the truckload end of a lease purchase is all I was trying to do. Hopefully drivers that read these posts will avoid the mistakes I made.

 

Well.....I lease a truck. I'm not buying it.....I lease it. And I welcome anybody to take a look # my numbers. The thread is "Time for Prime". Nothing to hide.....good and bad. The only bad weeks I've had have been my own fault. Bad decisions will kill you in this business. All I can say about jlkklj777's numbers is that I must be WAY ABOVE AVERAGE. But, when I compare numbers with my buddies here # Prime.....according to jlkklj777's numbers.....we're ALL way above average. Either jlkklj777's numbers don't apply to everyone......Or....Prime really is and industry leader.....hmmmmm. Either way, I don't know what the Average driver makes... I just know this works for me...and 2k+ a week.....AFTER EXPENSES....and paying my co-driver(wife ) right around $750 does not match up with what jlkklj777 is putting out. And I'm not running junk....my truck had 44 miles on it when I picked it out of a list of around 30 other trucks with less than 100 miles on them. One thing I do agree on is never get into a closed end lease......and certainly don't buy a truck you(or someone else) has racked up 600k miles on.....MOST aren't taken good enough care of to last for long. There are exceptions....but you have to really look for them. I'm not going to quote "Averages"....I just know how myself and my friends here are doing.

 

Since apparently the only intelligent person posting on this thread is the one who, by his own admission, tried and failed, I don't know why I'm going to waste my time. But maybe someone will learn something with accurate financial numbers.

1.)At the national average fuel price that you stated($3.35 per gallon), the fuel surcharge would be .36 and not the .25 that you quoted. This is based on the widely accepted and used fuel surcharge table that is used by most carriers. The table is based on a $1.20 per gallon basis price and 6.0 mpg. This inaccuracy alone equated to $13,750 per year using the 120,000 paid miles per year that you used in your example.

2.)Those of us who have been in this game awhile know how to spec a truck when we order them so that we don't get 6.0 mpg. My fleetwide average based upon last quarter's fuel taxes was 7.361 mpg on all miles driven(and no,I don't cheat on my fuel taxes either). This equates to fuel savings of $13,420.17(again based on the mileage and fuel costs in your example).

3.)By implementing the use of Espar diesel fired heating systems and Dometic NiteAir battery operated air conditioners, our idle time is non-existant. That equates to a cost savings of $3668.25 based on your example.(The initial acquisition cost of these two items combined is approximately $1500)

4.)By embracing technology such as bypass oil filtration systems(which vitually eliminate oil changes)maintenance costs are much less than .08 per mile on a new truck with full warranty. That may be what some lease purchases require as part of the contract, however the origin of this thread was asking about owner operators and not lease purchase operators. our actual maintenance costs are more like .05 per mile. That equates to a savings of $3900 per year based on the miles in your example.

5.)Medical insurance and disability insurance(I do agree these are vital) are personal expenses and NOT business expenses and should be eliminated from the discussion. You can ask any accountant and they will tell you that. Liability insurance is the sole responsibility of the carrier whom is providing operating authority and cannot be charged to the leased-on owner operator per dot regs.
- Occupational Accident Insurance(which is all that is required if the truck is driven by the owner. If the truck is driven by an employee,then the more expensive Worker's comp. insurance is required.)costs around $120 per month.
- Bobtail Insurance can be had for about $40 per month.
- Physical damage insurance on a brand new tractor will run about $300 per month.
- That is a total annual Insurance cost of $5520 per year for all insurances required for a leased-on owner operator. This equates to a savings of $4480 based on the figures in your example.

The summation of all the previous monies saved comes to $39,218.42. So when this is added back to your previously stated bottom line of 24,098.42, you come up with a true bottom line income of $63316.84 before taxes. And let's face it, when people talk about annual incomes they talk about the gross(pre-tax).

Being a successful owner operator is not rocket science. It just takes hard work, discipline, and good business skills. The numbers used in this post are all actual numbers based on my operation as compared to the flawed numbers in the quoted example. They are not the total picture though as I have added expenses due to operating under my own authority and the example in question was a leased on owner operator. On the same token, I also make an average rate much higher than the .90 per mile used in this example.

 

Eskimo sounds like you are a successful business owner. Congratulations. The only disagreement I will offer for your last post is fuel surcharges are not necessarily passed thru 100% to lease operators. There is no law mandating this and many carriers will skim a large chunk of this right off the top.

As a company driver now I actually make more than I ever did as a lease operator (after all the business deductions). My best company earnings so far was a little over $75,00.00 with 100% paid benefits through my employer. I only worked 11 months out of 12 to get that too and was home about 40 hours per week on average.

True o/o's, as you seem to be, actually have their own authority and negotiate freight rates. Many do not have the business acumen to negotiate a fuel surcharge at all. This is a big reason why so many fail. I believe the majority of aspiring o/o's actually do go through a lease/purchase and ultimately more do fail than succeed.

As you pointed out I failed in my attempt. That is fine I accept the criticism. I guess I am in good company (considering the tens of thousands that failed before me and the thousands that have failed since, and continue to fail today). I realized driving for someone else is less stressful over all and is less of a gamble with my financial future. Considering all factors I still think leasing is a BAD deal wether the after expense amount adds up to your figure of $63316.84 or my figure of 24,098.42, or anywhere between the 2.

The lease operators, and o/o's I have spoken with over the years all have claimed they do not pay taxes at all. They write off as many expenses as they can and probably do in fact lie on their road use tax and fuel tax payments as well. There are many reasons for this as I have stated in other posts such as alimony, child support payments, or just a general displeasure of paying taxes.