Lease a trailer or buy one?

AND it is still worth something at the end of those 24 months. However, if you are dead set on leasing/renting a trailer you are correct you could do much worse. I think Penske or Ryder charges somewhere in the neighborhood of $650/month plus 0.06/mile. But use your noggin', if it wasn't better to buy would these lease places be in business ? of course not.

 

were? im just asking, because this may become an option. and all i get is these per mile + flat rate deal. if i had a flat rate only deal, i may actually consider. i never done flatbed, but for 700-750 month i may try it.

 

So how long did you "rent" to save up that $6200?


I understand the sentiments about "paying cash" for stuff. It really does make sense.

The option though while you are paying double, is the opportunity cost compared to the interest of financing.

So really to save $730ish in interest, you gave someone $xxxx amount of money.

This isn't just a comment to the OP, but in general and how it might apply to them.

I really wanted to save up the cash for all I wanted to by. What would it have gotten me though? It would have saved me about $2500 in interest in 30 months.

I would have had to saved that same amount in a similar time period. All for $2500.

What would I have lost?

About $35,000 in last wages/profit annually or more Over 2 1/2 years, about $90,000. That's just with the dry van.

Having just traded my van off, I figure I lost $2000 in value using it as a trade. It's costing me an additional $750ish in interest in 30 months.

But it's gaining me about $4500 in additional net profit monthly. Over 30 months, that's $135,000. I've gone from under $2000 net profit monthly to over $6500 and pushing north of $7000 net profit monthly switching from dry van to reefer. And it's not all about hauling produce. There's plenty other food stuff that needs to move too that needs refrigeration.

So in those 30 months, scraping and saving up $43,000 for a truck/trailer, and another 30 months for another $40,000 in operating cash, pretty much living on a shoe string budget to dream of being an O/O. 5 years of living like that takes a toll on a person.

I am going to toss away $450,000 in lost profit?

Sometimes financing just MAKES sense. That's ($90K+$135K)*2 for the 60 months you are going to scrape and suffer to attempt to save the $80,000 for operating capitol and equipment purchase capitol.

Yeah, those are REAL numbers too and I have the profit and loss sheets to back up those statements.





I just talked to a guy on Saturday. He's paying 12% of gross to his company for a 2001 reefer. Says it comes to about $1700 per month to make the "rental" payment. Figure he'd save himself $1300 per month over 24 month comes out to about $31,200 he's giving his boss. I can say that much because he's already paying for reefer fuel, maintenance etc out of his own pocket.


Not sure about anyone else, but $31,000 is a nice maintenance fund for most or a nice cash payment on a new piece of equipment after running an older piece of equipment for a time.

Opportunity cost, what are you giving up, when you compare two options.

 

United Trailer Leasing is 375.00 a month plus .04 per mile on a 53' air ride dry van. They do all the maint. Perhaps get a better deal on a longer term than a month.

 

That's a $775 per month payment.

What's to go wrong on a van?

Set of tires? $2800 over 2 years or less. Brakes, about $1200 if you replace more than just drums and shoes in two years.

So at 10,000 miles a month, you'll pay someone else $9600 for maintenance in 24 months for something that would cost you $4000 otherwise.

Lost profit? $5600.

 

Im not renting bud j do power only. Renting just add a bill go my already overcrowded kitchen table. I rather do power only til i get the money up. But idk, i may have to check on my financing options after this.

 

If i get the right price. Lets see if i can raise them funds without having them extra bills. The only two billx se need is Taxes and Insurance. And we working to lower insurance so let all other expenses be unforeseen. But as far as fixed expenses, i pay enough in tax. Dont need more.

 

best is to buy new one

 

Wouldn't owning your own trailer open up possibilities going forward? Sometimes it's not the hard analysis of what's in front of you it's the opportunities gained in the future. We find our customers tend to do better (i.e. control their own destiny) owning their own trailer; when practical of course.