Landstar vs Independent

I'm making a similar move: just not from LS.
I already do all my own IFTA and NYS hut. Already pay my own plates.
Seems like the difference for me will be negotiating rates with a broker vs getting a set % on whichever load I take. I'm looking forward to being on my own. Learning curves and everything riding completely on me aside.
I'm following this thread intently; very interesting to see the parallels. Thanks Landstar8891 for putting yourself out there. I read hundreds of times more than I write. Good to have this thread pop up.

 

AH someone else that feels my pain Thank you sir. I just got my letter from DC sat and this week i will activate my insurance and get rolling on my own. Good luck dude keep us updated.

 

If you run your own authority, you don't need bobtail insurance. And the cost of authority that you noted. Is that what someone told you that they would charge you to get your authority? The filing fee is $300. I would also check around for insurance. It might surprise you how much of a spread you can often find between different insurance companies. Even though you are not required to have workers comp, you might consider buying an occupational accident policy. It is much less expensive than workers comp and will pay you a salary should you become injured while working. Some people don't bother to get a policy, but if anything happens where you can't work, that money could come in quite handy. It also cover doctor and emergency visits as long as they are work related. I had one on a driver who slipped and fell off the top of the step deck his first day on the job. I sure was glad that I got that policy, as was he.

 

I'm really not sure why people think it cost so much to be a O/O, insurance and IFTA are really the only thing you have to pay to keep running my insurance is less than $6,000 a year I cut a check and pay it in full $6,k you can do that in just over a week. IFTA I cheat I pay $25 a month for a tracker from AIR-IQ and I use a fuel card at the end of the quarter I print both off and takes less than five minutes to do it most quarters I end up with a credit and they have even sent me a check twice most I've ever paid was $143.
I've had companies in the past charge me $850 a year for new stickers but never ask for any fuel tickets so tell me how that worked?

landstar has always been at the top of my list but I must say things have changed for the worst over there. I did 42% of my loads thru them in 2010 and 2011 I did $84,000 gross with them last time I looked its only about $7,000 and can't tell you the last time I've moved a load for them and history repeats itself I always look and call on there loads first really not sure why I do it maybe because that's what I was use to. I've done more for CH Roberson than LS the rates and there sorry agents is the problem I was always getting offers at $2.20/$2.65/mi sometimes better last year my loaded miles with them was $2.94 all loaded miles I can't tell you the last time I was offered a load over the $2/mi mark.

the fact is the only TRUE freedom you can get is being a OO DAC,and ITS have five times the loads than anyone else yes it's more work at first but once your set up with a broker you don't ever have to do a set up packet again maybe just insurance but if you have a good agent like I do that gets sent out with just a click of a button.

Its not for everyone first thing I tell people if your not good at keeping up with truck and money don't do it because you can be your worst enemy!!!

 

What is AIR-IQ?

 

GPS tracking.

 

I have been a LS BCO for going on 9 years now. Last month on another Forum there were some inquiries about how much freight LS was brokering out now and how much the outside carriers produce vs BCO's so I volunteered to do some research and broke down the 2nd Qtr. 2013 report. This is what I found......the numbers speak for themselves, as for my synopsis that is just that, my opinion. Comments and critiques appreciated, Thank you!!



"OK, I have some numbers but they just won't post here worth a dmmmmm so I am furnishing a link and will do the math to answer your questions as you ask them...........these are directly from the latest quarterly report dated July 25, 2013 and show comparisons to a year ago as well. Probably easier to follow if you print it out.
http://www.morningstar.com/invest/a...arter-diluted-earnings-per-share-of-0-66.html

OK so scroll down to the lower section and you will find Revenue Generated (in 1000's) so add (3) zeroes to the numbers you see posted there so for this qtr ending June 29, 2013 total revenue generated was 679,340,000 down 56,633,000 from a year ago.....OK so this year in the 2nd qtr the BCO trucks brought in 341,499,000 while the broker trucks did 281,181,000 so divide that by total revenue earned and you will get a % for each category........so BCO trucks provided 50.26% of total revenue while the broker trucks provided 41.39%.......add those 2 up and you see where the trucks brought in 91.65% of generated revenue for this qtr..........now let's look at # of loads hauled and we find the total # of moves for the qtr was 383,820.........BCO trucks hauled 204,600 loads versus 167,780 the broker trucks so BCO trucks hauled 36,820 more loads than the broker trucks. BCO trucks moved 53.30% of the freight in the 2nd qtr while the broker trucks moved 43.77% or 8.2% less total # of moves. Revenue per load shows the gap closing over the last 26 weeks between the BCO trucks and the broker side from $18 to $7 but the broker trucks still have the edge on producing more revenue per load. I believe this was due to higher rates to BCO's during most of the 2nd qtr but I'm thinking this gap will widen for qtr. 3 as BCO rates have fallen again since Aug.1, 2013 plus outside carriers are probably better negotiators than most BCO's, but this is just my opinion. I know most medium to large carriers use load planners or sales reps who usually give a price and stick to it, take it or leave it.
LS is reporting the #of BCO owned trucks at 8,368 down from 8,478 a year ago. They report the number of active outside carrier trucks at 20,844 up from 19,283 a year ago with the # of approved carriers up by over 2000 this year to 11,228 from 9,051 a year ago. They count an outside carrier as active if they have hauled at least 1 load in the last 180 days.

I do not have numbers from say 3 years back but I will see if I can finds them as it will be interesting to see how far the brokered side has penetrated into the company's performance since then, maybe even back 5 years if I can.
No doubt the brokered side is growing quickly and does bring in slightly more $ per load than we do but I don't see LS throwing the baby out with the bath water at least just yet.....we still work harder and obviously a bit cheaper (so hone up on those negotiating skills and try to get more money on those borderline loads) but it costs LS more to operate us and that cuts directly into the bottom line as we all know. That 56+mill slippage in revenues in a good qtr kinda opens my eyes here as to the quality of the agent base these days or the freight selection being offered or maybe it's as simple as the competition stepping up their game....something to keep an eye on for sure.....Henry can't be too happy with that #. (I also believe some of this can be attributed to implementing EOBR's)
FYI, don't let the reported .66 cents "dilluted earnings per share" put a thrill up your leg. It's a way to figure EPS calculating for all outstanding shares accounted for including the impact all outstanding stock options and convertable bonds(IE: bonds to shares) would have on the EPS figure, in other words a worse case scenario as to how much the value of all outstanding shares offered in any form would effect (dillute) the average stock price over the last year.....it's a good thing to report it this way (a clean number) still it doesn't mean all is peachy keen, rosy posie, but as I've said many times, luv'em or hate'm these guys know how to work the numbers and operate the financial end of things.....it's the operational side that gives us all headaches!!!
OK now, so Fireball....to answer your query I figured the net profit per dollar to be .04478 cents after all expenses including taxes (net income) which was 30,426,000 so lets figure out how that breaks down between BCO's and broker trucks. So BCO's brought in 341,499,000 at .04478 per dollar for a profit of 15,292,325 or a 50.25% of profit vs. net income. Outside carriers at 281,181,000 turn a profit of 12,591,285 for a 41.38% of profit vs. net income.....which makes sense as since combined the trucks are responsible for 91.65% of total revenue so it follows they should be responsible for the same or close to the same % of net profits..........so you can see we BCO's still turn more dollars and therefore a higher profit % but no doubt the brokered side has made substantial headway.
OK, so if you have any more ?? ask away and I will try to answer them as best I can."
Later!!

 

My .02. In regards to costs and fees, you'll have the same fees and costs, and more going on your own. Sure you'll save on Unladen and load alerts, and you won't have to have Workers Comp/Occ/Acc (smart idea to have something unless your savings is to the point where you can survive a career ending injury). Being an independent, if you're a LLC or S corp, you'll need to file annually in states like NJ costing $500 a year if you pick up or deliver there. You'll also need to file your own tax returns and pay the ad valorem taxes in states like AR and KS. So there is some paperwork involved to stay legal and fine free. You'll need to pay your UCR which is part of that $200 permit fee. Bottom line, as far as leaving LS over so called "nickel and diming" a driver, your compliance expenses will be much larger, not to mention the time involved, and my time isn't free. You'll also be subscribing to at least one load board with their credit service which will be about $60 a month or more.
All that said, if your go-to agents will still use you for their freight, and pay you more, it could be a toss up as to whether all of the compliance and calling on 50 loads off of Internet Truckstop to get one with a decent rate is worth it. My go-to agents have said they have no problem using me if I reactivate my authority. I've gotten lazy though and I like seeing the money on every load on the board. To go back to ITS and negotiate 30-50 phone calls a load makes me feel tired. Good luck Mike in whatever you choose. I don't have a EOBR, and that could very well be the point that I reactivate my numbers should it be required. Until then, I'll stay a lazy BCO.

 

You might want to consider this as a viable option.

http://www.magcarriers.com/common/content.asp?PAGE=395