Operating Authority

yes anybody can get their own authority, just go to the FMCSA website. .

that being said sounds like a real shaky business plan you got there..

 

I am not trying to rain on your parade, but both you and your friend need to find a company driving job for a year or two before you get your authority and start spending money. That $200,000 can disappear very quickly with the wrong decisions. This industry eats newbie's as a snack. Like any business, you are going to increase your chances of success dramatically, if you can get some first hand experience FIRST! There are a few who have started the way you plan on going, but it is very expensive learning using your own money. Most of us who have our authority drove a company truck before going out and buying our first truck. It isn't difficult to get your authority if you have money and insurance. Operating authority costs $300 if you do the filing yourself. You will need insurance and registered agents for all states in which you plan on operating. Getting the authority is the easy part. Finding decent paying freight and learning where the better paying freight lanes are is the difficult part.

In fact, you and your friend could run team for a carrier such as Covenant or one of the other training companies. By running together, you will see how well you get along in the truck 24/7 while learning something about the business. Most carriers won't lease on an inexperienced owner operator. Most insurance companies won't insure anyone withing experience. Some require as much as 2-3 years experience with a good MVR and CSA. Just because you have the money to do something doesn't necessarily mean that you should. At least not until you gain some experience. You don't even know if you will like the business or whether you and your friend can get along for weeks at a time in the same truck. I have made an assumption that you and your friend want to drive team.

Regulations are never ending in this industry. I have lost count as to how many times they have changed the hos, just in the last 10 years. If you run under your own authority, you will be expected to know and understand most of them. JJ Keller sells handbooks online and you can also find them in most truck stops. JJ Keller has a subscription you can buy where they send you new updates to regulations as they happen. There is a sticky on this website that tells you step by step how to get your authority.

I would caution you once again, to get some driving experience before you start spending your money. A little patience will go a long way toward insuring your success. Starting out and getting your authority without any experience is asking to fail. I have been at this for a very long time. I have seen many come with great expectations only to fail. I don't like to see anyone fail. By all means continue asking questions and learning. There is much to learn about this industry. There are many who have come into the industry who should never have gotten their CDL. By taking it one step at a time, you will be building your career on solid ground. As long as you have the money, you can buy a truck and trailer. Get your CDL, find a company job for a while and then after a few months or a year, see if you still want to buy a truck. Having at least 1-2 years experience will make a major difference in your insurance rates and opportunities that will be available to you.

Some questions you should be answering are the type of freight you plan on hauling and where you want to run.

 

double on the newbie for snacks.

i recall a pharmacist, a few years back. that lost it ALL in 3 months. and when i say ALL. i mean the house, wife, and kids.

 

Most segments of this industry has seasonal ups and downs. It isn't usually that difficult to find loads. It can be much more challenging to find decent paying loads. You need to spend more than 3 months behind the wheel before you start hiring drivers. This is not a get rich quick type of business. It is very capital intensive and many lose their shirts. On the other hand, many of us make an above average income. If you only have a single truck that you plan on putting a driver in, then you may not see that much profit. It costs a lot of money to feed and maintain a truck, even with a good driver that takes care of your equipment. You can go along just fine for several months making a profit and then several things go wrong with the truck and there goes your profit. Someone is going to have to spend the time to find and book loads and to dispatch your driver. Someone will need to be available 24/7 when your driver breaks down. If you want to make money in trucking and not drive the truck yourself, you need to plan on buying several trucks as soon as possible. Whether you have a single truck or several, some of them will sit idle for periods of time due to not having a qualified driver or breakdowns. Drivers will move from company to company for no apparent reason. The truck will sit until you can find another driver to take his place. You NEVER want to hire a driver just to fill the seat. No matter of how well you check out a driver, you won't know how good or bad they are until later.

 

Your problem will be coast to coast serviceability. The parts for macks are not as abundant out west as here.

 

When I look at buying another truck I have a list of "must haves." Those are deal breakers for me. I also have a "wants" list of things that I would prefer but they would not be a deal killer for the right truck and price. For instance, I prefer CAT engines, but would buy a truck that had Cummins or Detroit, provided that it had most of the other features that I wanted. A Mercedes, Mack or Volvo engine would likely be a deal killer for me due to potential problems with parts and repairs on the road. I usually buy a truck that is a good value for the money and meets my needs. I have had very good service from International. You can get more truck for the money with International or Freightliner than most other brands. They tend to depreciate a little faster than the Paccar trucks (ie- Peterbilt and Kenworth). Both International and Freightliner have proven themselves to be reliable in a fleet environment. Volvo has also proven to be a reliable truck and can often be purchased for less than the Paccar products. You can sometimes buy two of either of those brands for a comparable Paccar truck. A lot of drivers fall in love with a particular brand. I have owned most brands over the years. I would stay away from Mack and any truck that has a brand specific engine. For instance, Freightliner has Mercedes engines in some of their trucks. Mack and Volvo also have brand specific engines and components in some of their trucks. It can put you in a bind if you break down and need parts or service. One reason for suggesting you spend a year or two driving is so that you can get a feel of what it is like to operate a truck. It will also help you decide what features are important to a driver. Drivers want comfort and reliability. Owners want reliability, efficiency and value.

I like a 10 speed transmission for general purpose driving, but a 13 or 18 speed also have their applications. I would stay away from the auto transmissions in big trucks. Repairs are really expensive and many drivers don't like them. Most of the major brand trucks offer a quality product. Unless you find one that has brand specific engines or drive trains, most class 8 trucks are pretty much the same if you take the skin off the frame. Some have more driver comforts and features that are important to drivers. If you plan on running coast to coast, you will need to buy a newer truck that is "CARB" compliant. Beginning in January, California will begin enforcing their own CARB requirements for class 8 trucks. You will also need skirts around a van or reefer trailer and reefers will need to be newer or retrofitted in order to meet their state requirements. That means that instead of being able to spend $20,000 for a good used truck, you may need to spend $50,000 or perhaps more. Due to the new requirements, you will need to buy newer equipment to start if you run California. I am only using $50,000 as an example. I have not been checking prices for newer CARB compliant trucks and trailers recently.

Failure to adhere to California CARB standards can be expensive. You can learn a lot by driving a company truck before you start buying your own equipment. When I am dispatching my trucks or looking for good paying loads, I can spend much of the day on the phone and computer. Each load is a negotiation. When I had trucks running the left coast, I would be looking for loads from the minute the truck was loaded. Sometimes you get lucky, but California is something of a wild card. It will take time to find good loads. I would not count on doing it part time, especially starting out. Dispatching trucks is time consuming, even for a single truck. You might get lucky, but I would not count on it.

Finding good drivers is key to making money in trucking. All carriers, large and small, have a high turnover in drivers, with few exceptions. The best way to find out what to look for in a good driver is to experience the open road for yourself. I have driven in every state in the union, other than Alaska and Hawaii. I have also driven in Canada. If I have a driver tell me something, I know from personal experience whether he is likely telling me the truth or not. Drivers hate to sit and wait on loads. When you run the left coast, you can usually expect to do some sitting. Once you establish some contacts, you will find that it will be easier to keep your equipment moving. One advantage to running coast to coast is that you have more time to find a good return load.

Starting out you won't know your operating costs. Knowing your costs of operations is critical to any business enterprise. There is a sticky on this forum that has a breakdown of estimated costs, as I recall. OOIDA also has a spreadsheet that you can down load from their website that you can play with the numbers to give you a better idea of what it will cost to operate a truck. There are many variables. The only way to get real numbers is from historical data and that comes with time. After a year has passed, you will have actual costs that you can plug into a spreadsheet to give actual costs of running a truck. There is always something that will happen to skew your figures. A few years ago, I had a truck that had little maintenance issues other than the usually tires and simple problems. Then, I had to replace a transmission and do some additional work. I spent over $11,000 on just that one truck in a single year. Fortunately, I didn't have to worry about making truck payments. I suppose you could say that the money spent was comparable to truck payments. That isn't the norm for me to have to spend that much on maintenance in a single year on a truck, but it can happen. In fact, you could have to spend considerably more in the right circumstances. Reefers also require more maintenance. You should be prepared for the worst that could happen.

Many people come on these trucking forums wanting exact costs of running a truck. You can have 10 different owners and each will have different costs and breakeven points in their businesses. What some of us have done is give a good estimate of what it costs to operate a truck based upon our personal experience. It is a starting point.

Although I believe that I stated that you need to purchase several trucks as quickly as you can afford it, I would not rush out and buy 3 or 4 trucks when you first get started. The reason for buying several trucks is so that you can maintain some profitability when you have one or more trucks sitting and waiting on a driver or due to a major breakdown. I think that you are grossly underestimating the time you will need to spend running a trucking company.