Opening up a trucking company. Limited experience. What could go wrong?

Discussion in 'Ask An Owner Operator' started by ShaftSlinger, Jan 14, 2017.

  1. ShaftSlinger

    ShaftSlinger Bobtail Member

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    Hey guys. I have hesitated to post this because I see what tends to happen to guys starting out in this business but I'm giving it a shot.

    I joined this forum about 5 years ago to try and sell diesel fuel because another business I was in was producing lots of perks at a local store that could be turned into thousands of gallons of fuel. Refer to thread from 2011 on that.
    http://www.thetruckersreport.com/truckingindustryforum/threads/diesel-fuel.143813/

    Well that kept going and I muddled through selling fuel for a few years now at 25-50% off. After a while i realized I was giving away a hell of a lot of money and thought hmm I should buy a truck. One of my buddies had started a small trucking company. 6 trucks and was open to the idea of me leasing on. He would manage the drivers and all maintenance for 15%. I had to pay for actual cost of maintenance and now a few months into it I'm in charge of finding drivers too.

    Anyway I bought one truck a 2006 freight liner and we put it on the road. he is hauling brokered freight and we have been getting 2500-3500 miles a week. So far it seems like when the trucks on the road it makes about 1500-2000 a week after accounting for fuel drivers wages pm and insurance. The holidays killed me because the whole fleet was parked and there was a 3 week period where we had no driver because we fired one. But this looks pretty profitable to me so far.

    So I bought another truck. A 2006 freightliner again. And put it on the road. Same result again. Now mind u I am also now able to sell my fuel essentially to myself at full price which is good for about 4-5k a month over what I was doing originally but these trucks seem profitable. I also just bought a 2013 cascadia. I'm taking delivery on it next week and just going to follow same formula

    What am I missing here. I read all the doom and gloom but out of all the businesses I've been in this seems pretty easy to me.

    I'm buying everything all cash and I'm buying brand new trailers too. So maybe I'm just lucking out?

    Both of my 2006s are million mile trucks but have documented in frames in last 100k

    Been in business since October 1
     
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  3. ShaftSlinger

    ShaftSlinger Bobtail Member

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    I wanted to ad I think even with truck replacement built in and all other known costs I think the break even cost on 3000 miles a week with driver is somewhere around 1.20 a mile.

    I figured in. 12000 per year in maintenance and pm. To arrive at that number. Even if you figured in a higher number though it doesn't change much. For 2400 a month u can have a new truck but then your depreciation is a lot higher.

    I'm still trying to figure this part out.
     
  4. cnsper

    cnsper Road Train Member

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    You have other income to keep food on your table. You also seem to be level headed enough to put money away. But 4 months into it that pile of #### still smells like a rose.

    You are also not leased to a mega pulling loads for $1.10 a mile. Or getting paid $.65 a mile because the plates and insurance are "FREE". You also do not have a $4,000 a month truck payment.

    My last employer bought an International because it still had one year left on the warranty and was cheap. I told him he was an idiot, warranty does not prevent breakdowns. You were smart to get trucks with documented inframes. Most see the shiny truck and all judgement falls out of their ###.

    As to what can go wrong? Your driver could hit a school bus. Protect yourself in all aspects such as corporations owning the trucks. Basically you act as a lease holder.
     
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  5. cnsper

    cnsper Road Train Member

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    How much of that payment is interest? I will NOT send a bank $10,000 a year to avoid paying taxes on that money.
     
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  6. ShaftSlinger

    ShaftSlinger Bobtail Member

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    I don't plan to buy new seems like you just run to pay depreciation then. Clean used seems to be the best route to me at this point.
     
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  7. ShaftSlinger

    ShaftSlinger Bobtail Member

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    I have the trucks in an llc. And they are leased on simply as an asset so I think we are clean there. Also I paid an accountant and my attorney to review the structure and lease and they we're happy with it.
     
  8. nax

    nax Road Train Member

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    @ShaftSlinger ...There are MANY, I repeat, MANY naysayers in this forum...yet, I see people getting in and making it work

    If you can hustle, then you can make it....that's my mantra

    I think this industry has long been dominated by folks that dont think clearly and when SHTF....it goes down quick.

    I love stories like yours, which allow me to block out Naysayers...and I plan my entry into the game too.

    Good luck...and keep on slingin'
     
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  9. danny23tx

    danny23tx Road Train Member

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    I think ppl struggle to stay a float and they come on here and tell others they can't do it based on the fact they themselves can't run a bussines. I know drivers leased on and with own Authority doing well . You have a good plan seems to work for you , congrats !
     
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  10. blairandgretchen

    blairandgretchen Road Train Member

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    On your 2500-3000 miles a week, I would be setting aside .20cpm for maintenance - you currently are doing .10 cpm on the low end.

    At the end of the year if there's leftover, you can tip it into the big jar and start again.

    The $1.20 figure that includes replacement - seems a bit low too - but you'd have to lay out a better documented explanation for (at least) me to understand. (Not that you have to).

    Glad you're making it work so far.
     
  11. x1Heavy

    x1Heavy Road Train Member

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    1.50 would be better. The extra .30 goes into the back pocket against really bad days that are coming. Not if but when.
     
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