Starting a company - can this work?

with your own authority, you need some core shippers, load board only for getting your trucks moving if no shipper frieght around, also the cheapest truck ive seen is a 2013 with 239,000 miles, payments are 1345 a month; without apu ave idle fuel cost is about 4500 a year, if otr .45 may work to start but most with experirnce and clean mvr, and csa will want more, i wont drive a company truck for less than .50 all miles, 20 yrs, clean mvr, clean csa, no frieght claims, out of 130,000 miles you might get 98,000 loaded, you have to figure 25% deadhead unless you find out and back loads, and to get 130,000 miles you have to add 10% out of route miles for fuel and maitenece cost, if your buying your own trailer, most i have seen for a 5 yr old dry van are running 400 per month, more if reefer and flat. i have my own authority and have found that leasing to a carrier being small is more profitable in long run. just my opinion.

 

I think your big mistake is figuring 130,000 miles per year per truck. That's 2500 miles a week for 52 weeks.

Never going to happen with down time for maintenance and vacation time for drivers. What about sick time?

Then there is the ELD implementation that will also reduce miles driven.

 

This is the best post.

The problem OP, you are asking the wrong questions for the right reasons.

If you want to know how it works, it is hard to understand what to ask.

The business end is made up of a few parts; capital, management and resources.

You need to understand how these three work together and where you have to control each to leverage them to make a profit.

Most think it is only money and money left over are the profits but that's not the case, the hardest thing to do is manage and policy making.

Managing capital isn't hard, you set policies and stick to them no matter what. It is making sure that those management policies stop from scope creep of the business that becomes hard like ending up depleting maintenance funds because you seem to want to get more toys or another truck to cash in.

Managing resources you have is limited by external forces (primary drivers) while policy making is an ongoing PIA process to change your approach to problems and uses of resources. I posted a little about my hiring policy here to give some an idea what I actually do because drivers are the hardest asset to find in this industry and I hate it when I have to waste my time to go through an app to only find that the applicant can't drive because of the five preventable on his MVR and he said he has no accidents.

I make less money than an O/O does per truck but I also use economies of scale leveraged into bigger profits than an O/O could make overall.

My approach is simple, I treat this as a business, no emotion, no getting all bent over stupid crap. Me and other fleet owners talk a lot, we all see issues like ELDs as not a problem that can't be solved but a problem that needs to be addressed as a whole for the business so we embrace the move forward (which this is just another little issue for us to deal with) and do just that, move forward.

I was just listening to a pod cast about Financial Technology and how the banks over in Europe are moving to a new business model for lending, with more AI and more hands off approaches to lending. We in this industry seem to be stuck in the dark ages when it comes to simple management of our fleets, we lost sight of the horizon and many think only about the next load and maybe the load after that.

 

One other thing I see missing is taxes on driver pay. SSI and workmans comp being the two I can think of off hand. Plus 0.43/mile is not quite bottom of the pay scale, but it's not far from it. Most drivers with clean mvr can make much better, so you will only get drivers that will be tearing up your stuff.

 

Breakdowns,accidents,drivers with personal issues needing to go home etc etc.all will effect that 130k mile number.Truck replacement,taxes,cancellations.Things never quite turn out as forecast!!

 

Yea, I would be surprised if after all is said and done that 100k to 110k miles is a realistic average for the year.
I'm not one to know really. My first year was Swift, and basically regional. 2k miles was a busy week. ANd now doing local runs, about 300 miles a day.

 

Do you have any business experience, degree? If not, starting a fleet, regardless of how good your intentions are, let alone a single truck operation under its own authority, will be the fastest way to burn away all that capital.

Drive for a few years, learn the in's and out's of the driving part of it all, then get some mechanical experience, then go about doing some investing.

When I first started in this industry just over 2.5 years ago, before getting my license, I was all gung-ho about owning my own truck as soon as possible. How could I argue with $150,000 a year gross!? Being my own boss!? :O

Then I started driving the things and realizing how much WORK is involved in just driving it. Looking at the business aspect just made my head spin.

Now, if I had capital, investing in a truck would be a no-brainer. I'm comfortable behind the wheel doing the work, so I can begin introducing other aspects if I wanted to rather easily. Would I want to run under my own authority struggling to find loads on load boards?

LOL

No, I'll run under my current carrier's authority pulling their trailers. They have a lot of gravy loads that they are eager to move and give the few O/O's we have on a regular basis.

 

With only three trucks ,would you not be driving one yourself? So that's one wage packet you have already saved and then again with only two drivers plus yourself why would you need an office person ? So there's another $43k saved and you wouldn't need an office so that's another $24k. Just saying.... l had ten staff and worked in the business as well as on it. Sure l was doing 80-90 hours a week , but to start out You just need to be focused.