Total NOOB question

The answer to your question - for me, will be different to all others - but it is . . .

It’s not a horrible business. After 1 or 2 years initial experience, a solid business plan, financial positioning, an impeccable record, hard work, dedication, and some passion -

It’s an excellent way to make a really good living, whilst maintaining independence and flexibility.

The usual problems I see? Expansion. The problems are usually driven by an urge to employ drivers to generate revenue.

Good luck, whichever direction you go.

 

OK Then what is the gross of the load. the billable to the customer?

You need the actual miles driver both loaded and unloaded. You need to determine the deadhead percentage and figure that into the cost per mile. You can't write that off but it impacts your bottom line.

That's his problem, as I said don't get involved with "freinds", you get screwed if something they do goes south.

BUT it will be your primary business. You will be carrying the liability on the truck, not him. One accident, you get named in a lawsuit and can get screwed. Creating an entity that you think will protect your assets will not provide the protection with these forms of liabilities. Another reason why you don't get go into business with a friend.

First I would not buy a Volvo, it is an expensive machine that has limited dealer coverage and proprietary care. It isn't like a car where you can go to the local Emmet's fix it up shop and have it worked on.

Second mileage means nothing when you come down to it. what matters is the condition of the truck when it is up for sale. You have to do your due diligence which is time consuming and costly.

Again the driver's knowledge is useless, you have to deal with the truck as a business owner, not as a passive investor. Want to get screwed fast, let the driver run the business without being in the business.

They all do, but it costs money. I doubt you can get a loan floated for a $30k repair on a $40k truck through the carrier. A lot of these repair places are crap, you have to be choosy and learn about where to get it fixed right.

Just remember that your "friend" doesn't have skin in the game, he can walk away without any responsibility but I think what gets many people is this is a profession and not just a job or a business and to see someone enter into it and act like everything will work while others with years of experience struggle seems to indicate this takes more than just a driver and money.

 

I think somewhere in this thread you said those are Hazmat loads.

Here's my question. What happens if something happens to your friend? What if he has enough of you or what if he has a problem where he is sidelined meaning he's out of service can't drive anymore, or if for some reason he just had enough of you and he abandons the truck somewhere let's just say. Things like this do happen and drivers do get medically disqualified or failed the drug test or have a legal problem or whatever the situation is.

If there's a Hazmat load whether you have your CDL or not you can't pick that load up. A lot of drivers don't want to be bothered with Hazmat so the difficulties in finding drivers again are multiplied. What would you do if you found yourself in that situation? Someone that has experience in this business knows the answer to that without thinking.

You could find yourself with a truck that is far far away with a load that nobody can move and then what do you do? Maybe the company could find someone to move the trailer but what are you going to do if you have a truck that's 2000 miles away and you can't get it home. You can call the tow truck and they'll charge you about $5 - 10,000+, or they will charge you however bad they feel like raping you for that day.

But if you and he have some type of a sour relationship $5 -10,000 is going to be nothing in comparison to the amount that you will lose. You can't just simply hire another driver. You are putting all of your eggs in one basket that this one person that you know is going to do everything that you need and you even seem as though you're admitting it's a slim margin...

Maybe you should start thinking about this in terms of just simply financing the truck for him.

Really you don't know a lot about the business and you're trying to help a friend so maybe you should ask these guys how to set up at lease for him and every week you get paid your lease and it's some crazy outrageous amount of money because he can't get financed anywhere he can't get a truck anywhere he has no money he has no credit. You would be doing him and yourself the best favor to do this.

I'm sure there are other people better qualified to tell you how to set up a lease but if he was going to buy a truck at 20% interest, why don't you charge him whatever the number is 30% 40% whatever it is, and you just collect your money and stay the hell out of everything. Make a legal agreement like a finance company would. Unlike Partners in the trucking business, finance companies make a hell of a lot of money.

Since you have a super driver who only wants to work and work and work and work and just make money and he can make $7,000 per week, let him just pay you for the truck.

Charge him $2,000 a week. He's telling you that he can make such a great amount of money that's great! He can afford $2,000 a week and he just wants to live on the road and he can live on nothing and he works Around the Clock like you're saying.

At $2,000 a week it won't take you long to start having money rolling in so that if he screws you at least you got a good portion of your investment back, get rid of the truck lick your wounds and move on to something that is a real investment.

If he defaults, repossess the truck and sell it. If he does not default make a set period of time that you've made your money back.

If you spend $50,000 on the truck and you want $100,000 in return and if he works and works hard in one year you will have his very own truck paid off completely. Everybody's in a better place.

I suspect this deal would be over if you presented that to him because he's putting out nothing he's getting everything and he has zero liability. When you explain to him that HE has a certain responsibility to pay you every week, you may not see the same exuberance that you do currently. In this case, the tail is positively wagging the dog.

It can't work like that- this is just not a good idea. But at least if you're only financing the truck you have a better shot at making money. Let him worry about all the trucking stuff he's a super trucker.

All you have to do is count your money every week, just like the finance company.

 

Many on this forum stay company drivers all their lives and are happy. Although I agree with the words stated regarding friends,always take the advice with a grain of Salt unless its from China Town or a few others on here.

 

Why not just buy an agreed upon truck (by both you and the driver), and then you either lease or finance the truck to the driver while maintaining ownership? Let him run the trucking business. If he is a decent guy, he will even understand you making a little bit of profit off of the deal. You can set reasonable terms where he will eventually get full ownership. You can probably make more money this way than getting in the "trucking business", plus he now has some skin in the game.
If you are in this to help a friend out, and apparently are not aware of all the small details to run a successful trucking business, this is the easiest thing you can do to help him.. If things go bad, then you have to do a repo.

 

I didnt read the 6 pages of stuff. I got the jist of where this was going after 5 or 6 posts.

If you arent going to listen to advice, why did you ask for it?

People have said dont go into business with friends. That is sound advice. research THAT. Google something like "business with friends pros and cons" and read up on it. You seem to have your mind made up and all you are doing is defending your position against sound advice. So do it. And blame yourself if it does fail. Or do your research and understand what you are in fact getting into.

The choice is yours.

In summary, dont ask for advice if you dont want advice.

 

You do not want to go into Business with family or friends. Get good outside help.

My first job is actually with the family business with the understanding by all I probably will not be around it very long. But it's worth a shot because we all have to start somewhere. The Business itself eventually must fail because the customer base that once supported it literally died off. Slowly. But surely. You are not going to get 21 year olds to travel to that part of Baltimore to sit and drink like the old ones did before them. No. They are too busy doing drugs or playing computer games or clubbing downtown at hammerjacks. (Now there is a place...)

When you ask a question you are going to get answers. Some of them you are not going to like. I read most of the reponses here by others and they showed great value in their answers to you. In fact some of these show why I should listen to them myself now and then. They know what it is they speak of.

I have said before it is better to be a company driver for a few years in this industry and learn quietly. Before doing anything. The first time your engine begins to get seriously sick and your customers are calling you personally where is that 48000 pounds of Sulfiric acid my factory must have tonight before its forced to shut down a billion dollar operation because YOUR DRIVER did not get it there in a timely manner.

THAT would be enough to cause a complete and total failure of your then growing business. Snipped in the bud just as it;s reaching out of the ground in the spring time toward the sun. It didnt have a fair chance. If you are not structured properly that friend you hired who failed you will become a pernament enemy in life. You don't want that. I have enemies, but frankly they literally do not matter because there isnt anything worth remembering about them. They are dead to me. And so there is no problem. It only took 50 years to get that point.

I can go on and on but I wont. You have been told many things. I hope you think it over carefully. Reaching for that easy money might become a ferocious tiger that claw you to death. Businesses do fail in a variety of ways, sometimes quietly other times with a kaboom and bad feelings that last a life time.

Friends and family are good. Having them involved in the business IS NOT GOOD. Period. The moment you said the words My friend and I is... (Insert business) it's a no go. Im sorry, if you two want to be friends, find some other people to run the business and stay the hell out of it.

 

Bud,
Get as much advice from these guys as possible, some is good and some is bad. I have learned alot form these threads, I take notes ask questions and only a few have given really great advice. I jumped head first into this business with minimal knowledge and I'm glad I did. People learn from mistakes better than someone telling you "don't do it this way, do it that way" Go into business with your friend, who cares. I'm in business with my family and we are having the time of our lives!! We are making good money, our drivers are as happy as can be and we are having fun! Whats the worst that can happen? You loose a friend, family member and some money, oh well. There's nothing to it but to do it. I wish you luck in your endeavor. Dive in head first! Just make sure the water is deep enough.