$1 million Owner Operator

Their headaches don't follow them home and threaten their house anyway.

 

So I think everyone would like to hear what is your calculation for the number of trucks needed?

Of course I'm breaking them a little but you're going to get some eyebrows raised at the quite easy part.

It's probably comparable. I think you need at least three trucks to make what you make with one.

As far as never being satisfied with your goals, the problem is there's only one of you. You're not going to find 30 guys that are going to work like you.

There are some people that have money and you never know it. There are other people that look like they're doing great and the next day they're bankrupt. You never know.

As far as guys that have a few trucks or business of a certain size why do they not grow? Because they are in their groove. They have a size of a business that they can manage and that is profitable for them.

If the guy with three trucks decides he wants to go to 30 trucks then he has to take more and more money and reinvest back into that business. He needs trucks he needs trailers he needs drivers he needs office workers he needs software he probably needs a larger yard and garage and mechanics and maybe at least a small Warehouse, HR people payroll people/ accounting, operations managers dispatchers safety department recruiting someone has to Fire and hire and oversee and maintain. There is a lot going on there.

And also don't forget that every time a business grows there is turbulence. Large jumps in growth are not generally recommended.

And if the rates stayed where they are currently maybe it looks like 1 million isn't too bad. Right now is just overpriced trucks and trailers waiting for people to buy them for the rates to drop.

And I forgot to add you need sales people to go out and drum you up a whole lot of direct customers.

 

Let's say after every expense is paid what is the clear number for profit for the day. This was a decade ago I worked for a small outfit about 40-50 trucks. The finance guy said it was a clear $600 minimum a truck after all the expenses. If you figure that for 5 days for 48 weeks of working for the year. If everything runs wells I would say 10-15 trucks would bring it considering break downs & driver turnover, freight shortages etc. That's my estimate based of a clear number from what was told to me a while back.

 

The company I drive for has about 75 trucks and probably about 130 trailers. IIRC we clear about $10M in TOTAL revenue per year... Obviously lots of expenses come out of that before the owner gets his cut... But that might give you an idea.

 

On average a truck with a driver brings $20-30k profit. You can manage 5 trucks by yourself, above that and you need to hire some help. That will cost you let's say $50k. So it would be better to jump straight to 10 trucks and keep going from there.
Then the more trucks you get, the more office help you gotta hire, gotta have more spare trucks, a bigger yard, a bigger office space, e. t. c.

Profit per truck drops from $20-30k to 15-10-5 or whatever.
You can have a few million gross income, but net the same as driving yourself.

You think that you will find drivers that work as hard as you do, take care of equipment the same way and go home as rarely as you do, but you won't.

The only people in the last 15 years I have seen successfully grow from 1-3 trucks operation to a larger fleet are families (spouses, brothers, parents/kids), strong childhood friends or ethnic groups. Not counting baby boomers, back then it was a different business climate and a lot of people did good without anything mentioned above

If you can do everything on your own nowadays, you will be an unicorn.

P.S. in a strong freight market, like in a bull stock market, everyone thinks that they are business geniuses and things always go the same way. Try managing everything with 3-5 trucks for a year and than see if your calculations for that $1 mil profit were right

 

Most profitable businesses net about 10% of their gross revenues. To net a million dollars realistically would require 50 trucks grossing $200k each annually for ten million gross revenue. Ten percent of that would be one million dollars. Now if you can find 50 drivers that have the same type of drive that you do...then screw the trucks and start a driver recruiting business and become a billionaire!

 

Historically, trucking has very thin margins. These industry averages become much more important as you add more trucks. As @wichris said in Post #6; diminishing returns...

 

@Midwest Trucker has quite a few trucks I remember reading once. He might be able to answer some of your questions

 

Some fleets struggle...

And some solos do very well...