Are O/O A Dying Breed

It's all in the numbers, I can see why someone would give up there authority to run under someone else. Most O/O out here run for a carrier, doing your own authority takes a lot of work and when it comes right down to the numbers sometimes it just doesn't make financial sense.

 

There are several reasons to lease on to a big outfit like Landstar. There are several reasons to run under your own authority. Your guy with his 4 trucks, he should have went out and got his own contracts. Why deal with brokers if you can line up a good shipper? Cut the middle man out. Now if running load boards was his bread and butter, he may as well go to Landstar, especially if he can get in with an agent with consistent freight. Makes the job worlds easier when you don't have to play phone tag with brokers all day every day.

 

Your boss has made a mistake. That move will cost him 35% of the load per truck (if he uses Landstar van trailers).

4,500 (gross) X 48 weeks (work) = 216k
35% (landstar fee) X 216k = 75,600 (per truck & year)

Lots of folks probably gross higher, so it translates to higher fees. Your boss should have hired someone to do the paperwork.

 

O/O are dying out because of the increase in insurance

 

That’s assuming he was booking loads at the same rate as landstar. Someone out there is taking loads at cheap rates. If that was the case here then it’s possible he could actually net more money.

 

Does he have the time, resources, and manpower to go out and get his own contracts though? It takes a lot of time and with only 4 trucks it's not like hes offering enough to increase he likelihood of getting those contracts

 

Where have you seen increases in insurance, and if you know, what's causing these increases?

 

Every year my insurance gets cheaper. The longer you’re in business it should be going down not up.