Buying a trucking company

That’s way too high. That equipment is worth 60k tops. Likes been said who’s to say he won’t spring up another business and bring those two owner ops with him? All they are is revenue potential and nothing is guaranteed.

This business is on its way out and he’s trying to cash out. You would be so much further ahead to start this from scratch and build it up while you learn the business at the same time. That way, you might make it. This way I’m 100% sure you’ll fail.

 

Does the seller have a funny accent and asking you to pay with gift cards? Asking for a friend.

 

Yes for 280k you could buy a brand new truck and a lot newer refer.

 

Insurance will eat up a lot of your 50k.

 

...and couple years old clean mc

 

That really is way way too much money.

Here's a couple of things to think about.

8-year-old truck with 750,000 miles is headed for a rebuild unless they have paperwork.

Vehicles that get to be around 10 years old is when they really start having a lot of problems. If he has no receipts to show you for work that's been done on that truck, it may cost you what it would cost you to buy a whole other truck.

ESPECIALLY IF YOU HAVE TO PAY SOMEONE TO DO IT.

I'm assuming you don't know a whole lot about reefer freight.

Reefer Freight has incredibly expensive insurance. Incredibly expensive. I'll say it again. Incredibly incredibly incredibly expensive.

The reason for that is because when you have a tractor trailer load of chicken or ice cream or whatever it is, and it gets rejected, somebody has to pay that claim.

And it's something that happens quite often in that business.

You have a trailer that's nearly 8 years old. That engine needs to run on that trailer 24 hours a day and never give out or else you're going to have a claim that is completely and totally 100% your own fault, because everyone that pulls a reefer knows, old reefers are only going to cause you claims. And problems. And problems with Brokers and shippers and receivers and insurance companies.

And of course time down because anytime the truck is down and not running it's costing you money on top of whatever repairs or claims or anything else cost.

And if you're thinking you'll just put somebody in the truck and they'll go run it, reefer freight is notorious for driver sitting there for I don't know maybe 10 hours 12 hours sometimes they'll sit there for 20 hours or several days.

You'll have to figure out what to do when your truck is sitting and not making a penny and you have to compensate the driver and the truck's not rolling.

You're going to love when you get to the discussion on drivers and hiring them.

And I'm going to tell you, I haven't even begun to scratch the surface of what can go on in this business. Trucking business owners agree this business is not for the faint of heart.

Either this person is misleading you, or you are misleading yourself.

I would strongly advise you that if you have money to invest that you find some other way to invest, buy real estate or something like that.

Or else get your own authority and drive your own truck and pay the insurance and build a business that way.

All of your mistakes will cost you money, until you learn, but the overall cost will be way less than going into any kind of a horrible terrible rip off deal like that.

I'm sorry to say it that way, but that's exactly what it is.

 

ok how many contracts are going with the purchase?

four or five?

running a company off of a load board is not how this works,

Ok so then you have a lawyer and you are doing your due diligence, seeing the books and talking to the drivers, etc. …?

why would you move the authority under a new entity?

is there outstanding liabilities involved?

is there an issue with the contracts?

you do know that when this happens, it will be treated as if it is a new authority?

 

How long has the current owner been in business? What does his profit and loss statements show? Does he have a contract with his current customers? This is just a small list of questions that you need answers to. Since you are putting borrowed and your own capital at risk here, you may want to hire a professional to look at this venture from top to bottom.

 

The sellers customer base, if any, is most likely negligible. Forget those o/os, they come and go, they are hardly any asset.

I don't know what good buyng a clean and aged MC would do, if insurance carriers will continue to underwrite it with thus far premiums, if not, then it just looks better, that's all.
Other than that, as recent as the last week, brand new trucks and trailers were sitting on the dealers lots.

 

Way, way, too much of an asking price. If you even have a shot of this working, you need a different approach. What you are buying is a truck & trailer, thats about all. Maybe some ‘good will’ for the years the current owner’s time he put in the build a customer base. Commercial lenders don’t lend against ‘good will’ or what some call ‘blue sky’, so there’s no reason for you to outlay a bunch of cash for it either.
If you are bound and determined to go down this path, offer what the equipment is worth, then come with a deferred payment schedule for the ‘blue sky’ tied into continuous patronage of the customer base at the time of business purchase. A certain percentage of revenue from existing accounts goes to the seller for 1 year, then year 2 that percentage drops, the year 3 drop some more, and the end of year 3, the seller is fully paid.
Have the seller sign a ‘non-compete’ clause of at least 5 years, barring him from any
participation in the industry during that time. As the O/O’s, maybe ‘sweeten the pot’ for them a bit, for a year or two, to encourage them to stay on.
This will be a mountain to climb, this type of venture is ‘asset low’ but ‘blue sky’ high.