Crst malone - good idea or not?

This is my first thread and i am completely new to the trucking industry. I apologize in advance for any ignorant or just plain dumb statements or assumptions.


I am considering partnering with a long-time friend to start a small trucking company. Our goal is to start with three truck/trailer sets.
That being said, I have contact a CRST Malone recruiter and the figures they are talking seem decent enough. Here is the break down:

1. CRST-MAlone recruiter said my drivers will average 2500-3500 miles per week
2. CRST-Malone will pay me $2.00 per mile. This includes the FSC. That 2.00 is AFTER they take their cut. so i use 2.00 per mile to pay my driver, my fuel, insurance, maintenance, escrow, etc
3. I can buy securing equipment for 2400 per truck, and pay it out over 24 months
4. I was told they take care of setting up the loads and getting my drivers moving and keeping them moving
5. CRST - Malone says i operate using their authority, their collision and load insurance. However, i may get additional insurance for my LLC...good idea or over kill?

Does that make sense? Does it seem above board and honest?
I calculated a cost/profit analysis using 5.5 MPG, averaging 8750 miles per truck per month at 2 per mile and the numbers look profitable. is there something i am missing?


I know these seem like very basic questions, i just need honest answers from people who actually know this business and possibly this company. Any and all information will help, so please feel free to write novels on here for me, because i promise i will read every word!

 

Oh my back ground!

I recently finished my tour as an active-duty Marine combat correspondent. I transferred to reserves in August. I am just trying to get going with something and my long-time friend swears trucking is a booming industry capable of producing profit.

 

Allow Me - thanks for the response! I will be sole owner of LLC (TTS, LLC) and my "partner" will be a driver/general manager.

Essentially, he has bad credit. So making him a partner (owner of LLC) will make it extremely hard to get financing (done through LLC with me as cosigner)

So, i will NOT drive. however, my "partner" will drive.

He will get a weekly paycheck of 25 percent gross profit from his truck, and 10 percent of the fleet profit monthly. Our contract will stipulate he has the right to buy back into the company 12 months after start date for exactly 50 percent of original loan cost. So if we get a 250 grand loan...he has 12 months to work out having 125 grand to pay me for half of the company.


As far as numbers go...i calculated my cost/profit table using the following numbers

8750 miles per truck per month
3.75 per gallon of fuel
5.5 MPG

i am trying to create a realistic expectation and not highball my projections. However, here are the numbers actually given to me

National Diesel average yesterday was 3.43
Malone says trucks average 2500-3500 per week (meaning if we hit median of 300 0 miles per week, trucks surpass calculations within three weeks, and truckers can take a week off per month)
"Partner" thinks trucks can get 6-6.5 MPG

I have a detailed spreadsheet that i am more than willing to allow anyone to look at that may be able to help me correct mistakes in my fixed cost assumptions etc.


Equipment Cost - i am ignorant to what a truck actually needs for securing equipment. I know that 2400 per truck will cover what they require for chains and bindings, straps, tarps etc.

 

Semper!

Thanks for the information. The reason i am using a $2.00 per mile figure is because the recruiter i am using as a POC stated $2.00 per mile. He explain to me, and this is almost verbatum, that CRST-Malone will bid loads at a price that allows them to pay me $2.00 after their 25 percent.

So I think that as long as CRST-Malone is assigning me loads/routing, they will ensure they hit that $2.00 mile average. That 2 dollars they included the FSC.

So, from what i understand, if i find my own loads and plan my own routs, i will be paid 75 percent of line haul and 100 FSC. So if i am finding/planning routs, it becomes my responsibility to ensure i make 2 dollars after they take their 25 percent cut?

any help clearing up my confusion? i am probably as green as they come here! haha

 

Runningman - Finding my own loads shouldn't be so bad then. I won't actually drive, my entire purpose is managing loads, planning routs, paying my drivers etc. So, if i am here all day long i am sure i can plan those routs. Heck, hopefully i can, with that kind of time on my hands, plan routs that will ensure i am not putting anything on my trucks that grosses less than 2.00 per loaded mile.

I do live in texas! My end goal is to entire the oil field services industry. I would like to use Malone so that my trucks can hit the ground running and start making money. However, i am going to start bidding on hauling cuttings and other oil field byproducts ASAP. That way i can have drivers on a set schedule, home much more often and paid hourly!

Another great thing about this is, i do NOT need to draw a salary from the company for at least the next 12 months. All profit will turn into working capital/cash injection for the company. Honestly, i want to pay my equipment off asap so i can start expanding.

Does that make sense? Also, if anyone here is an O/O, i have a cost/profit chart i would love an experienced guy to look at for me to make sure i am not forgetting any major costs.


thanks for all the information so far !!