good business plan?

If you plan on 10,000 miles a month that is 120,000 a year, a full time job for a single driver, why rent? rent never ends and if you think you can pay the rent and save up to pay for a new truck keep dreaming.

New guy on the load boards, they will not give you the good freight, be very lucky to average $1.80 for the first 6 months. You might find 3.00 freight, but if it only goes 200 miles, you would have to do 12.5 loads a week to meet 10,000 a month.

Buy 1 good truck, put your butt in the seat and get your education before you go under big time. If you don't know it the hardest part of your plan is hiring drivers, good one aren't going to want to move all their stuff in and out of a rental every week.

 

Everybody here past right over the most important part of the question...is this a good business plan? If you have to borrow 72 k to cover your start up cost..I would say no no no no ...this is a horrible business plan..If dont suceed do you really want to be making payments on 72k of lost money ? I dont care if your loan is zero % interest rate.It is never a good idea borrow money to start a trucking business when the failure rate is soooooo high..if you want to make a million dollars in trucking you had better start with two mil...

 

Time for a reality check. To start with, you NEVER want to start a company with 100% borrowed money. You need some skin in the game. With your current business plan, you will burn through the money in a few months. I assume from your post that you plan on pulling vans. Some van rates are up right now, but will be down in the spring and summer. Your breakeven costs are much too high to make your operation profitable. Your breakeven costs should be in the $1.35/mile range for pulling vans. It is expensive to rent equipment. Most rental companies, such as Penske or Ryder only rent to established corporations with good credit. I have rented trucks when I have gotten in a bind and they are not cheap. It will be very difficult for you to turn a profit with rented equipment. You have also been out of the business for a while. A new authority may not be able to do business with some brokers until you have been in business for at least 6-12 months. On an annual basis, rates for vans have historically been under $2/mile, depending on where you run.

If you want to build a successful trucking business, start with one truck and drive it yourself for at least 6-12 months. Get a feel for the business as an owner before you start hiring drivers. Once you get involved with drivers things change considerably. Contrary to what some believe, a good used truck does not always break down on a regular basis. If you check out the truck, you can find a good truck for less than $20,000. I have seen some good trucks for sale in the $10,000 range. Even if you need to spend a few dollars on repairs, you will still be spending much less than renting a truck. The last time I rented a truck it cost me about $800 for a week. If you cannot finance a truck you will not likely be able to rent one. Those who do rent to you will likely require at least a $5,000 deposit on each truck. If you plan on buying vans, they are over priced right now. In fact, it is difficult to find something for a decent price due to that factor. Some shippers will not load a trailer that is over 10 years old. If you travel in California, you will need newer equipment in order to comply with their CARB requirements.

It takes a lot of time and effort to keep trucks loaded, profitable and drivers happy. You need to expect turnover, regardless of how well you pay drivers or how well you treat them. You need to take a realistic look at rates and costs of operating a trucking business. Whatever you think it will cost, you should add about 1/3 more to the costs. I guarantee you that whatever most people calculate as their actual costs, it will be too low. I will also guarantee you that you and most others are overly optimistic on the revenue you will be able to generate, especially starting out. With time you will build your reputation and establish contacts. I rarely post my trucks and mostly rely on personal contacts that I have made over the years. The best rates are RARELY posted on loadboards.

I don't want to burst your bubble, but you have gotten way ahead of yourself with your business plan. It is simply not realistic. The best data is historical data. That means that you need to buy, not rent, a truck and see how it goes. If you can and want to rent a truck to see if you can make it work, then do so with you as the driver. If you can't make the numbers work yourself, then you will not be able to make it work for a driver. Your figures don't leave any room for error. What happens to your plan if the economy takes another dip? Rates will plummet. If you want to make payments, you could buy several decent trucks for what you will pay out with rental fees. If you want to be successful, you need to slow down, take a few deep breaths and look at the real numbers. OOIDA (www.ooida.com) has a couple of spreadsheets for those planning on buying or leasing a truck. It isn't perfect, but it is a start to what it really costs to own or lease a truck. You can download the spreadsheet and play with the numbers. I am glad you are thinking this through and getting input from those of us who have been there and done that. I hope you take the advice to heart. Things look much differently when you go from a company driver to an owner.

 

You may be able to operate at say $2.50 cents and make a profit but there are atleast another 10 drivers that can operate for less and underbid you. Its all a gamble

 

Most auctions will allow bidders to check out equipment prior to the auction. You need to get to the auction early, preferably a day or two prior to the auction.