Here we go... finally a lease-operator!

Like the title says, I am a lease operator, not a true INDEPENDENT owner-operator. I found a decent company to work for, drove for them for a few months as a company guy, while pumping the owner-operators (for some reason everyone calls them brokers here) for info.

About a month ago, I decided to take the plunge and buy my own truck, to sign it on at the same carrier. First stop - Peterbilt New Brunswick. The sales guy there is my youngest son's hockey coach, so I figured at least he wouldn't try to screw me. I decided on a $45000 (CDN) 2005 379 and set about trying to get the financing with $9000 down. The result? PACCAR and 3 other companies turned me down FLAT. No cosigner option, NOTHING. This struck me as extremely odd, since I own my $195000 house outright, own my vehicles outright, and owe no money besides about $2k on one credit card.

Alright, so I decided to look at something cheaper, in hopes of getting in house financing. At Valley Equipment in Hartland, New Brunswick, I found 4 2003 International 9900i's. 3 of them had C12 Cats, busted windshields, and various other red flags. 1 had a 6NZ C15 Cat, and besides a bent front bumper and duct taped front seat, was basically sound. The price? $13K.

Here's where it gets interesting... they would not finance the truck in-house due to its age, so I thought to heck with it and went to my bank. I had heard that banks are not very trucker-friendly right now, so I viewed this as my last resort.

Imagine my surprise when my newly discovered "personal financial advisor" (gee, didn't even know I had one) told me that as far as the Royal Bank of Canada is concerned, I have A+ credit and "preferred client" status. What does that mean?

On the spot, with no other approval required, I was told I could have a $300K mortgage, a $40K auto loan, a RBC Visa Gold card with up to $100K limit, a $15K line of credit, and a $10K overdraft. Waitaminnit.... what?!?

I may not be the brightest guy around, but I'm not crazy either. I took a $6K auto loan at 8.5 percent to buy the truck, (12 month term, but can be paid off at any time with no penalty) the RBC Gold Visa card with $5K limit, the $15K rolling line of credit (doesn't kick in unless I use it, then I pay 6.25% on what I've used), and a $1K overdraft.

Maybe it helps that my banker/personal financial advisor is a former dispatcher for Day and Ross whose husband is a small fleet owner.

Here's the deal I made with my carrier: I make 90% of 88% of the total gross revenue, which works out to 79.2%. That includes the trailer rental fee. Twice a month, I pay pretty cheap insurance, $175 CDN reefer fuel, and of course, fuel, which is at the same price the company pays. Except for EFS, name a fuel card, and I've likely got it.

The company has its own shop as well, which sells me parts at cost and charges $45 and hour. I have already used them to do my MVI (safety sticker) and a couple of other minor things.

Now, on to the first run out....

I left the house on Saturday May 1 hauling a load of bulk potatoes to Lansing, MI, for Monday morning. Put 612 litres of fuel in my tanks and set off. In London Ontario I put in another 630 and thought WHOA this thing is drinking fuel! Thankfully it was just getting used to running again. After all, the truck sat on a lot for almost TWO YEARS. Got to Lansing on schedule and unloaded. Pay to me: $1821.60. Not too shabby eh?

First bump in the road: I have a reload scheduled in Shelby to go back to Boucherville Quebec, but it doesn't reload until Tuesday morning. NO problem, really, I had to wash out the trailer anyway so I could reload frozen.

Tuesday I am loaded and rolling for Boucherville. Second bump in the road:
Even though I can get there for Wednesday morning, they don't want it and won't take it until Thursday morning, so I hole up at the Flying J in Vaudreuil Quebec. Bonus: they have a bar . Along the way I refuel at the J in Napanee Ontario... 530 litres.

So I get in to the customer Thursday and unload without incident. Pay: $1405.80.

From there I head to St. Denis de something-or-other to reload dry freight to take to Oromocto New Brunswick to deliver at 5am today. No problem, off I go.

From there, it's time to call it a week, so I go to the company owned truck wash (which is at exit 191 on NB-2 for those interested, across the highway from the Irving) to wash out the trailer since they're going to reload it with bulk spuds again tomorrow, refuel 610 litres, then deadhead back to the yard just outside of Hartland. Oh, the load pay to Oromocto? $1659.

From there, I bobtail back to the house in Woodstock. 2 miles from my house I blow a coolant hose, the top rubber elbow between the radiator and the pipe. Thankfully this happened less than 1/4 mile away from a shop. The repair cost me $138.

All in all, not a bad start,eh?

 

I decided to go with the cheaper truck so that I can get it paid off fast while still making good money, then in a year or so if I decide to upgrade I can do it for cash. I like having good credit, but I HATE using credit.

I'm paying in the neighborhood of 83 cents a litre for fuel, depending on location. By my calculations I'm getting 5.8 miles per US gallon right now, but I expect that will get better.

 

Well, what a month this has been! Here it is now June 1st, and I just got my first settlement to cover May 1 to 15. Somebody somewhere forgot to tell me that lease op pay is two weeks behind. Oh, well...

So here's the final tally on what I did from the 1st to 15th:
Hartland, NB to Lansing, MI: 2061.07
Shelby, MI to Boucherville, QC: 1580.74
Saint-Denis sur Richelieu, QC to Oromocto, NB: 1232 plus 259 FSC
Hartland, NB to New Haven, CT: 912.56
Schenectady, NY to Woodbridge, ON: 674.52
Cambridge, ON to Moncton, NB: 1733.13 plus 314.92 FSC
Hartland, NB to Hartford, CT: 868.23

Trailer rental for the period: 963.61
Total revenue to the truck: 8672.56
Obviously fuel comes out of that, as does insurance, WC premium, work done at the company shop, etc. Net into my account this am: 3964.32

My truck payment is 249.88 (dunno how they came up with THAT number) twice a month for a year, or faster if I want.

Of my experience so far, I will say this: it's a LOT easier for me heading down the road knowing that I am lining my OWN pockets instead of someone else's. Of course, there are problems with any company, namely a total lack of communication inside the office. Just because you send a Qualcomm message, don't assume that everyone who's supposed to know something actually does.

Stay tuned!