lease-on deal I was looking at

Discussion in 'Expediter and Hot Shot Trucking Forum' started by Brandonpdx, Aug 24, 2022.

  1. Brandonpdx

    Brandonpdx Road Train Member

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    Saw an ad on the local Craigslist a few days ago looking for a couple of owner/operators with 1-tons to haul non-CDL hotshot on 30 footers. Guy I talked to today about it was asking for $200/wk for insurance on top of the $70 for the trailer rental. Then he takes 20% of the linehaul and I'd have to buy all my own flatbedding supplies (tarps, ratchet straps, etc). He said 1999 truck with non-ELD keep truckin' or even paper would be fine.

    Sounds steep to me but, thoughts? Small outfit...6 or 7 trucks maybe. Says most of his guys go out for the week and come home for the weekend. Sounds like there's nothing down required for the trailer and can walk away any time if it isn't for me. He has Comdata cards and a full time dispatcher. I played with some numbers assuming a few...assumptions. $2/mi average, 11 mpg at $5/gal, his $270/wk. Say you grossed $4,000 for the week on 2,000 miles. Call the fuel 25% so that's $1000...maybe a little pessimistic but lets stick with round numbers for simplicity. His 20% of the linehaul would be $800 plus $270 for the insurance and trailer rental. Let's just say you'd be left with $2,000 after expenses. By comparison with own authority you'd easily be paying around that same amount per week for the insurance (maybe a bit worse) but would be getting 100% of the linehaul, so...how's my math on this?

    I also called Horizon Transport in Wakarusa, IN. They were leasing new 53' Shipshe trailers for $600/mo but wanted a refundable $2k deposit, required ELD use and also said a 2000 F-350 was fine but a 1999 wasn't (lol, it's the same truck), so had to cross them off the list. They also wanted a 6 month commitment so not exactly a walk-away deal. They also sell used ones outright but do not offer financing and I am really not in a position to do that right now. Much more expensive trailers than hotshot flatbed too.
     
    Last edited: Aug 24, 2022
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  3. buddyd157

    buddyd157 Road Train Member

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    a lease deal, is a lease deal, is a lease deal, meaning the company makes out first.

    don't matter the rig, 18 wheeler or hot shot, it's a lease deal

    you're going on "assumptions", not actual facts.

    one fact, do they sit before the next load?? and how long is that gonna cost you.??

    can't you do it on your own..??

    then you'll know the real numbers, not assumptions?
     
  4. Brandonpdx

    Brandonpdx Road Train Member

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    Lets labor under the assumptions that I don't have huge bucks in the bank to buy a new trailer or even a nice used one, and don't want to sign up for payments to finance one and don't really have the experience or stability right now to feel like it's a good idea to try get my own numbers. Looking to get my feet wet pulling a wagon of some sort rather than going back to the power-only RV hauling. Been there done that.
     
  5. Lite bug

    Lite bug Road Train Member

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    I got my feet wet with the same type set up. buddyd157 is spot on about the lease. I knew nothing when I leased on, a good learning experience. In about 6 months I knew long term it was not a good deal. They went out of business pretty fast. My observation of your posting over the years tells me you would do just fine running under your own numbers. However this is a uncertain market right now. I was very lucky as being financially stable when I started, I had my truck and just went and signed a lease for a trailer, I should have just bought it or financed it. I was taking the advice of the guy I was leased on kinda dumb.
     
  6. JoeTruck

    JoeTruck Heavy Load Member

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    As long as you can walk away from this it might be a good place to learn the industry.
    Doubt you will get 11mpg unless you are hauling feathers.
    Don't forget maintenance and breakdowns.
     
  7. bad-luck

    bad-luck Road Train Member

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    In my opinion, 20% is high, 10 to 15% is the norm. $200 a week for insurance is a bit high as well. I would keep looking to find something better.
     
  8. Brandonpdx

    Brandonpdx Road Train Member

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    I've got no problem buying one at some point in the near future but I'd want to be a little more certain I even like that type of work before I go there. I kind of always pictured myself hauling RV's and/or cars on a Shipshe or Take 3 since that sort of work just naturally appealed for whatever reason, but I'm willing to keep an open mind here if there is an opportunity to try flatbed using his wagon. The supplies I can hang onto or sell if I hate it...relatively small investment. I appreciate the encouragement though.
     
    Last edited: Aug 25, 2022
  9. Brandonpdx

    Brandonpdx Road Train Member

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    That's kind of where I'm at. As long as it's a completely flexible walk-away deal and there is no huge deposit on the trailer like Horizon wanted. I will be discussing that stuff further with him, probably at a face to face meeting. Wear and tear items on the trailer I'm not sure. Probably I will figure it out pretty fast if I like it or hate it and either give his trailer back and walk away or go buy my own so nobody is arguing about who pays for fixing this or that.

    MPG was a guess. I used to get somewhere in the 10-12 range pulling RV's which are pretty bad with the high profile and frontal area dragging through the wind. I have considered doing a ring and pinon swap to 4.10 or 4.30. The 3.73 ratio is the one bad spec on the truck. Fuel might not be $5 average either now. Maybe call it 10 MPG and $4.50 fuel. It's going to be somewhere in that ballpark.
     
    Last edited: Aug 25, 2022
  10. Brandonpdx

    Brandonpdx Road Train Member

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    That was my first impression, but of course the devil is always in the details. If the company only takes 10% but they expect you to find your own loads, that might be great for somebody more experienced. If there's a full time dispatcher that handles the customers or brokers and finds good loads to haul, I guess those services will demand a higher cut. For the uninitiated, having that help might be worth it.
     
  11. bad-luck

    bad-luck Road Train Member

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    There are companies that only take the percentages that I mentioned, and find loads for you. Like I mentioned, just keep looking. Obviously if you can't find anything, then you can try them.
     
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