Leased to a company vs. Own Authority?

I'll make this brief ... I won't get an authority because I don't want to hassle with collecting what's owed to me. It is easier for me to run the trucks under a couple leases then to deal with the cost of collecting and the paperwork even if I lost some revenue - but more importantly I got paid no matter if the company got paid or not.

As for LS, good company if you know how to play the game. I used to have my do not haul list and if an agent didn't do what they said they would do or if the revenue was off. I had twenty agents I would not even answer the phone for, they screwed me so I wouldn't haul for them even at 10 a mile. And I always got paid.

 

How do you figure you gross $50,000 more than a driver leased to Landstar? Are you hauling direct freight? The 100% vs 73% is smoke and mirrors if you're hauling any broker freight. You could just as easily be grossing $50,000 less than a Landstar BCO. I just don't understand why this is so hard to drive this through the one truck carriers heads.
As far as learning curves go, there really isn't much that's different at LS vs authority, structurally, besides doing your own filings. A lot of folks here have their own IRP account already. You see every charge back for NYHUT, KYU, etc. The only transition would be having to negotiate rates. There's actually a frustrating disadvantage in that there will be times when you know what the lanes pay from Landstar, but due to capacity, the brokers are keeping 50% and you can't get them to budge. The single truck carrier whose never seen what the customer is actually charged is oblivious to this. If I thought I could make MORE money with my authority, I could send the Feds the $75 and reactivate in about three days. My insurance lady would love to take my money again. I am all about net income, I want to work the least, and make the most. Landstar does that for me currently.

 

I get that, and I'm sure DY does too. I'm gonna take a guess he's comparing profit to the usual mega lease at a dollar plus or minus a mile + FSC.

 

One advantage to leasing multiple trucks to another carrier is that they will help you find drivers. When you have drivers and more than a single truck that you drive yourself, your responsibilities and challenges greatly increase. I know a few fleet owners who continue to lease to a carrier rather than run their own authority. Leasing to another carrier can also reduce the amount of capital you will need for base plates, insurance, etc., You also don't have to worry about the paperwork.

I think it is the paperwork that concerns some who are considering getting their own authority. As long as you stay on top of your paperwork, it isn't that difficult or time consuming. Whether you lease to a carrier or run your own numbers, you are paying either way. With the software I have been using for the last several years, it is much easier to keep my paperwork up to date. The two most time consuming issues that I have had to deal with are payroll and IFTA. The software keeps up the IFTA so all I need to do is print off a report at the end of the quarter and submit the numbers through my state website. If I pay on a 1099 or have owner operators, I can also do payroll on the new version. Otherwise, I can continue to use my spreadsheet.

I have been able to minimize the time I spend for paperwork over the years. I think it is easier to keep up paperwork today than in years past. When I first started, I had to do everything by hand. We didn't have access to computers or many of the other technology we have today. With some it is the risk. Getting out of bed involves risk. I have never really considered having my own authority as taking a risk. While it is true you do have greater responsibility running your authority, it is more about your attitude concerning those risks. I could make a good living leasing to another carrier. I think I can earn more on my own. At least the opportunity to earn more under my authority.

If you go from never driving a truck to your own authority, the learning curve is very costly. It is much better to take it one step at a time and learn as you go. If you start as a company driver and stay in that position for at least a couple of years, you will be in a much better position to know whether you want to lease on or get your authority.

 

Perhaps -- I've never been leased to LS, so I can't say for certain, but I believe that when I set up a load alert on Landstar's website and a load comes along meeting my criteria, I see the same rate you do. I say that because I'll often see that same alerted load posted for a much lower rate a few minutes later on DAT or ITS.

If I call on it, the first thing the broker asks is if I'm a bco or approved carrier. "Approved carrier" I say, and she'll give me the ITS/DAT quote. I'll counter with the exact amount in the load alert and 9 times in 10 -- she'll immediately acquiesce.

But, like you said, there are occasions where there is excess capacity and they won't honor the alerted rate for approved carriers. On the other hand, there are times when there is insufficient capacity and I can negotiate more than the alerted rate.

 

Heres an experiment for you-tell them you're a BCO and see what kinda number they give you. I had a landstar broker slip and give me the total gross, didn't realize it even after I mentioned something about not needing a breakout for fuel/accessorials. Load alert said $1300 on 210: he told me $1950 gross.

Dealing regularly with shippers receivers and brokers, I recognize that personalities are the real determining factor on pricing for spot market rates.

customer number 1 (receiver) wants the cheapest price even if he will lose the sale trying to keep the price down.
customer number 2 (shipper) wants gauranteed service, pays a premium and will throw more money on top of whatever rate I quote half the time.
customer number 3 (broker) wants the load covered, knows the service I provide and what I charge. If he's calling/emailing it means his regular cheap truckers can't cover it. I make good money and I know he isn't losing he's just making less than he would have otherwise.

I make money with all the above and a bunch more personalities. I see people leased to carriers making money and losing money, I see independents making money and losing it.

No one plan makes everyone money, leased or independent. Hard comparison to say person a makes more than person b being that they have completely different plans.

 

How much do guys gross per year being leased? Not running super hard, but putting in a solid year with one unit?

 

Very well put. Landstar has some agents that need to be canned, but they have some that are top shelf. I'll stay with Landstar and put up with some of their agents rather than go back under my own signs and put up with outside brokers.

 

On the load alerts you are getting as an approved carrier that is at 78-80%. Landstar makes 47% of their revenue off approved carriers, obviously they aren't giving it to you at what they're charging the customer.