This kind of stuff used to come in news letters and or business training classes.
80 percent of all new businesses do not make the first year. A large percentage of those that are left do not make 5 years. Most of the ones that survive that stay in business.
That is very out dated information but today you can google it. Percentage of new businesses that fail? etc. Maybe also check under SBA and Labor Bureau Statistics. I may have read that from National Association of small trucking companies.
What I normally see is you need to have one truck and drive it. Used to here then it took 5 or more. Now It maybe more like 10 or more unless you have some special contract.
Be very careful with that nest egg. It can break and be gone.
Trucking is a tough business.
Maybe I am being unrealistic.. you tell me
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Where do you live? North east?
250 mile radius and flatbed home every night do not mix. I have a few drivers that are “local” and their max radius is 200 miles. 150 preferred. These are van drivers too, I would venture to say that flatbed on avg has a higher load and unload time.
Why is your fuel bill so high? No way you’ll break say 2000 miles. I don’t see you spending more then $4000 in fuel on a program like that. Your driver will put in 60 to 65 hrs per week FYI so maybe bump up your pay allowance for that.
I’ll let you know right now that running a single truck local won’t work. How will you do a full turn in a day and still load your next days load? Not gonna happen. You might as well get a regional guy with a 700 mile radius who is paid by the mile with a weekly guarantee. This way you can run him the most profitable way and not have to worry about getting him miles.
What is your current job? I’m assuming it’s not a truck driver. Not saying you won’t be successful but your learning curve will be steep. It’ll take more of your time then you are assuming.
I have much more but that’s all for now.
I started with 250k and I honestly don't feel that would be enough to cover the first year entirely, looking at all the expenses dumped in the first 3 months and I'm like "Oh boy, I hope no one quits before July" or "If one guy quits I guess I'm driving the truck". Obviously that's just being pessimistic, but it's the reality that you could have one bad week and the driver will bounce onto the next company with a sign on a bonus and they won't have to do anything more than they're already doing.
This will not work.
Bad time to get into this, the time to attempt it with liquid capital (READ not using credit) would have been back in September.
The rates are declining, competitiveness within the industry is growing and capacity is too large.
You may end up with one or two direct customers but if they are medium size how do you handle overflow if they have it.
You can’t have a job and not expect to be involved with daily operations, logging and back office work alone is time consuming, then you have the drivers jacket and maintaining that.
Your idea is valid except for the rates and assumption of sustaining it.
You shoot for profits in this business out of the gate, it isn’t like a fast food place where you do break even for the first year to pay the franchise costs and then hope for sustainablity.
Your numbers are way off by the way, fica and Medicare are about $785 for each driver which is both parts of it, the same goes for the truck costs.
Fuel is off, so is ifta, which comes out of your fueling location and adjusted. If you are running intrastate you won’t need ifta costs - it is a sum zero gain thing.
Too many unanswered questions.
Failure rate as mentioned in general is 80%, in this industry it runs 7% to 11% higher.
I’d only redirect one part of this- you can do flatbed home every night within 250 miles, IF you have preloaded trailers for the next day and budget for and plan on deadheading back to the yard every day.
Otherwise, you’re correct that the radius needs to be quite a bit tighter.
The overall plan laid out here is full of holes- if you pay a guy hourly to do a job that you’re not there to supervise, while you keep a day job, how long before there’s a common issue (flat tire, shipper hang up, consignee hangup, minor issue breakdown, driver personality issue) and the owner can’t get away from his day job to rectify that situation?
Have you ever ran your own authority with the same equipment in the same radius successfully? Having to do it while paying someone else for the daily work tasks makes it harder if you aren’t heavily involved and or have lots of experience with the locale you’re running/knowing which vendors to use in a given area to quickly solve your mechanical problems, etc
Sounds to me like you’re looking for a somewhat passive income stream with retirement coming.
You want to retire in 5 years: if you lost $100k in the next 18 months, how much longer would you be working towards retirement? With your plan it seems like a pretty likely scenario to me.
I greatly appreciate all of your feed back.. This plan of mine is in no way perfect, which is why i reached out.. A lot of good info is coming from it, and also some great points were made that i have not even considered. I have never done over the road before, i have and probably will always be a local driver.. which may be why my plan is flawed. I do not know the ins and outs of the freight industry. I do not want to leave my job at this moment,so finding the right driver is key. it is my personal opinion that said driver would be the face of my company(if it ever gets going),so driving habits, personality traits, work ethics, family life, all come into play and i have put a lot of thought on how to take care of driver based on what i thought to be important to me as a driver, and that is decent pay, health benefits, home time and retirement plan. i personally never liked working on a percentage basis for anyone but myself.. when i owned my truck way back when(in another state) i ran local, and maintained it myself , very rare did i take it to a shop..I always felt that company drivers who make percentages were reckless, hotshots, who ran like animals, and do stupid unnecessary ####. not what i am looking for to represent me...
The 250 mile radius i came up with is a little bit far for local work, but i thought it would be feasible to get driver home at night. ideally he would be preloaded, leave in am, and get back and pre load again.. but this also may be why some of the distributors i have talked to basically laughed at me when told them what i thought i needed to make a run for 250 miles.. so now i understand that a guy comes in and charges half, because he is staying out, and getting back hauls.. maybe i need to reduce the radius, but the per mile number will only go up unless ii find out where shipment s going, and then scour that area for a back haul..
so many different ways to go..
I know my numbers may be off here or there, but i think that i am almost spot on in the total monthly expense.. have read, and re read the post that is pinned, and i seem to be in the ball park or so i thought.
As for the truck and trailer payment... well i could go 5-7 yrs old on tractor, but i do not think it is a good idea, you know what they say "your either paying the payment or the parts house". i was looking at 2018 models with 42"coffin sleepers( as a just in case i get stuck out kind of thing).
the trailer i was going to buy brand new, but i can get an older one and refurbish it if needed, i see them dirt cheap all over the place around my area, and that would probably eliminate the trlr payment.. biggest expense on those would be tires and lumber, maybe brakes.
I do appreciate the feedback, and i will start making adjustments on my numbers, and see what i come up with, and run different scenarios on pay packages and such.. It really would be awesome if i can get this off the ground and running, but if not then no harm no foul......42'sLast edited: Mar 4, 2019
I think the real problem is having a driver rather than you running the truck yourself.
Not only does it make it infinitely more difficult to make money, drivers are very hard to find. You could go months easily without a driver and you could have a driver for a day or week and you could be looking for someone again right away... as the bills keep piling up and draining your bank account.
If a driver knows that you're not right there taking care of things, or that you don't know the area that he's running inside out there are many many ways a driver can take advantage of you, if you can even find one. Basing your whole business on having an A1 driver that's going to do the right thing for you is really not a good idea.
This is not a good business for passive income. It is very possible that you could lose everything you have within a shorter periodf time than you would think.
You would really do a lot better just taking your money and investing in real estate or learning how to day trade or something like that, and you could keep your day job and make investment money on the side without the headaches, problems, and risk Iof going broke.
If I was in your situation that's what I would do.
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