New O/Os

2 to 3 months of operating expenses is whats been recommended. I would say enough to do a engine rebuild which now a days sets you back 20 to 30 k .

 

I'd say more than that. My reasoning is this. I started with great credit and $40k liquid. At times I had to float it all getting established with brokers (waiting on 30+ days to get paid) while trying to buy equipment which was used and needed a lot of work on top of the purchase price, not to mention feeding my family.

Since everything else in our business is double now I'd say double what I had ($40k) which I think was probably minimum. I'd say $100k, honestly. Who has that much money fluid? Almost no one.

 

It’s definitely crazy times. I could sell all my equipment and retire but at the same time who wants to quit making the kinda money you can make right now? If you do sell and retire then how much does taxes and inflation eat up? I’ve decided to push on but everyone is different.

 

You won't retire for a long time, bro. Me neither. I don't think many of us who are anywhere near over it would spend our free time hanging out on forums.

I'm always thinking of doing something else, but here I am, it's what I know, or maybe what I think I know. Lol.

 

I heard that! Any of us that are so ate up with this industry that we spend our free time thinking and talking about trucking, wouldn’t be away for long!

 

Here's what I'd say... but I'm pretty anal about $$$. And you're talking NEW??

90 days - Fuel - $15k
90 days - Insurance (incl. health) - $4500
90 days - Truck and Trailer payments - $15k
Maintenance fund - Engine rebuild + yearly escrow - $50,000 (I get you're buying new, but...)

Just think hard about the whole New thing. Many of us starting buying ruff n tuff trucks that had good bones, and got us that first $50-100k with minimal costs. You buy new you'll be 100% busting rump for 4-5 yrs just to make the payments, and by then your new truck will blow up and you'll need another $100k after trade-in to get a replacement.

 

For a authority O/O with new equipment I suggest around 100K after equipment is settled. Why struggle? Just start your business with plenty of money. It’s so stress free when you can just write a check for necessary items and not worry about maintenance costs and such. Trucking involves a driver and a truck/trailer. Have the most highest performing, service orientated driver and the best equipment money can buy. Anything else is half stepping. Be the alpha, provide the best service a broker/shipper can get. - Yes, every haul I do, after I have settled on my fees, I serve the broker as if they where the most important customer on the planet. Next time when I am grinding for more money, they know at least they won’t have to babysit a carrier when spending the extra.

 

This is gonna start a forrest fire & I apologize if it does and Iam not singling any 1 person out I've seen a few guys on here saying they are going to buy new trucks.. the other day I read a post @Aritic Fox made breaking down just what is takes to order a new truck
But who in their right mind would put a down payment of 50k down then possibly have to wait 2 years before they even get the truck ??? That's just crazy stupid

Alot of things can change in a 2 year time period
Rates can & probably will take a nose dive
God only knows what the interest rate could be or the economy in general
Guess what if we head into a economic down turn and manufacturing slows up guess what slows up too freight
Slow freight means cheap rates
But to each his own..
I grew up in the Agricultural industry during the late 70's and early 80's I watched alot of financialy solid hard working people loose everything their fathers and grandfather's worked their entire lives to build in a matter of 2 years
JMO but we are headed right back down that same road just remember everything goes in cycles and we've been riding the gravy train for a while
The stockmarket is already showing signs for a major down turn.. and I honestly don't belivethings are going to compensate for the inflation rate we are climbing at
There is a boatload of truth in @Rideandrepair's post

 

Right! And I've seen posts of people ordering trucks and the dealer saying "sorry we added another $15k because the MFG added it"... what happens when you order it for $250k and it drops to $200k 2 years later when you finally get it? I doubt they refund you that $50k...

 

Very good point you bring up