New truck

Discussion in 'Questions From New Drivers' started by natanishe, Jan 17, 2015.

  1. natanishe

    natanishe Light Load Member

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    Jan 17, 2015
    Los Angeles
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    Hello Everyone,

    I want to purchase a truck as an investment, and sublease it to the company that will be charging me 10% of the gross for running it. The will find a driver for me.
    Eventually I would want to start working with them as a dispatcher to learn the industry and build my own company.

    Is that a good investment, is it worth doing?
     
    Chinatown Thanks this.
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  3. WitchingHour

    WitchingHour Road Train Member

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    Broomfield, CO
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    Do you possess any actual experience in the trucking industry, or are you looking at doing this just on a whim?
    How much do you intend to pay your driver? How much of what you get paid do you intend to put into escrow for maintenance? What have you done to calculate operating expenses? What is the minimum rate per mile you'll commit to? What are your freight lanes going to be? Can you only accept loads from their load board, or are others open to you? How much do you intend to spend on a truck? Buying new or used? What kind of truck have you decided on, and what kind of specs will it have? Do you know the first thing about turning a wrench on a truck, or do you intend to pay a shop rate for everything?

    Not to be judgmental, but it is what it is... I'm kinda getting the impression you haven't really thought this through.
     
  4. Chinatown

    Chinatown Road Train Member

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    Henderson, NV & Orient
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    In addition to WitchingHour post, study the OOIDA website for the business end of owning a truck.
     
  5. natanishe

    natanishe Light Load Member

    109
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    Jan 17, 2015
    Los Angeles
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    I am paying my driver .40 to .45 per mile depending on the experience. I was thinking of putting 15% of my income into escrow for maintenance. My route are going to be LA to Dallas, Atlanta, Chicago. I am looking at purchasing one of the Gordon used trucks, for $64900 Freighline Cascade 2011 it's 10 speed manual with Cummins engine.

    As far as operating expenses I am looking to spend $1200 on truck payment + $600 on dry van payment , 1200 on insurance, $2400 on registration the truck will run under MC and DOT of the company that I am leasing my truck to.

    Am I missing a lot of knowledge, are there more expenses that I haven't though of?

    Thank you!
     
  6. djtrype

    djtrype Heavy Load Member

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    New Orleans
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    Fuel being a big one. Driver layover pay for breakdowns, slowdowns, etc. Will you provide insurance, 401(k), vacation pay?
     
  7. natanishe

    natanishe Light Load Member

    109
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    Jan 17, 2015
    Los Angeles
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    Right, of course I forgot to mention fuel I'll be paying for it as well. As far as breakdown and layover pay, I was hoping 10-15 maintenance escrow account would cover it. to I am planning to hire the driver on 1099, where I won't have to pay for any of that.
     
  8. GenericUserName

    GenericUserName Road Train Member

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    Santa Monica, CA
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    Please stay away from this industry.
     
  9. G.Anthony

    G.Anthony Road Train Member

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    Paying a driver on a 1099 you had better be MORE generous than .45¢ per mile, as he will have to take out and pay his own taxes. As it stands, to me, you would be paying minimum wage after he takes out for taxes, and maybe even per diem. Oh you WILL get a driver, or 2 or 3, maybe even 4, but where will they leave the truck when they walk away? Will you get a dependable experienced driver. or a bunch of newbies and have to deal with the plethora of accidents they get into?

    You "may have" a plan, but if you are not personally going to establish the routes and get to now the customers, and your newbies mes up, how long exactly do you think you're gonna be in business?

    Sorry, but you really have "no plan" for success, only for failure, is the way this driver see's it, oh yeah, years ago, I DID run a business, a successful business at that, before I retired and got into trucking. I actually WORKED at it to, not sat back and thought I was going to rake in the money. The old saying, "when the cat's away the mice will play" is true of ANY business, and I think you wanna play while you think the money is gonna come in freely.
     
    "semi" retired Thanks this.
  10. Happily Retired

    Happily Retired Road Train Member

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    high plains colorado
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    I agree with GenericUserName, there was a time when starting a trucking company was a good deal to go into, and some still do ok, but they've been at it for years and have good dedicated accounts. Now mega carriers are cutting the rates so bad, just to keep their trucks rolling, they are forcing the small guy out, and I think someday, all small operators, like small dairy farms, will be obsolete. I think there's better places to start a business today. Also, drivers, or workers in general, are getting tired of being paid on 1099's. I know I would never do that again.
     
    Numb Thanks this.
  11. G.Anthony

    G.Anthony Road Train Member

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    [QUOTE="semi" retired;4416479]I agree with GenericUserName, there was a time when starting a trucking company was a good deal to go into, and some still do ok, but they've been at it for years and have good dedicated accounts. Now mega carriers are cutting the rates so bad, just to keep their trucks rolling, they are forcing the small guy out, and I think someday, all small operators, like small dairy farms, will be obsolete. I think there's better places to start a business today. Also, drivers, or workers in general, are getting tired of being paid on 1099's. I know I would never do that again.[/QUOTE]

    Eventually, bigger carriers WILL INDEED take over the smaller companies, then THEY TOO will be bought out by the bigger sharks, it's a very vicious cycle, of eliminating the competition to drive up costs.

    An "investment" in buying a truck? Hardly, it IS a losing "investment" as the truck, and trailer depreciate as soon as it is driven off the lot. A home, T-Bills, Bonds, 401K or Roth, even an ordinary savings accounts ARE investments that "APPRECIATE" in time which earns one capitol. A truck, trailer EATS away money over time, necessitating in spending MORE money to replace.

    The successful o/o's that are out there today, are so due to being IN the business for a long time, KNOWING the C.O.D.B. and take virtually NO RISK. Those are the ones that will continue to survive, over the "sit back and let someone else work for me types".
     
    "semi" retired Thanks this.
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