Number one cause

Well, my experience in over 30 plus years of sole proprietorship of one kind or another has been that when expenditures out pace income, you're screwed unless you have the capital to withstand the hit.

Believe me, it's not IF the storm is going to hit, it's just a matter of WHEN is it going to hit.

 

If you really want to know what someone like I see, it is two things.

Under-capitalization and money mismanagement.

Other reasons are lack of education within the industry, not understanding the regulations/laws and thinking that they can cash in.

AND my question - why do you want to know?

 

I'm a new O/O but I'm 45. I agree with all of the above. Most people just read and believe what they want to hear so they won't read all of these answers and let them sink in. The only two things I can add are patience and maturity. These come at different ages for everyone. Some might be ready at 25 but I would not have wanted this or been ready until about now and yes, I'm loving it because I'm ready now. I drove a company truck for about 10 years, a friend's truck for a few months and ran an expedite van for about a year (as a leased O/O). I'm just now starting to feel ready. You know what? Making what I'm making really makes me want a new Jeep but here's what they younger me didn't know. 1. There's no rush, I won't be there to enjoy it anyway. 2. No way before equipment is paid off. 3. Yep, I've got the cash right now but it's an emergency fund........I could keep going.

 

I'll give you a real time (current) example of the storms that hit in business & life. I have a friend who is an O/O. He has a 2016 KW T660 with a Paccar motor, which he bought new. Currently has 350k +/- miles.

The engine derated over a week ago. KW Dealership Service Dept (where he bought the truck) told him the DPF needed to be cleaned, however, they were about 10 days out from being able to do anything because they were booked solid.

So, they reset the code for him which gave him the ability to drive to the next KW Dealership about 80 miles away, they were only booked 5 days ahead. Dropped off the truck and here it is 8 days later and they finally got around to cleaning the filter. However, when they reset the codes and did a forced regen, it wouldn't take.

Turns out, after further inspection and diagnostics, the DOC was warped and severely damaged on the inside!

He's looking at what could be an 8k dollar bill when it's said and done. However, that doesn't count the 13k in lost revenue he will most likely incur. Now, none of this was under the normal operating mileage warranty. So, in effect, he is out of pocket 21k dollars, not to mention the lack of cash-flow from the revenue stream loss.

I don't think he has 21k to 25k sitting in the bank...

But wait! That's NOT all! His common-law wife has had kidney failure for some time and has been deteriorating in health. Well, they received a call Friday night informing them that someone had been killed in a car wreck and was a donor, the kidney was a match and they had to rush a couple of hundred miles away to the hospital where the transplant would be done. She had the surgery this morning and it appears it was successful. Which is a blessing!

However, combine these things (business & personal financial) together and that's what I mean about it's not a matter of IF the STORM is going to hit, but WHEN it's going to hit!

 

They are truck drivers not business people.

 

The few O/O's I know who packed it in after many years was the new trucks just kept breaking down and towing was not covered. These "ECU glitches" can break the bank.
Myself Monday night truck stopped dead 50 miles from town, not my truck, not my problem but tow trucks have increased their fleets significantly in my area.

 

They have no real understanding of the trucking business and that it is work.

No understanding about their truck and how to matain it, light comes on they go to a dealer, spend a few days and 5k then the same code comes on the next day.

Time management is a problem, with no one pushing it is easy to get too pickey about loads, only want to go to one area, too heavy, and before you know it you have pissed away a week.

They don’t build relationships with brokers and only haul freight that has been posted, this is a people business . Trust with brokers, agents and dispatchers can pay off big time.

They all expect to start at the top and aren’t willing to work their way to the top.

They do their planning and cpm based on 3 to 3.5k miles per week then they dive in and reality hits.

I think the reason most new drivers just out of school fail is they find out they have to work every day. The wake up in a truck a 1000 miles from home and realize that they can’t lay out from work today.

 

Inability to manage money and thinking you have plenty and can turn loads down.

 

No has has even mentioned the oops factor. The driver who "rips your hood off" in the truck stop parking lot... The 4 wheeler that cut you off and caused an accident... The burst steer that ran you off the road (yours or someone else's) What if you buy that truck and a month in someone else's fault causes it to be totaled. Insurance doesn't always pay 100% of those expenses, plus down time, due to someone else.

 

Good points. And once again an advantage to those who run older equipment that is paid for. Lot easier to sit a few weeks out when there’s not a $1500 a month truck payment staring ya in the face.