So you want to "own " your own company

There are some good trucks that you can buy for $20,000 or less that will give you years of good service. Even if you buy a truck for $40,000-50,000 you may still have a major component failure that may not be covered under your warranty. As long as you check out a truck thoroughly before buying, there is no reason to expect less service than you would from something that costs twice as much. Even new trucks can have problems. If you don't want to pay cash for a $20,000 truck, then find one that you can pay $10,000 down and finance the rest. Buying a truck is always a risk. If you find a truck that you like, have an oil analysis and dyno performed and you should find most anything that is wrong with the engine. A good mechanic can go over it and check anything else out for a minimum charge. There is no way to take all of the risk out of buying a truck. You can minimize the risks, but when you deal with anything mechanical, they are all subject to failure. I have purchased several trucks for under $20,000. I only recall having a problem with one of them. If you want to spend more than $20,000, you can find good trucks in the $25,000-35,000 range, but it is not necessary to spend that much.

I do understand your concerns about going into California with an older truck. I also know what you are talking about when you mention the age of a truck when it comes to leasing to a carrier. The better paying carriers don't care about the age of the truck as long as it will pass a dot inspection and looks decent. It is the cheaper rate carriers who are concerned about the age of your equipment. It isn't the age or even the miles, but how the truck was maintained.

If you prefer to finance your purchase and don't have the banking contacts, you can do a search on the internet and find lenders for different types of credit and experience. Most dealers have sources that they can put you with to finance a purchase as long as you have good credit and a good down payment. I would expect then to require from 10-30% down.

 

I have a question about leasing. You might know that the logic of buying or renting depends on how long you plan on staying in one place. Real estate agents will tell you to plan on staying in one place for 3-4 years minimum if you want to buy a house. Less than that and you won't "break even" on all the costs you pay to get into a house.

So is there such logic when looking at leasing or purchase? I don't need the "how much do you want to spend?" questions answered because this isn't about recouping my investment--I can make that decision. What I need help in is whether to lease/purchase or not. Should I plan on staying in trucking for 3-4 years at least and if I don't, then I should just stay company?

What do you think?

 

Let just tell you what I have done and you can decide from another point of view. I bought a 1990 cabover for $4000 it had a 350 cummins with a 9 speed. I live in Florida and drove that truck to Amarillo, Tx every week. Now I only had $10,000 to work with when I got started, so my truck had to be old. I got it off Craigslist from a lady close to my house. I know how to turn a wrench so that helped out in knowing what to look for. But I had very few problems out of that truck, and the only thing that was hard to deal with was the fuel mileage. I still made money! The truck had 800,000 on it when I bought it, and I sold it for $6000 after I ran it up to 950,000. If you look hard like I did you will find good trucks for cheap with low miles. Plus there are a lot of guys that are getting out of the business that are selling trucks cheap to pay the loan off. A good piece of advice that I got, and will give is that when you first start you dont want to owe any money on that truck until you know what kind of money you are going to make, and if you fail it won't coat you anything for that truck to sit, or until you decide to sell it. With fuel the way it is, and the uncertainty in the economy you would be making a mistake to get under a huge payment. Besides, if you do a little research you will find companies that will give you aftermarket warranties to help cover tows and repairs at half the cost. I have learned alot, but still have a lot to learn. You have to do what's best for tou, but keeping your out going cost to fuel and insurance is a good way to start to succeed. I have since bought another truck, and this one, thought lower mileage has cost me more to repair than it cost me to buy the last one. And since I own this one too its just a matter of paying myself back not the bank. Just keep that in mind. Hope this helps...

 

I bought a 98 Kw900 with a backyard rebuild on it. Had it dyno tested, and oil sample. Im a strong mechanic, so I knew what to look for. Paid about $20K after putting 4-5 into it for repairs that I wanted. Its got a big Cat so the mileage is the usual 4-5 MPG, but I can pull a flat bed with steel loaded all day long with out worken the engine hard. And my rig looks a lot better than most sitten in the lot at TA. As far as a lease goes... be very, very carefull. A bunch of guys lost their rigs when that company went under 4 years ago. Some almost had them paid off, and come to find out that the lease payments were being pocketed by the trking company and never paid to the lease company.. So if you go that route.. make sure you have direct contact with the leasing company.. But I have heard a lot of stories about guys half way through a lease,,,, and quit, or the company dies, and they lost all of their investment. If you gona lease, do it for no more than a year, till you figure out if being an O/O is what you want. Then go buy a truck. As stated,,, if you look,,, (it took me 9 mo to find my rig), you can find a good deal. My guy was going back to being a mech, and wanted money for a down payment on a new house. I made him a laughing offer and to my surprise he took it.

 

buzz, good advice. thats what I did. tested the waters, sure glad i did. was a l/o before just jumping in buying out right, but its always good to be cautious of who your runnin for as a l/o...

 

I want to clarify something.

My interest in leasing does not extend to owning. I have a good business head sitting on these shoulders and know that I can make more money as a L/O than as a company driver. With O/O, I get all the benefits of owning a business but I have an asset to deal with at the other end. I don't care if I own it. It's like leasing versus owning a car. I tend to drive the vehicles I own until they die or I get the urge to "adopt" a monthly payment, which doesn't happen often. For me, trading the old one in for a newer one at the end of a lease works fine. I don't need to own it.

I'm also smart enough to know that I will wait for a year or so before I talk seriously about a truck lease. "Knowing" that I have a good head for business is not the same as having had four seasons of experience, including the busy freight times and the slow times, the good weather and the nasty weather. All of that contributes to the bottom line and I want the experience of having lived it.

 

If you have made up your mind about leasing a truck, then find an equipment leasing company and lease through them rather than a carrier. You should be able to get a much better rate and can move to a different carrier if you wish, without fear olf losing your truck.

 

I just started my own company and need some help with some things i dont have a truck and i dont know if i should lease one and get a driver is there somethingi should know and consider if anyone can help plz contact me.

 

OK, guess I will be the first in a long line of many.

You started a company but don't have a business plan? Because if you had a plan you would have figured all that out BEFORE starting the company.

Also interested when you say "started a company" what you mean by that.

 

I'll chime in too...
Lease a truck and get a driver? You need to crawl before you can walk. More details are needed. Are you getting your own Authority? I suggest you get a truck and drive it yourself until you understand what's all involved. But first, you need a business plan and some $$ in the bank. How are you set for that?