Tell me why the lease option is so bad

It was going thru mine too. So I had to put it up there. Kinda fits the whole company/lease relationship.

 

Effectively you are going to be going into business.....the number of failed business's far exceeds the number of successful business's. If you have never been in business before, don't do it!!! Go to business school, take some night classes...whatever....do lots (and again...LOTS) of research. If the numbers don't add up, then they don't add up, no point pretending anything else.

Oh and another thing....never believe anyone trying to sell something to you. Get independant advice. An accountant would be a start and if you can't afford an accountant, then you should definitely NOT be going into any sort of business. Just my thoughts

 

at my company you can have a shiny, bare bones Cascadia for $625 a week. That would be 2800 a month (4.5 weeks in a month)

You have to pay for plates, insurance, escrow, more escrow, occupational accident insurance (kind of like workman's comp), and whatever else they want you to pay for.

All that for I think 94 or 96 cents a mile plus surcharge.

Your break even point is at OVER 2000 miles a week. You do the math. Of course they tell you that you will run over 3000 in a week, but lets be honest. Things are crappy right now, and I don't run that, and I have been here a while and now how things work.

I can only speak for my company, but I am sure it is the same where ever you go.

 

It is definitely my goal to become o/o at some point, however i have no experience of the trucking business in the US and right now is bad economic times for everyone. I have run a business before but would never consider getting tied into a lease without a good grasp of the industry and good contacts in the company i am going to work for. I pulled for an o/o at home and saw the hardship he would sometimes have, and he had a second income also.

My plan is to drive company for 2 years MINIMUM, whilst learning as much as i can about the industry here, talking to o/os on the road, comparing their overheads and emergency costs against their profit. When i feel like i understand fully the nature of the undertaking, then i will consider leasing a truck of my own, if that takes longer than 2 years then it takes longer.

 

I pay $485/mo for my pickup, I pay ~$100/mo for insurance, and $350/mo in rent, plus all my gas, food, internet etc. When I leave in October to go OTR my mom needs something to drive, so she will drive my Silverado and pay my insurance on it...I will no longer owe rent since I will be home only a few days a month. That $485/mo is all I will pay, the rest is going to go to a truck fund so that I can buy a truck of my own in a few years.

 

This is true. I know quite a few lease operators that are very successful. Most are husband/wife or boyfriend/girlfriend teams with combined income. They easily manage everything off around 4000 miles a week, which is easy running.

 

Perhaps think about it this way. If the lease option was offered in other industries, it would be universally laughed at.

For example: Say you were just hired out of high school to be a general laborer for a construction outfit. You are qualified (at least on paper) to operate hand shovels, both round and square point.

Now their human resources guy says to you, if you want, we can lease you some equipment, which you will be responsible for maintaining, insuring, registering, etc. and hire you as a subcontractor. He closes the deal with, don't worry, we have plenty of work! You too can own your own business! No need for experience or industry knowledge.

Think about it.

 

You have the right attitude. I know it sounds old fashioned, but if you want something bad enough, you should be willing to work hard and save up for it. Easy credit has caused enough problems with individuals and our nation as a whole.
I saved up a 15% down payment for my first truck.
That gave me a reasonable payment on a three year old truck for 36 months.
The bank held the title, but I was free to do what I wanted with that truck and lease to whomever I pleased.

When some people(not all) acquire something too easily, without investing their own sweat and money, they tend to not take it as seriously as they should, and bail out when things don't go their way.
They figure, why not, they have nothing invested.
But as the old saying goes, nothing ventured, nothing gained.

 

And you have a maintenance fund...they charge you to do what they normally do on Company trucks anyway so they make out with your money for that too