Thinking about becoming and O/O, would like some feed back.

I've been thinking about buying a truck and trailer and going into business for myself. I been driving for 5 yrs now and getting my CDL is the best move I ever made. I have my tank, doubles/triples and hazmat endorsements, I started out for the 1st yr doing OTR dry van but I'm currently running flatbed for a very small company. I do have tank and heavy haul exp also. I've had no tickets or accidents since I've gotten my CDL.. All of my driving has been amd is currently in the Northeast (M.E., N.H., R.I., Mass, V.T., Conn, N.Y. including NYC and Lond Island, Penn, N.J., M.D., Del and V.A.). I have about $125,000 (cash) to get my business started. I am wondering if running on your own authority is better then leasing on with a company? (If it makes a difference I'm not married, I do have a girlfriend but its not serious). I do have a 13 yr old son who loves riding in the truck with me but he lives with his mother (I have visitation every other weekend, but we get along for the sake of our son so visitation can always be changed). Any feed back or comments about starting my own business anf becoming an O/O would be greatly appreciated.. Thanks in advance and keep on Truckin..

 

Study the OOIDA website for the business end of being an 0/0.

 

Thank you for the advice. I just recently started doing research on everything I will need to get this business started if I decide to do it. I'm sure reading up on that web site will really help..Thanks again..

 

I certainly think you're in a great position to move forward as an O/O financially and depending on your credit, and I wouldn't hesitate that in your position I would buy new. You've got the required down, I'm sure and why take the risk of buying a used truck and ending up with endless repair bills.
It's the one big regret I didn't do when I became an O/O. It cost me dearly.
If you have no experience with your own business then it's perhaps prudent to start off being leased onto a company but of course youre going to have to decide what you would like to haul.
You have heavy haul experience, so that might be the best avenue to start.
But there's so many ways to go. Having your own authority may not suit you and you may end up, as I did, just leasing on.
Its certainly worked out for me and I also would advise you to get an excellent accountant that's very familiar with trucking. But you've probably surmised that already.
good luck.

 

Spend $80,000.00 on a good newer used truck (almost new with warranty still active), hold onto the remaining $45,000.00 for any emergencies, and do your homework on a really good company to lease on with.
Drive out the lease with the company (usually one year) THEN decide if you wanna go Independent. You have the "trucking" experience...now get a little bit of Owner/Operator experience. Just my 2 cents.

 

I can tell you from experience that running under your own authority takes a whole lot of extra work. I have a wife that helps me out immensely with the compliance and record keeping tasks, and getting loads. I don't think I could do all of that and drive and take care of trucks and trailers at the same time, it would just be too much. That said, you are in excellent financial shape to make the jump if you want. Expect to spend about $20,000 getting your authority active and setting yourself up with all of he extra stuff you will need. Just remember, your own authority makes you a motor carrier with all of the same responsibilities as any other motor carrier. It's not easy but I have found it very rewarding. I enjoy trucking now more than I ever have.

 

i cant tell you what to do, but i will tell you what i did, you choose for yourself

i bought a used truck and trailer (total was $35 for both) i had already been driving the truck before i bought it, the guy i drove for wanted to get rid of it, i paid for both in one year

he lost his authority,

i got my own plates, IFTA, bobtail, etc

i leased onto about four or five different companies over a period of three years. i truly believe that gave me the experience i needed before i got my authority (dealing with brokers, properly maintaining the truck, lanes, fuel costs, what freight is good and what isnt)

then i got my authority and have been loving it ever since

i truly believe every driver should own his own truck and trailer and have his own authority. why let other folks get the lion's share of your work?

 

my wife is the better part of my company, without her i would be sunk

how do you get $20k, to get your own authority?

i spent $2500 and that included the liability insurance

 

Sorry, but I have an opinion that is a bit controversial and not popular. I recommend going w/ a lease or lease purchase for a little bit first. Couple of caveats: make sure it is a TRUE walk-away lease w/ a reputable company. In other words, you can turn the truck in anytime w/ no penalty. OK, true; you don't develop ANY equity; BUT the way most conventional financing is structured you are only developing a tiny, little fraction for the first two years anyway. 90% goes toward the interest. So here's the rationale:

You by a rig conventional financing: You go at it a year and boy: This just ain't gonna work for me. You are stuck w/ selling the rig, or turning it in to the finance company voluntarily, or they repo it - who will then sell it. The new truck is now used and no matter who sells it; most likely there will be a descent shortfall in the loan; which the finance company WILL pursue all means of recovery against you; and all the cash you had is now gone. If it wasn't you'd probably still be at it. You spent the money as a down payment and running your business before deciding: not for me. Back to being a company driver somewhere - with poor cash for home bills and a big judgement against you for the shortfall.

However, if you had tried your legs as an independent in a lease scenario (keeping that cash in thee bank, drawing interest and adding a little more to it each week) and the same thing happens: This ain't for me - you walk away Scott free and still have your big pile of cash in the bank, and made some money while yo learned the hard way being independent isn't your cup of tea. On the other hand; IT IS FOR YOU and you have tested all your theories and business strategies leasing and it's working out great and you know this IS for you: You bail on the lease and have even more money, you took care of the truck so you should get a good chunk of escrow back, plus it turns out you are a good business person and grew your savings even more by adding to it each week and the real world knowledge of what it's like being an independent. Charge on under your own head of steam in conventional financing with the best possible shot of making it work well for you. A little time in the sub-prime rate trenches taught you what you needed to know;

I can do this - or I can't. In either case testing those waters in a true walk away lease or LP for what; say 6 months, was a safety net in case it's not for you and all it did was keep you from developing a tiny tad of equity in your truck (not enough to cover a shortfall on a sale) and for those few months you made a few thousand dollars less gross revenue than you would have going true OO Independent.

It all boils down to YOUR particular appetite for . . . RISK. Risk is part of the game all Independents play. It boils down to how much risk to take and when. If you are a company driver going Independent, as a L/LP Op and some good business sense and discipline (which ANY Independent must have), you make a little more than a company driver; BUT you have to do all the things that a regular O/O does; well not one running under his own authority. THEY have to do a tone more w/ permits, drug and alcohol compliance, collecting the money owed, etc. You do pretty much all the same things you'd do if you bought your own truck and leased on to someone. So you get the feel of what it's REALLY like to manage your own business from the road; but you don't have the risk if you decide it's not for you. What you give up for the lower risk is what you ALWAYS give up w/ lower risk. A little more revenue income up front, but your $125K is STILL in your bank account if you decide to go back to being a company driver.

Being an Independent isn't right for everyone and the only way you'll know for sure if it's right for you is to jump in and go for it. L/LP Op scenarios are totally sub-prime deals - but they offer much lower risk too. Just something to consider with the caveat: It MUST be a TRUE walk-away lease and you are just doing it short term to get some low risk real world Independent experience before throwing $125K into the Independent Poker Game.

I

Best of luck hand.

 

animal

i too started off leasing with the megas, before elogs of course

i had fun and made money