Why is it so hard to make money as a independent?

I don't know that number,but I know a hundred times
more ex-owner ops who are now back to being a company
driver again who say they'll never buy another truck.

 

I'm not really saying never bring on any more o/o under your numbers. What I'm saying is be very selective in who you bring on. You want o/o who are financially stable and most of those have their own authority already. The last thing you want is a bunch of operators looking to you as a personal piggy bank and every personal or business crisis they have is supposed to be your problem also. So you can cover fuel for a few extra trucks? That's great, you've done a good job with your money.

Don't waste your time and money with some losers needing advances every day or can't afford some steer tires. Hold anyone you lease on to your standards. In your shoes if someone were to ask me about advances their resume and application would go in the shredder as soon as I got them out the door. You have standards so make sure anyone you lease on is of the similar mindset character.

 

Thanks a lot. Its good advice from a stranger. Friends havent even put it that way. I dont like to be a piggy bank for people. I guess if Im gonna be one then I need some collateral like a truck. If I held title to the rig and supplied capital to get rolling and then paid driver at reduced rate or agreed rate/split then sell rig back when inital start up cost and ROI are gained,do you see that as a doable situation? a win win situation? high risk low(er) risk? how do you see or how would you get in if you were on sidelines watching the transportation industry but did not want to be gone from family for extended periods of time?

 

Well said RC to many o/o need someone to hold their hand.

 

Yeah you can do those things. But it still doesn't guarantee you'll get your money. Really it's just more distraction from your core business. Who needs that? You're thinking in terms of 25%+ return on something maybe and I see headaches. The possibility of someone skipping out on what they owe you with absolutely no qualms about it whatsoever. I think that is the risk you'd be taking on with those sorts of arrangements and deals. If you're ok with that then it's cool. Just go in eyes wide open. Money management or lack thereof is a good indicator of character. Those drivers represent you at customers and have your name on the door.

 

You are right about that anf I appreciate your candor. The returns look really good on paper, but as you said they could walk anytime. There is a lot of opportunity for that to happen no matter what. If you could hold rig as collateral would you do something like this to start a company and add trucksbecause more compaany trucks reduce risk to a certain degree.

 

If you're asking me, I'm telling you no, I wouldn't touch anything like this with a forty foot pole. And like I said, I'm not knocking the idea, nor am I knocking people with dinged credit, etc. People make mistakes I understand. If someone has made one and they've changed then they better learn some good sales skills to get what they want in life if they face an obstacle from that failing. If I were looking to lease on drivers the bar would be really high. Don't make any apologies for it that's just how it is. There is a place in the world for these Lone Mountain's and Schneider Finances but for me no way I'd want any part of that. You need to figure out what kind of company you want to be. Me, I'd rather just be a trucking company. Move freight from A to B. I don't want collateral in a bunch of beat up ragged out trucks, no thanks.

 

I'd suggest that luck played only a tiny part in your success. Words that don't belong on business plans include: luck, fortune, chance, hope, and a few others like that.

Here's two more that sort of go hand in hand:

3. Work ethic and problem solving: Are you someone that can solve their own problems? Are you truly ready to make substantial sacrifices and do whatever it takes to make something work out? If not, failure is likely. There is no "team" in "I". As an independent, it's all you.

4. Lack of Entitlement: Do you really accept and own responsibility? If not, failure is likely. If you have a checklist of benefits you need in a compensation package, or are someone that's worried about how fair things are, you probably should remain as an employee for someone else. Being in business means taking on risk in exchange for potential.

 

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red, dang good post. and you are right luck had nothing to do with it. I should added in parenthese the words " dripping sarcasm". the decisions one makes determines the outcome