Yearly Profit After Expenses...

Red, You guys were very helpful to me and JMC, too. I can't believe how many trucks are available now, and with just a bit of legwork, I'm certain a very good truck can be had for 10k or under. Certainly the 10-20k range can get a truck with average miles but was well maintained, I've even seen them with recent tires, brakes, in-frame, etc. etc. For 10-20k it seems to me one could afford to buy the thing, fix up the obvious and such, before getting authority, etc. I'm bidding on a few right now, I'll let you know how that comes out. The bad news in this is that there must be hundreds of O/O's and small carriers that have just been hammered, have had enough, and are getting out. Anyway, Thanks again for all your advice, I'm taking it slow and trying to get the plan in order.

 

Just wanted to check, Duteman.

 

Glad to hear it.

I have got to be honest. When he first came on the scean I would have thought he was setting himself up for failure. Or loosing his woman at minimum.

I love to hear about younger people taking risks and making it happen. Can you imagine them in 10-years? With the sacrifices they are making today they are setting themselves up for a very nice life in the future.

 

Well thank you for those kind words BBB its good to get a little more motivation sometimes. I have to admit at first I though you were an A-hole but I see now that the people of this forum just deal with to many starry eyed people to not get annoyed by the next young guy gonna "strike it rich". As for the Florida lottery we kind of got screwed on this one after counting in DH we will average around 1.98/mile which is not bad by any means but is a little under what we like. On a good note I took some of our numbers and plugged them into my spreadsheet and it looks good without counting in extra maintenance we come in around a 4.8% profit margin after all expenses. However after throwing that extra stuff in there it is a fair loss of around 10k total. For you new guys out there that just goes to show you what can happen and why all these folks say to have plenty of money. We had to have our IFTA tags for next year mailed to us as we have no plans to return to TX before next year so we are still in Florida (FedEx is supposed to be here today though). After that we are trying to decide if we should take something cheap from a random broker to cover some costs of getting out, or just cut our losses and DH out, any suggestions. As for Duteman when you get that truck CHECK IT OUT very thoroughly and even have a couple others check it out. Our truck had pretty much brand new drives and brake shoes on it but we later found out that the brake drums were pretty much shot. Due to this even though the shoes were still thick they had huge grooves in them from the drums so it was time to replace. The trailer brakes got us as well we checked it out and picked it up at night so we couldn't really look it over as well as we should've. As a result of this the really good looking brake shoes on it were cracked and we could tell with the flashlights. The drums were still good though. Anyway just a couple examples how something can be made to look pretty for a thousand dollars and they will sell it for 3k extra.

 

Hey JMC, thanks for the heads-up. I'm pretty handy, and have enough experience with the mechanical stuff to try to catch all the obvious problems right off the bat. I'm the type of guy that would replace all the rubber maintenance stuff... belts, hoses, and the like, just because it's "cheap insurance" and if you do it yourself from day one, you know how old they are. I have learned the hard way that you feel like an ### when you are stuck hundreds of miles past BFE because of a simple broken belt, or a bad thermostat or something small. So cheap to fix, when it's on your time, so expensive when it's somebody else's. When I get a used vehicle with unknown service I routinely have the radiator rebuilt too. Now I'm well aware that "stuff" happens, and in spite of a persons best laid plans, one can get stuck up the creek at times, but, a little bit of a "pre-emptive strike" on PM can be worth it's weight... Frankly, I'm not all that surprised that you've had the maintenance issues you've had, and I too think it's great that you all just took the plunge and set out on the road... "if it ain't broke, don't fix it" has it's merits too. Frankly, both you and Red seem to be experiencing similar repair issues, but, in the big picture, I see them as small bumps in the road. Please don't think I'm being negative at all, 'cause you could have taken the advice of some of the early nay-sayers and bought a truck for 10k more than you did... but there would be no guarantee that you would be problem free even at that price point. Heck, new trucks are often problem children, and better men than I have gone broke and out of business in a hurry because the POS brand-new lemon is in the shop, AGAIN, loosing money not earned, loosing money for the payment, and costing MORE money getting fixed. I think you guys did the right thing. Don't forget that invite is sincere... and for you and your Dog, too, G/Man!

 

P.S. JMC... it may feel like that 10k is a loss, but remember (and keep telling yourself) those are deductible business expenses. If you have a chance go back and read the threads on business models, and especially Red's posts about his experiences with changing his business model. If you and your lady are set up now as a partnership you may want to consider becoming a Sub "S" corporation, an LLC or perhaps even a "C" corp. I mean, if It were me and it was a "C" corp I'd deduct the cost of DHing north out of Florida as "deductible travel expenses" to get to your shareholder meeting... that just happened to be in a nice hotel, back up near a better paying route... I'm just sayin', there are lots of creative ways to use the laws to your favor once you go corporate...

 

JMC. I have two questions.

Knowing what you know now would you still do it?

And what would you change if you could start over?

 

I appreciate it, Duteman. I don't have a dog, so if I make it up it will be just me. I do make it up to that part of the world every now and then. Someone will want me to go up much more than I want to not go. It would be good to meet you if I can make it.

 

I agree with you about selecting the best business form for your situation. How a business is structured can make a big difference in your tax bite. I would advise those starting out to seek the guidance of a tax attorney or CPA before making a decision. I would also encourage anyone wanting to start a business to concentrate on revenue generation first and then worry about paying taxes. I don't mean that you don't need to do some tax planning, but you won't have to pay taxes unless you make a profit. If you find a good tax advisor first, they can worry about preventing you from paying too much in taxes. And their services are tax deductible.

 

BTW I am not advocating that people CHEAT on their taxes, but it's amazing what the law will allow. The scenario I described... having a board/shareholder meeting somewhere in the world, then having the corporation pay the costs of getting there, and the rooms for the board members, and the "meeting room"... is completely legal and in fact is an expected event in a corporate year. It would throw no "audit red flags" at all. DON'T FORGET TO USE THE COMPANY CHECK BOOK! Keep the money separate at all times. It's really not that hard once you get used to it.. DO get professional advise.