Is or has there ever been a study or any info in general on the failure rate of O/O's? Everyone has heard that there is a failure rate of 70% or better in the resturant business, anything ever done for trucking? I just find it amazing how many people will jump in head first with NO reasearch what so ever.There seems to be no end of suckers to gladly haul for $.90 or less.

I read everything trucking related and I have never read anything other than repo numbers.

 

I believe OOIDA did a study on this...http://www.ooida.com/

I searched briefly but couldn't find anything.

 

I doubt if you will find hard numbers on failures. The main reason is that carriers don't want high failures associated with their fleece purchase programs. Technically, a lease operator isn't an owner operator and could be excluded from the figures.

I think a lot of people get hooked into either buying or leasing trucks who should never do so. They don't have any driving or business experience, so don't have any idea of what operating expenses run. Since they don't know what it costs to run a truck, they go to work for a company paying $0.85-0.90/mile. Many buy or lease a truck without adequate capital to repair a truck when the truck breaks. Some could not even purchase a tire without help. Blow an engine, transmission or rear end and they are out of business. They get caught up in the chrome and hoods which cost more to purchase and operate. Most get less fuel mileage than an aerodynamic truck. Since they don't have experience, they make bad business decisions. When you don't have a cushion to fall back on, they fail the first time something happens.

My guess is that the repo rate is only the tip of the iceberg. Those who fail doing these fleece purchase programs have a high failure rate and are not likely to want to post their true numbers. When one fails, they simply put another sucker into the same truck so it doesn't make it to the repo lot.

I wish the failure rate was not so high. Unfortunately, there are those who will jump into this without much thought or research. They allow their emotions to rule them rather than sound logic. With experience and a good savings account, you can weather most anything. It is the "I want it now" attitude that causes many of them to fail. Rather than waiting until they can really afford to buy a truck, they go out and get one any way. Until people look at this as a business they will continue to fail.

 

Yes, never heard of " numbers", but few years ago, "Fortune", rated trucking business #1 in a failure rate.
So it wouldn't surprise me, if those # were 80-90%! :roll:

 

I would not be surprised if the numbers were as you stated. I think the failure rate mentioned by Fortune was for carriers rather than owner operators. My guess is that they would be comparable. Unless carrier's were willing to make those figures available, I don't see any way to put real numbers together. I don't think they would see it in their best interest to make the numbers public. Most would not want to have any new drivers to know that they had a 90% failure rate with their owner operators who leased on to them. It may not even be a factor in their operations, but from a lack of experience of the owner operator. And I don't see most owner operators who have failed as wanting to make it public knowledge.

 

I heard 75% in first year somewhere? Most drivers will make more money as a company driver than a lease operator in most companies that have both!

 

I'm sure the companies would go to no end to make sure failure rate numbers would never get out. If companies like Swift have 120%+ turnover rates for just their company driver, I can just imagine their "lease" failures.

To me leasing ANYTHING is a money loosing endevour, but thats just me, and another topic.

We all have our quesses/ assumptions on the failure rates but I guess this will be one of the great unanswered questions :roll:

 

Five years ago in college I had an evening criminal law class taught by a Placer County (CA) DA who was moonlighting.

One of the cases we analyzed in class was a failing O/O who torched his rig for the insurance. Something went wrong and his Buddie who was helping him was killed. He was convicted of arson and murder.