Well I disagree with these things and GMAN has been telling everyone to buy their own truck and go lease to whomever they want, the fact of the matter is people hear what they want to hear. We are running over 40 trucks and I don't own a single one of them. I don't want to own anything but I'm a rarity. We lose a lot of good drivers as they want to own their own truck. Of course they usually regret it but they are stuck. So if you can't beat them I guess I'd like to offer a lease purchase plan that is not a rip off.

From what I heard, some of these places offer debt and money classes to keep these guys in the truck which we think is a good idea. But we'd like to do it so after a period of time the actually own the truck. That's what they want, that's what they'll get. Of course if we have to shell out money to buy a truck, we will profit as well but we truly want it mutually beneficial.

Any ideas?

Thanks,

 

I've tried that 15 years ago with the "friend". It only cost me 12 grand....I was lucky and was able to sell that truck quickly. I meant I've bought the truck for somebody, not somebody for me.

 

If you want to offer a lease purchase to drivers, you will first need to buy the equipment yourself. You will be taking all the risk. I considered this at one time. I have had a number of drivers try to get me to sell them one of my trucks and finance it for them with nothing down. I decided to not do it due to me assuming all the risk. Most drivers assume that carriers who do these leases make a fortune on the lease. A few years ago I had an opportunity to discuss this with a major carrier who does them. According to him, it is kind of a wash. I think the primary benefit to them was driver retention. He mentioned that they had some drivers who would trash their trucks and when the driver got out of the truck, the carrier had to clean up the truck and do what was necessary to restore the truck to it's previous condition. I have no doubt that some carriers do make a decent profit doing these leases. But, it is the carrier who assumes all the risk. The driver who leases the truck can walk away at any time. If the truck breaks, the driver will likely not have the funds to make the repairs, so that also falls back on the carrier. You might be able to buy trucks, finance them and then put a lease driver in them. But, you are the one putting up the down payment and will assume the risk of making the payments to the lender. Before doing anything, I would want to decide what I wanted or expected from a lease purchase program.

 

Dealing with the something for nothing crowd is a real PITA. Think drivers will make you drink, wait untill you try LP's.

Are you going to do it through your current equipment set-up? Are your lease's turn in or can you buy out? If you can buy out you should have the written blessing from them to do this.

Going to pay mileage or %? Are your current lease's F/S? Can you extend that to the LP's?

You have to make an acceptable return on the equipment to cover those that leave damaged, broke, ect equipment.

Making me drink just thinking about it. Good luck.

 

Get out the aspirin.

 

The key to a successful program isn't the lease, it's the job. The reason most LP's fail is because the job isn't adequate to support the lease and allow the LPer to make more than a company driver. Most guys that think they're making money in their LP are only looking at cash-flow on a short-term basis. Eventually, reality catches up and the fact that they were making the same as a company driver but spending like they were making more does them in. I would never set up a LP program that leased the truck from day one. I would require that they be a company driver first and hold the LP out as a carrot. That helps minimize your risk because you're already familiar with who gets to participate in the program. If you want to offer classes or mentoring as part of, or leading up to, the program you can certainly do so. You just have to be sure that the rewards are in line with the hoops. Most LP programs are easy entry and the $1.35/mile revenue reflects that fact; that's how the carrier mitigates its risk. I would dispute the fact that most LP programs are a break even prospect for the carrier. That might be true regarding operating expenses, but the savings in taxes, insurance, and benefits is where the rubber meets the road for those companies. Those items alone usually account for anywhere from $.10-$.15 per mile for an employee. If a carrier can break even, or come close, on the equipment and pay side of the equation, that extra money goes straight to the bottom line. That's a significant bump in an industry where most carriers running operating ratios greater than 90%.

Create a defined path within your company and show a guy how he can move through it and what the rewards will be. The drivers you'll attract because they have the foresight to recognize the benefits, will already be of higher caliber than the average driver. You just have to be willing to part with a bigger piece of the pie in exchange for less headaches.

I've spent two years cultivating a contract that will allow me to offer a similar program. I'm just hammering out the details.

 

Your asking for trouble i think. If i a driver cant buy a truck that right way. He has no business owning a truck. Just my 2 cents

 

I think that if I were to set up a lease program for drivers that I would want them to have some skin in the game. I might work with them to come up with a good down payment, but unless they have the discipline to save toward a goal, I don't know that they would be able to make it as a business owner. Offering a training program for those seeking to do a lease might also be beneficial.

 

If they could come up with a good down payment, they wouldn't need to lease purchase a truck, they could buy one from a dealer

 

First company I leased to talked big of a "training program" etc.

I would trust neither the company or the program that attempts to create a basic business program and labels it as something it's not.


These guys are looking to create a business. Reality, you are offering a glorified company drivers position.