I have been a company driver for the last six years both local and OTR. Lately I have been considering buying a truck and going at it as an O/O.
Am I crazy for even thinking about this?

 

if you have been keeping track of your expenses find a good truck and lease on with a decent company if you do not have your own authority and your not just doing it to own a truck then go for it

 

It is not at all about just wanting my own truck. It is more about the ability to make more $$ than I am now. Is that even possible as an O/O after all of the expenses like truck payments, insurance, fuel, taxes, permits, maintenance, repairs, etc. etc. are taken into account?
I am not the best records keeper in the world but I already know how important saving every recipt is.

 

the best man to answer this question is going to be GMAN. He will tell you the straight scoop. I make good money but i did not go out and buy a truck that was all chrome. My first truck was a FLD120 ugly as sin but a great worker. rebuilt motor with paperwork and paid only $18,000 so i did not have a huge truck payment.

 

If you take those expenses you mentioned (you need to really think hard on ALL your fixed and variable expenses) and make sure you add the following:

1) Driver pay...add driver pay as an expense. Your business will need to support a driver if you are incapacitated. Use your pay or a good standard like 35-45 cents/mi.

2) Add a ROI (return on investment) on the cash you will spend to buy the truck. If you don't then you should have kept that money ($18K, $50K+ or whatever) invested and earning interest somewhere else. It should be a min 12% yearly return.

Then compare the sum of those expenses to your projected revenue....does it still look better as compared to what you're currently making?

 

If you have 6 years in the industry and haven't talked to a few companies yet, then its hard to say.

I didn't vote because I don't know what type of equipment you operate and what type of freight you pull.

You can lose your shirt as an o/o, or you can rake in the $$. Owning the truck doesn't ensure the raking :wink:

 

You have enough experience to understand what this profession entails. I will caution you that owning a truck is much different than driving one for a company. One of the most important things to remember is to have a good nest egg saved. A major break down can occur at any time. If you don't have the money to make the repairs, then you are out of business. You need to look at this business realistically. I am not trying to discourage you, but one reason so many people fail as owner operators is they fail to plan and look at their investment as a business. A business must make a profit or it ceases to be viable.

Things are slow right now, so it would be better to wait until the economy begins to improve before buying a truck. That should happen around spring, depending on what you haul. Some types of freight are not as affected as others. It would be a good time to begin checking around to see what is available and what you might need to pay to get what you want. If you take your time, you can usually find a good buy.

I suggest starting out with a good used truck. You need to keep your overhead down until you get a feel of how you will do. If you keep expenses down and operate your business at least as well as you do as a company driver, then you stand a good chance of doing well.

One other thing to consider is what type of freight you want to haul and to whom you would like to lease.

 

Lots of good advice here gentlemen, thank you. Keep it comming. Most of my experience has been with your basic 53' dry-van with some limited time pulling reefers and doubles. I am way too old and out of shape now for flat-bedding.
My "nest egg" is probably too small and is "earning interest" but not nearly at a 12% annual return.
So, how much "mad money" would one need saved up in advance to go about this properly?

 

What companies are you interested in pulling for? Does your current employer offer o/o opportunities??

 

Some recommend having about $10,000 put back for emergencies. The main reason to have a good nest egg set aside is in case of a major break down. You will break down, whether your truck is new or used. When it does, you need to have the means to have needed repairs done. Hopefully, nothing will happen for a while, but if it does and you are prepared, then you won't be out of business.