Newbie looking to be a fleight owner

[Fresh]

I have been reading the forums for some time now and I am very interested in becoming a fleet owner for one of the larger expediting companies. Although recently I have really been having second thoughts. Here is the plan that I was looking at doing. I am looking at purchasing a slightly older model truck 2001-2003 spending roughly 16,000 to 28,000 dollars on the truck. Once I have purchased the truck listing it with one of the larger expediting companies to keep it full. My biggest fear is not being able to keep the truck loaded and on the road enough to make the payment/insurance/other constant costs on the truck. I am not looking to make tons of money I am just looking to cover all cost that I could occur and maybe have a few dollars left over at the end of the year for myself.

Has anyone else been in this situation or have most fleight owners spent time out on the road themselves?

Also, as for the money I have plenty saved up to cover the costs that I will occur if any issues come up. I just want to make sure that this venture can be profitable and not extremely high risk.

I look forward to experience expediters input and thanks for all of the information that I have already received.

 

[cheri1122]

Fresh: first, welcome to EO, where the questions get asked, and answered, for newbies and veterans alike.
Let's start with a clarification: a fleet owner is one who has more than one truck, which doesn't sound like what you intend to be, unless you're planning to add more trucks.
Buying the truck, and signing on with one of the big carriers, is the easy part. The hard part, is finding, and keeping, a good driver, or team, to run the truck. You will find lots of discussion on this subject, if you research the archives here - it's a perennial problem for many owners.
Your biggest fear, "not keeping the truck loaded" enough to pay all expenses, is the same as that of many others, because there are no guarantees in this field. The freight may be slow, or even nonexistent, at times - it's the nature of the beast.
Whether you can make it profitable, depends in large part on how much research you do before making any commitments: how to choose a good truck, how to find a carrier that fits your style, finding drivers who are honest, reliable, and will run your truck as you expect, (and the important matter of putting everything in writing, in a contract that spells out the responsibilities of both parties), and a million other matters that matter, such as finding loads, if the carrier doesn't, at times.
There is a lot to learn, if you're just starting out, but this is the place to learn it. Read everything you can here, especially the Newbies, General, and Truck fora, including the archives, and you will have a much better idea of how to minimize the risks. (And avoid the mistakes that some of us have made, and been helpful enough to share.)
Best of luck to you, and happy reading!

 

[RichM]

Your main problem will be finding and keeping drivers. Many drivers are spolied and want trucks with all the amentities that can be bought. Your $16-23,000 used truck will more then likely not be equipped to the spoiled drivers standards. An older truck will incur more maintenance resulting in downtime which means your drivers are not earning any revenue.
I would suggest that you read through the various threads about being a owner only. Lots of horror stories on here about owners and drivers. Best to really resarch this out and one important item is to make sure YOU have a CDL and can drive the unit .

 

[LDB]

You've had good advice so far and I have to agree with their points. I'll also add that if you haven't actually done this you are in a worse position to know how to advise those who are in your truck. It would be nice if a night at a Holiday Inn Express was the ticket but it isn't. You'll be asked where they should reposition to at times, if they should go where the QC advises or somewhere else at other times. Is this a good location on Thursday night to get a job Friday and be rolling over the weekend? Is it a good spot on Monday? Where should we buy fuel? The list goes on and on. If you haven't btdt you won't know as many answers.

For a $25k investment you'll likely either find old worn out claptrap trucks with fairly decent size sleepers that might minimally satisfy the desires of drivers or a somewhat decent truck with a sleeper only a hard core minimalist would accept. As already mentioned, be sure you've read back at least a year in the general, newbies, truck and recruiter forums. Good luck.

Leo Bricker, 73's K5LDB
OOIDA Life Member 677319, JOIN NOW
Owner, Panther trucks 5508, 5509, 5641
EO Forum Moderator
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Support the entire Constitution, not just the parts you like.

 

[arkjarhead]

I've never owned a truck, but my advice on buying a truck is this. Don't buy a truck you wouldn't want to live in. If you don't think you could stay in it for 2-4 weeks at a time then chances are no one else will want to either. Just my 2 cents.

 

[davekc]

As mentioned, welcome to EO. To serve and educate yourself and the members, it would help if you describe what YOUR definition is of a fleet owner.
The responses will be different based on that answer.












Davekc
owner
23 years
PantherII
EO moderator

 

[Mcarriers]

Fresh, The advise that you have been receiving has been very acurate. We purchased our second truck, a very good used DR unit last year, it is a 2001 with an 84" sleeper and is a ten speed. After trying off and on to find a team to drive it the first year we finally realized that we would have to drive it ourselves and find a team for our 2003 automatic with the 96" sleeper and all of the bells and whistles that we had custom built for ourselves. It is VERY hard to find and keep good drivers. There are large fleet owners that buy brand new units and it's hard for the small fleet owner to compete for good expierienced drivers with older equipment. You can be succesfull but, I believe it would be a good idea to start out driving yourself and learn the ropes, it helps being a hands on owner. That way you understand where the drivers are coming from when they call with questions or problems. Getting info here is a very good idea, I should have done more homework before I jumped into the fleet owner ordeal. Good luck on your business venture, I wish you the best of luck!!!

Mello

 

[Fresh]

>As mentioned, welcome to EO. To serve and educate yourself
>and the members, it would help if you describe what YOUR
>definition is of a fleet owner.
>The responses will be different based on that answer
>

My goal would be to start with one truck. From that if everything goes well I would slowly add trucks.

Thank you to for everyones help. I agree I definitely need more experience with dealing with day to day issues of being a truck owner. I was just thinking that if I could purchase a truck and keep a solo driver in it I would be able to cover my costs and learn as I go.

Thanks again for the help.

 

[davekc]

I would recommend that you steer clear of your plan until you really know how this industry operates. Several of the concerns are already listed with regards to finding a decent driver. They all look good in the beginning, but many horror stories depicted through the EO archives is what lurks around the corner for the unsuspecting. Unless you already possess a strong transportation background, you really need to "walk the walk". A potential driver could be putting the screws to you, and you wouldn't know it.
Another issue is capitalization. Just a recent story on the EO general forum talks about a guy that bought a lemon, and it cost him $21,000 plus hotel, lost revenue, and other costs. With buying a used truck, you have to have availability of funds close to your used truck purchase price. A major component failure will put you out of business as well as jeopardize your investment.
You really need to study this through, even more so when there is more uncertainty in the economy.
The good news is that you are finding this information out BEFORE you make a mistake.












Davekc
owner
23 years
PantherII
EO moderator

 

[Moot]

I'm not a fleet owner nor a communist. Never have been. I think being a fleet owner in the expedite business is similar to being an absentee landlord. If you lived on the west coast, would you buy and rent a single apartment on the east coast?

I realize you must start somewhere, so why not where you live? Find a local cartage or airfreight company that leases owner/operators. Do some research, buy a truck and hire a driver. I'm sure you will find it easier to learn and run a business at the local level first.

 

[ATeam]

Fresh said, "I just want to make sure that this venture can be profitable and not extremely high risk."

While not doing half-bad as an expedier, I have never been a fleet owner and never would be. I view fleet ownership as an extremely high risk venture with profitability resting on numerous factors that are beyond your control.

I personally know several experienced expediters that have tried their hand at fleet ownership and wish they had not. When you get them talking about their experiences, they all talk about the difficulty of finding and keeping good drivers. Then they move on to a variety of other challenges they faced and did not overcome. They concluded fleet ownership was not for them and got out as best they could.

Some of those got out at a loss sustained over several years while trying to climb the fleet ownership business learning curve and maintaining false hopes that things would get better.

Starting out with one truck with the idea of learning the business does not mean that you will learn the business, especially if you are trying to do so without going out on the road yourself.

I invite you to take a look deep down into your soul to identify WHY you wish to become a fleet owner. What is it about the opportunity that attracts you? Is it having people under you? Is it the good feeling you would get, or think you would get, from owning and running trucks? Is there something about the trucking industry drawing you in? Is is a desire to make big money? Is it the idea of sitting poolside at home while drivers use your equipment to move freight and channel money through your books? Is it the math that makes sense on paper that shows if you spend $X on a truck and drivers run it $X miles, you can't loose? Or is it one or more of a hundred other reasons people have for becomming fleet owners?

Take a rigorous and honest look at your motives and desires. It may be that what you really want can be found with less risk and better opportunities for profits in other business ventures.

 

[fastlane_frt]

Hey there, looking for your driver? if you decide to do this, email me at [email protected], I am looking to drive a unit soon, Get a truck with auto trans comfortable sleeper, a tv, dvd and gps system. A generator is good to have too for the cold winters , saves fuel and helps heat the truck in the cold winter months. I will run for almost any carrier,I have seen Bolt and Tri-state in my area so they would be first choice... just help me get to orientaton, I'll pay fuel if you can advance me the money to start. I could stay out 3 weeks at a time if needed with a week off after, 2 weeks for 4 days out. You work with me, I'll work with you.

 

[terryandrene]

Fresh:

The previous poster brings to mind additional expenses you may be expected to incur when seeking a driver for your truck. In addition to expecting you to cover orientation travel, food and lodging expenses, your driver will also need a DOT physical, a Drug and Alcohol Test and possibly a background investigation. After paying for all of the above, there is no guarantee that the chosen carrier will approve your driver's application.

 

[davekc]

Terry is correct. There are many hidden costs a new fleet owner must be aware of.
As to whether it is a "high risk venture" is debatable. It has it challenges, but so does pretty much any other business venture.
Liken it to the retail or restaurant business or any other.
The only challenge I would see is if you are only reliant on the carriers performance for load availability. Then it is similar to a franchise operation. There are plenty of options available to address that concern whether running under your own authority or leasing with a carrier that lets you obtain your own freight.












Davekc
owner
23 years
PantherII
EO moderator

 

[greg334]

I don’t know if this will help you but I would keep in having second thoughts.

There is a lot of good advice here, some rather odd advice in a couple posts but overall I would think the biggest issue is the driver(s). One such thought I have is even though the company that you are contracted with, unless the driver(s) are employees, there is no control over what they accept for loads. Believe me I have had employees and will never EVER go back to that situation for any reason especially in this industry.

There has been a few who have been put into a truck with absolutely no experience, get to be part of a company at the top and allowed to take advantage of all that can be offered in training and become somewhat successful but this is luck that few can actually can ever do. These drivers are rare and with new fleet owners, they are very hard to find. So consider training as part of the problem. This also ties into the first paragraph, where can you expect to find experienced people to put into the driver’s seat? Because you don't have real experience in this niche market (you won't know anything even after 4 years of driving and being an owner) so you need experienced people to make up for your inexperience.

As much as I would say anyone can do this and it is easy work, not everyone can and even if they got a cdl, does not make them capable to drive the truck. Remember that your liabilities are not the company's liability and being a business owner, you always ALWAYS limit your liabilities first and foremost.

So the success of your driver is the foundation for your success of your company – it all comes down to that.

Now the other end of it is the business end of it, this is a business, not something that one can get a truck and be successful with right off. Outside of having a big reserve, I would start with putting everything down on paper from this thread, put the goals, what you think your business should look like in 2 and 5 years and organize all the information add in other cost like plates, insurance and what ever else Then take all that information and look for an accountant and a lawyer and go to the SBA and find a Mentor who has industry experience and sit down with each and present them with the idea, and let them advise you before you even start looking at trucks. Remember if you pay for advice, use it, you paid for it.