starting up, looking for drivers, questions

[Moot]

Greetings Mr. Wilson. You are wise to discount most of the advice you get here on E.O. Too many on here look at your situation through the eyes of a driver or single unit O/O (owner/operator). I would even write off the advice of Davekc. He's in this business for the long haul so to speak by hiring and retaining experienced top notch teams. He knows nothing about making a quick buck and bailing out.

Over the years I have seen the expedite freight industry go from a niche market to more of a TL (truck load) type market. More large companies are involved in expedite and the TL mentality seems more present. 110% to 120% driver turnover is now acceptable. You and your partner have no experience but do have a desire to make money. So why not adopt a TL business plan similar to Swift or Schnieder and crank up the driver mill. Maybe you could bring about the only thing that expedite doesn't have that the TL carriers do, CDL training.

If I can be more blunt than RLENT I would have to ask, if your buddy at Panther is making the big bucks and has all the answers, why are you here asking questions you really don't want answered? Is it possible your buddy at Panther isn't telling you the whole story and you seek verification from other sources?

I'm just an ignorant van O/O so what I have to say isn't worth much and I wouldn't blame you for dismissing everything I have just typed. The best piece of advice I have seen in this thread is quoted below:

These folks are attempting, beyond call of duty, to try and keep you from stepping on your crank. Why are you so dead set? Did your Bud tell you it feels good?

Read it over a few times and then give it some serious thought. Good luck in your business endeavors and please remember my contribution to your success should I ever come to you looking for a job. Jeez, did I just burn another bridge? Oh well!

 

[Bruno]

well, yes, we do want to hear that we can become millionaires!!! we do want to hear that it is possible. otherwise i'd be watching college football. we're just two guys with optimism and a working model, looking for knowledge.

again, we DO APPRECIATE the responses.

As a friend of mine said to me once " It's not what you make, It's what you keep". As a fleet owner with nine trucks and being in the business since 1995, I can tell you it's not as easy as one has lead you the think. One of my top drivers became our fleet manager and now understands why my hair is going gray. Davekc is a very good person that has helped me many times over the years. I call DaveKc when I'm not sure of something, because Davekc knows Panther very well. If your going to buy a truck get a 10 wheeler without the reefer unit, just a liftgate. Good luck. Oh if you plan to become a owner only then buy a few tractors on the Panther Lease Program. You can walk away from them at anytime if things don't work out.

 

[danthewolf00]

mark i have a question are your friends 4 trucks all refers?

 

[Turtle]

There are three things in life that you never, ever do:

Walk the pitcher.
Make the third out at 3rd.
Mortgage your house to buy a truck.

 

[BillChaffey]

Burlington Vt. You could call someone \ anyone at 1:00 AM or 10:00 AM on any weekday you wish and have trouble finding someone to fix a flat on Route17. Primarily because route 17 is in New York State not Vermont. Fortunately the Colonel doesn't dispatch me.

 

[CharlesD]

There are three things in life that you never, ever do:

Walk the pitcher.
Make the third out at 3rd.
Mortgage your house to buy a truck.

And a few more:


You don't tug on Superman's cape
You don't spit into the wind
You don't pull the mask off that old Lone Ranger
And you don't mess around with Jim

 

[RLENT]

Primarily because route 17 is in New York State not Vermont. Fortunately the Colonel doesn't dispatch me.

Actually Bill, there is a Vermont State Route 17 (runs east/west) that is south of Burlington

 

[jjoerger]

I don't think anyone is trying to stop you. They are not trying to keep you out of the business.They are just trying to save you from losing your house, credit, sanity, etc.

You need to get a little experience before investing the kind of money you are talking. You need to learn about the costs involved in owning a truck. Like how much tires, oil changes and other types of maintenance cost. Do you know what an IRP plate is? How about IFTA?

And you better have the knowledge and proper license to drive whatever you buy. At some point you are going to have to drive it.

 

[BillChaffey]

Route 17. It's also twenty miles south of Burlington.

 

[greg334]

If your plan is to run reefer trucks for Panther, not one person who has responded would be competing for the freight that you want.

Excuse me Cheri, tell that to my reefer truck.

 

[cheri1122]

If your plan is to run reefer trucks for Panther, not one person who has responded would be competing for the freight that you want.

Excuse me Cheri, tell that to my reefer truck.

Last I heard, you were with the Fed - got fed up, didja? I know Dave C runs with Panther, but not reefers....

 

[x06col]

Burlington Vt. You could call someone \ anyone at 1:00 AM or 10:00 AM on any weekday you wish and have trouble finding someone to fix a flat on Route17. Primarily because route 17 is in New York State not Vermont. Fortunately the Colonel doesn't dispatch me.

Ahh Willy, could you use some remedial map reading or something? And so what if 17 is a whole twenty miles South. I simply typed South, so what's the hair splitting about? Are you one of the type that wont run for 50% of two buks, but would run yer azz off for 60% of a buk n half?

 

[chefdennis]

Mark, While I am one that most often will tell anyone that ask if this business is a good deal, that if they set themselves up right financially from the start, if they work hard and smart and are a quick study, they can make it...now that being said, that information is given to those that will be Owner Operators...not owners looking to put someone in a truck...

As has been pointed out, you seem to be looking for people here to re-enforce what your buddy has told you....that ain't going to happen, as you have seen.....There is a world of difference then ownong and driving your own truck instead of owning and putting a team in that truck.....

Now what i am about to say is NOT meant to tell you to get lost at all, the people here have given you sound advise on many levels..RLents question as to what you might do when a team abandons your truck on the opposite coast that you are on is realistic and needs to be considered....that being said, with all that you have been told here that doesn't seem to sit well with you, you might consider googling a few other trucking sites...there is another Expediters site and more then a few good general trucking forms...try them out, and ask the same thing you have here...chances are overwelmingly good that you will hear the same things that have been offered up here...

So..all of that being said, I'll say this, if you are prepared to lose your investment and maybe your home (using your home to put this deal together is just plain nuts) and possibly more, then go for it....life is full of pitfalls, i have ventured in more then my share of business deals and lost my tail on a few of them.....so if you really feel you can beat the odds, and that you and your partener can make a go of this with no experience along with drivers that have little to know experience ( i am pretty sure that you said you wanted to use a team that was in the same position as you and your partener, and do you realize how long it takes to learn this business and learn how your carrier does business??) then you really don't need the information that is being given to you here, you seem to put all of your stock in your friends business, so go for it...just stay in touch here so we can follow your devolopment...there is nothing better then making us here eat humble pie.....

One more thing, while you are not looking at using a sprinter, here is a link that should be required reading for anyone thinking of entering this or for that matter any business....What would happen it you had an accident that took your truck down for 5 months!?!? Could you deal with that!?!?

http://www.expeditersonline.com/for...omething-newbies-think-about-tjps-trials.html

 

[roadeyes]

Ask your buddy with the four trucks how he started out in the business.

I could be wrong, but would be willing to bet that if he didn't start out driving for someone else, he at least drove his own truck first to learn the business before becoming a fleet owner.

I think you should be willing to do the same, but if you are looking at it as strictly an investment and want to continue with your professional career, then get somebody who is already in the fleet management business to manage it for you instead.

I believe that you either have to be completly hands on or completly hands off, there is no in-between!


And to reiterate what others have said - under no circumstances should you ever refinance your home for something like this!!!

 

[greg334]

Cheri,
Yep there was a change but I still am a competitor for the same freight that others want.

 

[davekc]

Well.....after 75 responses, not one supports the idea that has been presented. One could write a book on why this is a bad deal.
The folks here at EO aren't just the "party of no". It is how you are trying to do it that is the real issue.
Putting ones house on the line for a depreciating asset is another sign of a casualty in waiting.
I also believe that too much stock is being put forth in this fleet owners advice. Maybe, just maybe he is the other investor.
Not a good sign if that is the case. Just speculation.

Why? Because you are making the claim that reefer trucks get the same regardless of the run. That is simply not factual.
Let me give you a reality check that this owner isn't giving you.
If a load is booked at a reefer rate, you would be awarded that load at your contracted rate. If a surface load is offered, they will offer it to you at a discounted rate. Especially if there are other trucks in the area. Why pay you more if they don't have to?
Same issue if they book a load at 1.70 and your rate is per mile is 1.60. Do you think for a minute they will send that to you verses a truck sitting next to your that is 1.35?
It is not going to happen.
I wouldn't even recommend looking at this owners books until you actually know what the numbers mean. That is much different than what he says they represent.

Hopefully this thread will help others looking to enter in this fashion.
As the saying goes, "you have been warned".

 

[markwilson]

alright. points all well taken.

but. . .

if we do still want to do this, after a day of reflection and looking at the responses i have formulated a short summary of things we need to do before 'pulling the trigger'. . .of course, there are probably dozens more.

1)get financing in order (which has already been done). decide on 5% rate with house (obviously frowned upon here) or around 6% without the house on the line.

2) legal/insurance-- coordinate with attorney with knowledge in trucking/transportation industry, likely forming llc. discuss previously mentioned worst-case scenarios and prepare for those. also, have attorney pore through any insurance documents and carrier contracts to negate any chance of personal asset loss.

3) the guy with four trucks is not the other investor, but look over his body of work.

4) truck. decide on either a good used truck (preferably which has had its 600k overhaul) or a new cab and used component parts. also research viability of t-val, refrigerated unit vs. dry bed.

5) driving teams-- understanding this to be the most vital component of the entire operation, learn means to find and retain good husband/wife driving teams.

6) learn the system-- with understanding that there will be bumps and bruises in the 'learning curve' period, act upon 1-5 and buy first truck. use first 3-6 months to learn as problems arise, then see if project is viable. if so, repeat and build fleet.

 

[highway star]

1)get financing in order (which has already been done). decide on 5% rate with house (obviously frowned upon here) or around 6% without the house on the line.

The way this reads, it sounds like you're saying one point is worth using your house.

LOL... C'mon... Really??

If you can get a truck for 6% that's an excellent rate.

Also, 600,000 would be an early overhaul on a class 8 truck.

 

[greg334]

1)get financing in order (which has already been done). decide on 5% rate with house (obviously frowned upon here) or around 6% without the house on the line.

RULE NUMBER ONE - DO NOT USE COLLATERAL THAT YOU CAN NOT AFFORD TO LOSE.

Using real property in a venture that has a higher risk than normal coupled with an inexperience will cause you to lose more than you may be able to handle.

2) legal/insurance-- coordinate with attorney with knowledge in trucking/transportation industry, likely forming llc. discuss previously mentioned worst-case scenarios and prepare for those. also, have attorney pore through any insurance documents and carrier contracts to negate any chance of personal asset loss.

You do not need a lawyer with transportation experience, you need one who can advise you based on your present situation and one that can guide you in forming a protective entity. When you are ready to form that contract, a good lawyer can write up a good contract within the FMCSA and state regulations without any difficulty. They will also advice you on your liabilities when hiring a sub-contractor.

3) the guy with four trucks is not the other investor, but look over his body of work.

I don't get this one, look over what?

4) truck. decide on either a good used truck (preferably which has had its 600k overhaul) or a new cab and used component parts. also research viability of t-val, refrigerated unit vs. dry bed.

OK I think this makes no sense.

Used truck, follow the used truck buying procedures. Mileage is important to a point but so is the history.

A new cab with used components? DO you mean a new truck with used box and maybe a sleeper?

Here is the problem with researching the viability of a 'tval' reefer vs. a dry box truck. Unless you get to know the business and learn the actual costs, then all you will see are number IF you can get those from anyone. MANY owners will not share numbers with people and if you expect honesty from the company - forget that.

I am one of the open honest ones out there and even then I won't talk about a few things. I know another who will tell you the truth about how much they make but he will also keep close a few key points.

The issue with reefers is not the money you make, it is the cost to keep them running. Many have been lucky, a few too lucky but when that little engine craps out on you for no reason and you are say on I10 headed out of Texas into New Mexico for a rush delivery in Arizona, you do not have time to ask the company to see if they can help out or get it on another truck, that is a lost load.

5) driving teams-- understanding this to be the most vital component of the entire operation, learn means to find and retain good husband/wife driving teams.

Not really. Learn means to know how to handle people. If you ever did any hiring, it will not be an issue but if you never did, you have another learning curve to approach. The real problem with this industry is it is too easy to get into from the drivers point. Anyone can get a license, I met some who can't figure out air pressure in tires and even a few who can't check oil. Even if you teach them, they may be dumb enough to forget - 'it is the yellow thing that says O I L in it, understand this time?'

6) learn the system-- with understanding that there will be bumps and bruises in the 'learning curve' period, act upon 1-5 and buy first truck. use first 3-6 months to learn as problems arise, then see if project is viable. if so, repeat and build fleet.

BUT see you need to read this carefully and think about it.

Learn which system?

What I mean is this, every company is different, every situation is different. There are common threads among companies and among the industry but overall everything is different.

If you are with panther, then you have to learn what panther does and how it affects you. YOU can not learn that while sitting behind a desk but actually have to get out and learn it while working. This is VERY important if you expect to be able to handle people who are working for you. Without the experience of doing something on your own, you can give an image that you don't care or that you don't want to be involved. I know of one owner who for every little thing, he passes it to the company and they deal with it, his turnover of drivers is high despite his paying 75% of the line haul.

If you want to learn the industry and the niche market, then it will be another layer of learning on top of that. This is a problem because it is actually hard to learn again unless you are on your own.

Now Mark, I have a few questions for you.

1 - what is your background. Do you hold a finance degree or have you owned any businesses with employees in the past?

2 - how old are you?

3 - did you do a risk assessment for this niche market?

4 - have you talked to any company passed the recruiters?

5 - have you spent time in a truck of any sort?

6 - do you have a business plan and has that business plan been presented to anyone outside of your 'circle' like maybe a SCORE member?

 

[markwilson]

thanks greg. yes, we are sorely inexperienced. have never driven a truck and never plan to, but do own a beautifully rusting 1972 Volkswagen Bus. i and my partner are 35 years old. we both have good solid full-time jobs, but despise the grind.

so, in your opinion, besides forming an LLC, what are some other things we can do to further protect the entity and not lose the equities in the trucks given a doomsday scenario?