CRST Malone - can this be right?

[MoonlightGraham]

Was flipping thru one of those free trucker magazines when I came across an ad from CRST Malone for owner operators. The average loaded rate they were touting was $1.77 per loaded mile plus $0.28 per mile fuel surcharge (as of Feb 07). Their website (http://www.malonecontractors.com/contractor.html) also makes this claim.

This adds up to $2.05 per loaded mile for o/o leased to them. Seems way too good to be true, especially if you assume they are covering cargo/liability insurance and base plates.

I doubt many with own authority are averaging $2.05/loaded mile.

I know Gman used to run for CRST and has mostly good things to say about them.

I am looking to buy my own truck one day soon and had planned on getting my own authority. But at these rates, why bother with all the paperwork? No cargo/liability insurance, no IRP, no IFTA reports, and no billing and cashflow problems.

What's the catch here? What am I missing? Any input would be appreciated.

BTW, I spend a lot of time reading posts on this forum and have learned a great deal from all of you. I rarely post because, well, I rarely have anything intelligent to say... Do have a lot of dumb questions, though...

Thanks

[Maniac]

What am I missing?

That $1.77 is GROSS revenue, you would get a percentage of that like 75%

That would make it $1.32 or so plus the surcharge, that would make it $1.60 a LOADED mile, factor in some deadhead, and you will be lucky to CLEAR $1.30 or so for all miles.

[Red Clay Rambler]

I saw the same thing and thought it might be a misprint. I assumed that rate included the FSC. I think they charge for use of their base plate. They also charge for trailer rental if you don't use your own as most flatbed companies do.

My conversation with one of their recruiters was straightforward, no hype/pressure/sales tactics and no mention to me of lease/purchase. They also told me they offer health insurance through them at very competitive rates, not sure if spouse/family coverage is also available.

[Dispatch_This]

I believe that it's 1.77 per loaded mile GROSS. What you need to find out is what percentage of 1.77/mi is being paid to the truck, and how much deadhead (on average) there will be. You will probably discover that what the truck actually nets is about the same as what other carriers are paying.

[rank]

I doubt many with own authority are averaging $2.05/loaded mile.

$4.21/loaded mile for September. 9 loads for $11,588 on 2750 miles.

:wink:

[solo379]

$4.21/loaded mile for September. 9 loads for $11,588 on 2750 miles.

But that's not your "average"? Is it? :P

[mudpuddle]

I believe Rank also does short mileage cross border loads so his loaded CPM will naturallybe higher than someone doing longer loads in the lower 48.

[GMAN]

The ad you quote is most likely the gross rate before CRST Malone gets their cut. They pay 75% of the rate and 100% of the fsc. When I leased to them, I averaged $1.66 for ALL miles including deadhead. I kept my deadhead miles at slightly less than 10%. At the time I was there I believe my rate was a little higher than some others. A friend of mine recently got his authority after being leased to them. At one point he was averaging about $2/mile including fsc, but was running shorter runs and getting home every weekend. You furnish your own trailer or can rent one of theirs. The owner operator also furnishes his own base plate, but they will pay for them and take a set amount out of each weekly settlement. It is cheaper to get your own. Like any percentage carrier, they have good and poor paying loads. I don't recall seeing too many really cheap loads, but I know some agents had them. I simply refused to haul them. That is your option when you lease to CRST Malone or any of the other percentage carriers. It is up to you to find the good traffic lanes and the better paying loads.

[rank]

But that's not your "average"? Is it?

It was my average for Sept
Previous months averages were:
3.51, 3.09, 4.08, 3.31, 2.44, 3.19, 2.12, 4.45, 2.11, 2.26

I believe Rank also does short mileage cross border loads...

yeah. 9 backhauls in Sept for 2750 loaded miles = 305 mile average. Pretty short. All cross border. It's not exactly apples to apples.

[Hiway61]

Not to 'jack the thread too far, but if one is an O/O, leased to a a carrier, that they still locate and own loads and get a cut of the 25% that would normally go to the carrier?
(Hmmm bit confusing, can't think of a way to make it simpler --- just looking for the best of both worlds, I guess.) :?:
Again .. my thanks to those who help out N00bs here.

[GMAN]

With agent based carriers such as CRST Malone, you can find your own loads by contacting their agents. You are still assigned a dispatcher with CRST Malone, but not all agent based carriers have a dispatcher. The dispatcher will keep you loaded, but you can sometimes do better finding your own loads. That is what I did when I leased to CRST Malone. I was proactive in finding those agents who had the better paying loads. I had a similar situation with Landstar except that Landstar doesn't have dispatchers at all. You must find your own loads. With any carrier, you are not giving up 25% for them to just find loads for you. The carrier who leases owner operators to them must also make sure that the owner operator is operating with the hos rules, plus pay cargo and liability insurance for each owner operator. Each owner operator must be enrolled in a random drug screen program. The carrier must also make sure the owner operator has the correct permits. Compliance and insurance are probably the two most expensive aspect of a carrier leasing on owner operators. The 25% is not all profit. Insurance alone is a major expense the carrier must bear. I have known of those with their own authority who have gone back to leasing to another carrier and done about as well as when they were on their own. Some are doing better leased. With a carrier such as CRST Malone you have the best of both worlds. You have a dispatcher, but can also find your own loads. I am not necessarily endorsing them or any other carrier. When you run on percentage, it is up to you to make the final decision about a load. Only you can decide whether a load pays enough to haul. The carrier's expenses are pretty much fixed. The guy who owns the truck has variable expenses whick may make a load unprofitable.