Considering buying a truck. LOTS of questions.
 

Hey O/O's I'm considering purchasing a truck next year and have a few questions. I am currently a business owner NOW and know how to successfully run a business and I've also driven for TMC flatbed for a year. I LIKE driving OTR but want a little more freedom. My questions are as follows:

1- Better to Lease or Own?

2- As an O/O, is one free to choose his freight and how hard (or easy) one runs?

3- If you agree to haul freight for one company, for example TMC, are you limited to working ONLY for them?

4- What is the APPROXIMATE typical income average for an O/O after expenses?

That's it for now. I'm sure I'll have more and/or those replying will enlighten me to stuff I've never even considered. Thanks for looking.

Re: Considering buying a truck. LOTS of questions.
 

Own. Leasing is a last resort. If you lease because of bad credit, do not get suckered into those "revolving leases".

Totally depends on the company. Generally if you pay the insurance, there is no forced dispatch. Percentage companies usually have more of an open concept.

If you're under their authority and insurance, yes.

This REALLY depends. Depends on the company, what you haul, how hard you work, and how much you can keep costs down.

If you do everything right, 70k-80k is easy after the truck is paid off. More is definitely not out of the question.

I agree with Allan. It is better to buy a truck than lease. If you decide to lease a truck find an independent leasing company rather than leasing a truck from your carrier. You will almost always make more money running on percentage than mileage. Most percentage carriers are non-forced dispatch. If you want to sit for a few days or take some time off they usually won't mess with you. If you want to haul loads for other brokers or carriers it would be best to get your own authority. You could then do as you wish. Some carriers will allow owner operators to book loads outside of their internal dispatch but you will likely have the same deal on the money. Most flat bed carriers will require you to either rent or purchase a trailer. Some will rent you a trailer for about $165/wk. In addition, you will also need to purchase tarps, binders, etc., I would expect to spend around $2,500 for new equipment. You may find used for much less.

PLEASE forgive me if I sound stupid as I've only been a company driver thus far, but what exactly IS "your own authority? Or is there a thread on here I should read explaining it? Does it mean just getting your own insurance and plates/permits?
I can see I have a LOT to read up on before jumping in yes?

Re: Considering buying a truck. LOTS of questions.
 

He is better be! Or he could have problem with IRS on his "status"!
The only criteria for me, is "how hard i want, or need to"!

As of to "income" question, anywhere from 0 to a 100 grand, sounds reasonable! :wink:

All motor carriers must have motor carrier authority to operate. There are two types of authority, common and contract. It is my understanding that the Feds no longer make a distinction between the two. Common is probably the most widely used. Most motor carriers will have common authority. If you cross state lines you are required to have interstate authority. Interstate authority costs $300. To be issued authority you must file an application with the feds, have registered agents in each state in which you operate and have minimum amounts of liability and cargo insurance. You will need authority before you will be allowed to purchase your base plates and permits. It usually takes a few weeks to get your authority back once you apply. It is difficult and expensive to obtain insurance until you have at least 2 years experience. Some states require intrastate authority to pick up and deliver within their state. The two largest are Texas and California. You don't need intrastate authority unless you pick up and deliver within those states which require intrastate authority.

Does local work qualify towards the 2 year experience request or must it be OTR?
So similar to getting plates for a car you need A) insurance and additionally B) Common intrastate authority if you want to run the 48 states?
What are registered agents in each state? Do you mean shippers or insurance agents or ?
That $300.00 cost is weekly, monthly, or yearly?
Thanks so much G-man and the rest of you!

You need Common Authority. $300 one time fee. You can go to FMCSA to apply online. They have simple instructions on what you need.
You need interstate for 48 states. Intrastate for one state.
You need a US Dot#. You can get it also at the same time you apply for Authority on FMCSA website. They will also explain insurance requirements.
You need to register with the new UCR registration system. Simple, look them up online.
Registered agents are BOC-3 process agents which you can have OOIDA handle for you, for a small fee. These are required to obtain your authority. Worth it.
You need to file with IFTA if you go interstate. Fuel tax based on miles driven in each state during the course of the year. First year is estimated.
NY State HUT. Highway use tax for NYS. Must file if you drive in NY, even if not in NY you must have to drive in NY.
2290 heavy use tax. Once a year tax paid to the IRS. Price depends on weight. Generally $550 a year.
1 mil General and auto liability insurance, 100 thousand cargo.
Some companies will accept local experience, some won't.
There are also other permits needed for certain states like KY and OR, some other mabye also needed that others might know.
I think I got most of it, but I might have missed something. I'm sure I did.

Sounds pretty easy actually.

I should get my own authority and everything.

How long does it take generally to get everything in order?

thanks sidman! :wink:

I think a LOT of guys who are great workers as company drivers and have it in their blood to do this job are very fearful to become an O/O. I know I am. Ignorance fuels my fear and I hope this thread enlightens me (and maybe others) on what's really involved being an O/O.

When I finally did mine it took about 4 weeks total, start to finish including IRP plates with cab card. I had a service do my IRP registration.
I had my paperwork 3 quarters of the way filled out and decided to let the service finish. IFTA is like $8 bucks and a form to fill out. Comes back in about 3 weeks. The service wanted $60 to do my IFTA, I said no thank you, I'll send my $8 dollar check and do it myself. Most things you can do yourself. Only reason I had my IRP done by a service is I did not want to go to Albany, NY and get turned down because I forgot some piece of paper. To me that is the only service worth paying for.

It took me 4 weeks. I live in Tx. Your Mc number will be issued in just 2 days. That is when you need to buy insurance right away so that it will stay on file with FMSCA for 16 business days and tha your authority will be active. During this time while waiting you can apply for your plates,UCR,and IFTA. In Tx IFTA takes 2 weeks and they don't allow walkins. Also make sure you take a drug test and have a safety program in place. You will get TONS of phone calls when your Mc number is issued offering this service for 100.00 a year. It is well worth it. All in all,everything falls in place in 4 weeks and you will be ready to hunt and devour. :lol:

If you call their satellite office they will tell you exactly what you need to bring to get your IRP. I had to fax everything and order mine by phone and wait till the next day to go pick it up. This is in Tx though.

Goldie if you decide to buy a truck, come back here and I can give you some good advice. Right now fuel mileage is king, fuel costs more then everything else combined.

I can find a used truck that should get 7.5 mpg driven at 60 mph. Maybe even better.

Thanks sid, DD and Allan

Most carriers don't count local work as otr experience. If you get your authority they primarily check to see how long you have had your CDL. Mine also asks for a list of former employers for my drivers.

You need liability and cargo insurance before authority will be issued. You will also need proof of insurance before most states will sell you base plates. Intrastate authority is for running within some states. However, not all states require intrastate authority. For instance, California requires intrastate authority for load picking up and delivering within California. You don't need intrastate authority if you either pickup or deliver but not both within the state. If you only run within a state which has intrastate authority, you don't need interstate authority. There are some running their authority who only run California or Texas. Because of their size, it is easier to do in those states. If you run interstate or between more than one state, you will need interstate authority which is issued by the Feds.



Registered agent are people who can accept service in your behalf if someone should file a civil action against you. OOIDA used to do this at no charge for members.

Someone else has already answered the $300.00 fee question. You are welcome. We are glad to help.

You can either pay a service to do the filings for you or do it yourself. I did mine myself. And my state doesn't charge for IFTA. I only pay at the end of the quarter, depending on how well I purchase my fuel.

GMAN, "You 'da man!"

Goldie start doing searches on all this stuff and also cost breakdowns, that's been discussed a lot on here. There's a whole lot of info to read up on. Also OOIDA website has a cost breakdown spreadsheet that you can download. If you don't like that one I have another one I can email you. (courtesy of geoman)

OOIDA, on the left side of the screen click on trucking tools, it's in there. "Cost per mile spreadsheet."

If you do the authority process yourself what kind of expenses are these fee's n paperwork ""not"" counting your plates n permits n insurance costs ??? The reason I'm asking is because I keep seeing the places offering to do this but they want from 500 to 1000$ for this and that does'nt count the other stuff ??

Like we said earlier, $300 bucks. That includes Authority. US DOT# is free. UCR (Unified Carrier Registration) this replace's SSR, is $39 dollars for 1 truck. That's it. You did say without permits and insurance.
But anyway, HUT is like $8 bucks, and so is IFTA. 2290 as mentioned earlier is $550 for 80,000 gross weight. That one goes to IRS.
It is really easy to do online. (get your authority, that is) Just make sure your ready, because you must have insurance within a certain amount of time or you will loose authority. If you decide to get authority, all the phone calls will come in offering services for saftey audits and drug testing. Be leary of all services, they will try to sound like they are the DOT but they are just companies charging a fee for the services mentioned. You will need to shop around for a good price for a service if this is what you decide to do. OOIDA has many services for cheaper then most. Joining a drug consordium (this is required for carriers) they offer a decent rate for members. Also like G-man said, the Boc-3 process agents they file free for members. I said they charged a small fee, but I forgot it was for free for members. After doing the process, I would definitely recomend doing it yourself. Very easy. Even Pepe can do it. :P

:lol: :lol:

You can do the entire process on line with a credit card. All you need do is go to the fmcra website, fill out the application for authority, pay your $300 filing fee and you are on your way. That is all these services do. While you wait for your authority to be processed and mailed to you, it is a good idea to go ahead and get your process agents set up as well as your insurance. I would not start paying premiums until you get notification from the Feds that your authority has been granted. If you don't want to join OOIDA and get them to file your registered agents there are services you can pay to do it. I have seen some that charge about $35/yr. OOIDA membership costs $45 and they do it for free.

Keep the info comming! I'm getting PSYCHED! This sounds like a small challenge and I love challenges. When all is said and done, I believe I'll feel like I've really accomplished something!

Hi Goldie,

The other guys have covered the authority topic pretty well so I'll chime in with the money part if I may. I always say you need $100,000 to start up. I think you an expect to earn $30,000 after expenses and before income tax. you can borrow a portion of the 100,000 of course but the finance charges will come out of your pre tax profit.

IIRC you are in the NJ area and you like your home time. This can work in your favour because nobody likes to go into NJ, NYC and Long Island. Rates are above average here. If you operate within 500 miles of NJ, I'll wager you can get over $2/loaded mile with a step throughout the spring, summer and fall. You should be able to figure your income from there.

From what I've seen you would do well to have two or even 3 trailers. Flat or step in the summer and a reefer/van in the winter. I don't know anything about reefers and vans but I get the general impression that they are both getting higher rates than decks right now.

If you can't afford multiple trailers (understandably), then buy a deck in the spring of the year and budget to take the winter off. It's not worth running for peanuts in the winter. And forget running south....there's no money in that.

Hope this helps.

Coming in-yes! But coming out, is a different story! :sad:
The good thing;-you wouldn't be sitting in a some s$it hole truck stop, looking for the freight. You'll be home... :wink:

Fred,

All this Authority stuff is if you want to be on your own. If you lease onto someone such as TMC, Steve or Pepe, then a lot of this isn't needed.

You can also wimp out like I did and go onto www.dotauthority.com. Click away on the menu, give a credit card number and have everything you need done in less than 10 minutes.

If you are a OOIDa member they will charge only 150.00 to do all the authority process AND they will take care of your BOC3 form. Just don't go with their insurance since several shippers will not accept it.

you can keep any truck loaded year round with a good rate if your willing to do your homework and run.


when i`m out I run every available minute I can as hard as I can, its a job not a holiday my theory is why dick around and take my time when I can run harder and make more money but I dont stay out for weeks at a time because i`ve got myself a little niche market in the oil and gas industry hauling generators and drill pipe and whatever else they can strap on me and keep under 100k, yeah I had some connections in the industry but i`ve sent alot of guys who knew nobody to companies and they`ve gotten loaded just fine.


when I first started out I wasn`t in steves boat I had I think 8k in the bank and a paid off truck I spent a few years building so I had to run alot and maybe I hauled some shit freight but I got money to start coming in and I started making more connections then I had from being a mechanic, I learned who not to run for where freight was dead what areas paid killer money to run into and nothing to get out etc


the point of my babbling is do your homework and you`ll be fine.

Steve what did that cost you to do it that way ??? I'm talking as far as fee's for their service.

Thank you GMAN

We should just make a FAQ of this at the top of the page. Each step you need, and links/phone numbers for each step.

Even simple stuff like figuring out fuel mileage over a month, etc..

I don't remember what their fee was but you can go on the website and get the figures. I applied for everything and it was I think $600 total.

You can do it on your own but with dotauthority is a luxury and one stop shopping and it's done within minutes.

Thank you Steve

I think that would be better for me. I was going to use OOIDA but I need to see if I'm going to stay there or not before I get involved with it. I won't be doing anything with this until next Feb or so anyway.

I here's a link to a site that advertises getting your authority for $399 including BOC filing. Dont have any experience with them.

http://www.tagpartnerssystem.com/pricelist.html

Ummm Goldie...if I may be blunt, you may know a lot about running a buiz in general, more then me Im sure, but from your questions you dont sound ready for a trucking business quite yet, learn a little more about the trucking business in general before such a huge investment.

More Info is good....Gman n many others advice here is golden. You are a, or have been a Co trucking employee?...If so keep your ears wide open n pick up all the tid-bits you can there b4 you make the jump.

very well said Pepster,I worked as a company driver for 8-9 yrs before I bought my truck,was very beneficical making some of those mistakes on others peoples dime.

I think Goldie's drove for TMC and was an informal recruiter for them also, per his posts on another forum.

I would suggest leasing to a carrier for awhile before getting own authority, based on some of his questions, like Pepe said. All the paperwork and load-finding associated with having your own authority can be overwhelming at first to some. Steve Booth, Pepe, and some others here started with their own authority, but it sounds like they don't have alot of domestic responsibilites, family at home, etc. to juggle while they are learning, so they can concentrate almost completely on their new business without family "distractions". (ya'll correct me if I'm wrong)

It is a big jump going from a company driver to your own authority. It is an even bigger jump when you go from having little or no driving experience to running your own authority. Going into business is a challenge at any time. The more knowledge and experience you have going into business the better. Grit, determination and money can over come a lot of obstacles. :wink: