Costs are more easily contained in a lease situation and rates on the spot market don't respond to fuel spikes nearly as well or as fast as contracted freight, which is what the bulk of the freight with the big carriers is. The spot market is the place to be when demand is outstripping supply. While this winter is better than the last few, it's still slow compared to the rest of the year and the supply/demand ratio isn't terribly favorable. That will change in a couple of months; how much remains to be seen. There are pros to both sides. Your risk tolerance and outlook on freight over the next year should be your driving factors in which choice you make...only you can answer that.
I've got a few friends running their own authority. The ones doing well have about half their freight on contract and only rely on the spot market to fill in the holes. Of the ones that operate exclusively in the spot market, they are sweating it and a few are looking at a lease situation. That's been my recommendation. Not that it can't be done, but this cost environment (Bridgestone just announced a 12% price increase) is not the time to be learning the ropes and searching for core freight. |
Alright lease situation is definitely what I'm looking for. Safer and more secure. Is there a lease company out there that is better than CRST and or LS though ?
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Starting out with no experience, leasing would be much easier to work with than running your authority. There are other carriers that might lease you on. Mercer, Bennett, ATS are some who use flats and step decks.
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Just love these guys that come up with all the spread sheets that show they can make money right off the bat with trucking :) and not even doing it them self's ! When I first got my heavy hauler my little truck (w900L 600 cat with 86' sleeper and 3 axle step Doonan) sat for 6 months or so as I couldn't get a good price for it. Finally a driver talked me into leasing it to LS and to letting him drive. Worst mistake I made !! He was a good driver and would take anything I said to haul to keep running BUT LS has a quasa seniority system ! If you call a agent empty in an area on a load he has listed he will hmmm and haaa if the shipper is going to ship or I don't know if it will go and 'I'll call you back' then you will find (talking around) that an 'older guy' got the load the next day but 'I do have this other load that pays fuel to move you to a better area'. If it hadn't of been for my heavy hauler I wouldn't have been able to keep up with oil changes on the little truck. Seems like with LS, when you are new, the fist two weeks of the month you run good then sit the next two weeks. Is it something in their computer system ??
There are so many hidden excpenses that no one figure in, tarping a load in winter you will break 6 or 7 rubbers X 3 or 4 loads in a row =$20, tearing up a tarp = $400+, ripping a strap = $25, tire damage = $450, lose a chain or binder = $30 + and on and on and on. For someone who has never been in O/O part of trucking stay out of it unless you are going to do it yourself , or have at least a years worth of $$$$ to underwrite it |
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nice planning. hope it works.
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In my opinion you would make more money just getting a job as a dispatcher for $10-12 per hour than leasing a truck on at one of these carriers. Getting your own authority and seeking out your own customers is the only way I can see making your situation work.(the guy from Miami comes to mind but I don't recall his name, now he has 10 or 12 trucks hauling flowers or something)
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I'm having a change of heart, I was going to do my O/O operation as outlined in the forum under "start up cost", but have come to realize it will be a much better situation if I am able to be the driver, that way I cut cost of driver, and have full control of my destiny. So with that being said, I am going to sign on with a company and get a least 6 months to a year experience first. As required under LS and CRST Malone requirements.( requirements for LS experience: 1 yr exp. within past 3yrs including snow and ice, And 6 month within last 4 yrs. with equipment applying to pull) My problem is that when I do finally switch over to o/o I want to pull flatbed or step deck as it tends to pays a lot more. Well, I live in Tampa,FL. and there is no flat bed companies wanting to hire and train in flats or step. So i found maverick and Boyd Bros. Trans. They will both train in flat/step but not in my area, would have to relocate to Tennessee, Alabama, or Georgia which really isn't an option for me.
And just in case I haven't stated before , I have had my CDL 4 yrs now but didn't use it at all after school because my wife was expecting our third child and I didn't want to leave her in the middle of it. so I put everything on the back burner for a later date. Well the date has come and I was able to get a couple of tractor and trailer loans because I have had my CDL for more than 2 years, which is what the bank requires and also insurance no matter if I have been driving or not. My credit score and current income may have a little to do with it as well, but mainly because I have had CDL for 2 yrs. As I have outlined in forum under ( start up cost). I basically can buy truck/trailer but can't drive it for any company leased on because I don't have the experience. Unless I get my own Authority. That's to risky... I do have driver with 25yrs exp. that would probably be accepted at LS and CRST, but he mainly wants to stay in southern states and I can't promise him that, because I will go where ever the acceptable rate takes me. And southern states don't pay as much as others, unless u have a contract freight direct from dist. So i started searching again and found two more companies that hire out of Florida, but with van freight. They both have great foundation, pay, and have separate division for flatbed where I may be able to transfer over over time. The companies are, Roehl Trans. and Pam Trans. with Roehl being my number one choice right now. They just want me to get refresher course, which isn't a problem at all. And then go to Orientation in Ellenwood ,GA. for 8 days, they pay me 300 bucks (part of bonus) after 8 days, then I go out with Trainer for 13 days at 90 bucks a day. and then at end of that I get another 300 bucks ( totals 600 bonus). After I'm done with 13 days they send me home with tractor/trailer and I'm on my own. Total time in orientation/ Training 21 days and 1770.00 dollars pay. Then .30 cpm for 3 months .32 3-6 months and .35 6-12 months. Of which at 6 months I can then switch over to either flatbed division, or 1 yr O/O with them. Ive literally checked every company out of Florida and this the best I could find. All the rest were at either at .22 mile, or making you train for peanuts for 6 weeks, or training you and putting you under contract for a year, ect..BS. I have a goal to achieve, and if I can make descent money while I working towards that goal that would be awesome. I know .30 or .32 cents (700-800 bucks) is anything to brag about, but I guess you sometimes have to take two steps backwards in order to take 5 steps forward in the future. Anyways if any of you guy's have any suggestions please fill me in. |
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