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Originally Posted by Andie
Hi All,
My husband bought a Pete this summer for short money and has rebuilt the engine and brought the truck back to life. In the meantime, I've been getting smart on what paperwork we need to file to get him on the road. Hes not computer literate at all and the task has fallen on me to research the registration and insurance process. We didn't anticipate it being so costly before we could even hit the road to make money. Our current status is that it is registered IRP with just our state of residence and a neighboring state, and minimum insurance to have it registered. We have a DOT # but not the authority yet, as we do not yet know what he will be hauling and don't want to pay $300 each authority. Bills are adding up quick. But we're not too far into it that we can't recoup. All in all we're in about $15,000 using our personal savings, an interest free credit card, and borrowing from family (He paid $5K for the truck and about 10k in parts). I'm sure we could sell the truck for at least this and pay off our debts and he can go back to being a company driver. But I know if we back off now we'll regret it. He's so happy and proud of this truck. What I want to know is, Is the money as an O/O really worth it all? Is he really going to have the freedom to be home more? He keeps reassuring me that the business is "big money in, big money out." But right now all I'm seeing is big money out and I'm scared. Whats your take on our situation? Should I stand by my man and see this through, or should we get out and run as fast as we can?
If you run your own authority it helps to have some computer savvy. If you run interstate you will need federal authority which costs $300. That is a one time filing fee. Some states offer intrastate authority, but to my knowledge none charge as much as federal authority. Two of the most expensive are California and Texas. I believe that California is $150 and Texas is $200. You don't need intrastate authority for most states. Intrastate authority is where you pick up and deliver the same load in the same state. No matter what you haul, if you cross state lines you will need interstate authority which is the $300. Unless you haul hazmat you don't need any additional authority starting out. I would suggest staying away from hazmat due to the high costs for a single truck operation. There are also other compliance issues which you may not want to have to deal with starting out. All you need is $300, registered agents and insurance.
In any case, if you decide to get your authority you will need $1 million liability and $100,000 cargo as a minimum. Costs can vary widely, so I suggest you check around should you decide to pursue getting authority.
Your husband could lease to another carrier for a while and that would be a good way to put some money back, pay back those whom you have borrowed to get to this point and start with a clean slate. It sounds like your husband bought an older truck. Some carriers have age restrictions. Others only require that the truck looks decent and can pass a DOT inspection. If you want to get a taste of how it would be to run your authority an agent based carrier such as Landstar would be a good place to start.
Most of us who run our authority have our own trailer. If you lease to a carrier you won't necessarily need to purchase a trailer, depending on the carrier and type of freight he wants to haul. As far as the big money is concerned, you won't get rich but you can earn a good living. There are so many variables when it comes to running a truck. Some do well and others fail miserably. This is a very unforgiving business. The failure rate is high. You are starting out with lower debt than some whom I have spoken over the years. If you are frugal with your money and get with a good carrier then you could do well as an owner operator. It would also require less money going in. Some carriers furnish base plates and permits. Others will front the money and take a specified amount out each week. If you run your authority you will need to front the costs for all those things yourself. You will also need to have the money to front for fuel and running expenses until your money begins to come in if you run your authority.
There is a little more paperwork running your own authority. Personally, I think that it is good for some people to start by leasing to a carrier before getting their authority. It makes for a good bridge.
It is critical for a driver or owner operator to have the support of his family. It can be taxing on a relationship with this type of lifestyle. There are no guarantees of being able to get home more frequently than he can as a company driver unless he wants to do a lot of deadheading. I have a friend who runs his own authority and he manages to get home almost every weekend. I know others who find it difficult to get home more than every 2 weeks. It all depends on the freight and what rate you are willing to haul freight. You can sometimes get lucky and get something that will take you through the house. Other times it becomes more challenging. Things do go much more smoothly when an owner operator has the support at home.
He can lease to a carrier in a matter of days and be making money within a week or so. If you apply for authority it will be several weeks before you can get your authority back. You have come this far, you may as well see it through. You will never know whether you can be successful at something until you try. Since you have invested in a truck I would give it a try. He needs to decide what type of freight he wants to haul. Most carriers pull vans. He could pull a reefer or flat bed. Most carriers who pull vans furnish the trailers. Some carriers who pull flats will want you to either have your own trailer or rent one of their's. Leasing to another carrier would be the fastest way to start getting money back in. It would also give you more time to research what you want to do.
There are no guarantee's. Life is a gamble. When you start a new business venture there is no way to tell whether that business is going to be a success or not. Sometimes, not trying is worse than trying and failing. I would suggest that you give him all your support and encouragement. I have been in business most of my life. When my wife and I were first married she was scared due to my being in business. She had always been used to those in her family receiving a guaranteed salary. You won't necessarily have that when you are in business, especially starting out. My wife has obviously changed her attitude. She has seen that the money will come in as long as I work. It may vary somewhat from one week to another, but she has become much more comfortable with it over the years. In fact, I don't think that she would want me to work for someone else at this point. She understands that I can make more working for myself than I would working for someone else. To be honest that isn't always the case with everyone. You must treat this as a job or business. The money will not come unless you put forth the effort. As long as you work at it the money should come.