Hello all, and thanks for many great comments on Ray’s rules, I plan on showing all the suggestions I received on this blog and also those sent to me directly a soon as I get the time. I am also planning on giving my 2 cents on load brokers, who by the way gave me the most feedback and comments on the article, go figure! In the meanwhile, here’s something to consider……
Thinking of becoming an Owner Operator?
One of my many day jobs just happens to be trying to help truck drivers to decide if it is a smart move for them to become owner operators and if it is to then advise them of how to get started and be successful. At ATBS I receive many emails and phone calls from folks who just need a little guidance and in some cases a simple gut check to ensure that they have covered all the bases in making their decision.
From those conversations I have developed a list of items to contemplate for those of you who are thinking of making the plunge and that I think might help some of you make up your minds on the subject. The conversations usually ramble a bit as I get to know what has driven the wannabe to begin thinking that this might be a good idea and a give me a little bit of a background on the individuals history in the industry, they also quickly notice that I try and get to the point as quickly as possible, not to be rude but to try and take some of the emotion out of the equation of a business decision. You can slide a long way on desire but at the end of the day the facts don’t lie.
First of all I try and determine if the individual is totally enamored with the idea of owning a pretty truck and being in control of the unit as far as tricking it out to be a show truck, and is this their main motivation above all else. This is usually a quick call, my advice, don’t do it unless you are independently wealthy and this is going to be more of a hobby than a career, you will die on the vine and be known as a wannabe.
On the other hand If wannabe is enamored as explained above and also has a desire to be an independent business person and or just has a burning desire to succeed and do whatever it takes to be successful in the trucking industry, then we move on to step two. Far too many people decide to become owner operators for all the wrong reasons and they look through rose colored glasses and see nothing but pasture’s a plenty of money. What they should be seeing is plenty of hard work behind the wheel, just as they had as company drivers, and in addition to all that hard work, they’ll need to maintain the vehicle, look after their paperwork and keep track of two dozen other critical things that need attention. This is of course where it all breaks down.
Step two is usually when I ask the wannabe if they have done a cash flow on their personal situation to determine if they have any idea what their monthly needs are on a personal level. Many New owner operators enter this industry under financed to begin with and when you’re under the gun financially before you turn your first mile your chances of lasting are dramatically reduced. I have advised many wannabe’s to wait until they were on sound footings financially before they look at becoming owner operators again.
Step three is when I try and explain what it will take for them to be successful and that they are becoming a small business and what that looks like from a business person’s perspective compared to a company driver’s perspective. Let me explain what I mean from the company drivers perspective, I have seen countless people become owner operators because they decided that they found a good deal on what they thought was a sharp dependable truck and they happen to know a company that wanted to hire more owner operators, usually it’ the one they currently drive for. There is nothing wrong with this scenario on the surface, it is done all the time, but unfortunately I give this person a 31% chance at sustaining this business for more than 5 years, this number is based on Industry Canada’s own numbers (http://www.ic.gc.ca/eic/site/sbrp-rppe.nsf/eng/rd01228.html) I give them a 10% chance of ever realizing what the full potential of that small business really is financially.
From a businessman’s perspective, at the risk of turning this article into a blatant testimonial for ATBS, we happen to have Business Manual for Owner Operators that were very proud of. In its pages there are 25 chapters that are in a somewhat logical order, buying the right truck is contained in chapter 15, choosing the right carriers is in chapter 18. What I am saying is that there is plenty of homework, education and planning that should be done before one should ever part with their hard earned money in the form of a down payment on a truck. It is this preparation that will increase your likelihood of winning at the game and making a realistic return on your investment in that truck. (http://www.atbs.ca/)
This is a hard industry but I think you would be hard pressed to find one in these hard times that isn’t difficult, that doesn’t mean that some folks won’t prosper, out of ruin and turmoil always comes winners, how does that happen? I think it happens because these folks prepare and plan and leave no stone unturned in their effort to be successful, they do their homework up front and they have a dogged determination to succeed.
Use your head when making a decision this size and research every bit of information you can find on this industry, can you imagine the increased likelihood of your success over the average Joe if you did this, why wouldn’t you do this, it’s your future your playing with here. Thomas Edison said, “Opportunity is missed by most people because it is dressed in overalls and looks like work.” Come to find out he also said, “It’s not the size of the dog in the fight it’s the size of the fight in the dog” this is my favorite of his. I said “Use your head and do the homework driver.”
Mr. Ray Haight has enjoyed a successful career in transportation starting as a company driver and Owner Operator logging over one million accident free miles prior to starting his own company. After stepping down from a successful career managing one of Canada’s 50 largest trucking companies, Ray focused on industry involvement including terms as Chairman of each of the following, the Truckload Carriers Association, Professional Truck Drivers Institute, North American Training and Management Institute and the Ministry of Training Colleges and Universities voluntary apprenticeship of Tractor Trailer Commercial Driver, along with many other business interests, he enjoys a successful consulting business, also sitting on various Boards of both industry associations a private motor carriers. He is also Co-Founder of StakUp O/A TCAinGauge an online bench marking service designed to assist trucking companies throughout North America focus on efficiency and profitability within their operations. All posts by Ray Haight