Things to think about as you prepare to become a thriving small business owner
If you’re thinking of taking your professional driving career to the next level by becoming a Vetrepreneur, a veteran who manages their own trucking business, chances are good you already know about the increased sense of freedom and opportunity. But successful Vetrepreneurs, commonly referred to as owner-operators, aren’t cruising Easy Street when delivering their loads; it takes dedication, discipline, perseverance, hard work and more.
As with any profession or business venture, there are pros and cons to being a small business owner in the trucking industry. You need to set realistic expectations and invest in learning as much as you can about the business before making your move. Here are some things to think about as you determine whether or not life as an owner-operator is the right path for you.
Becoming a successful owner-operator starts with making good decisions. There are many factors to consider, and choices and self-assessments that need to be made. It is a major decision that shouldn’t be taken lightly. Owning and operating your own truck is considerably different than being a company driver. As an owner-operator you are responsible for – and in control of – everything. When you make the switch from being a company driver, you leave behind company-provided benefits such as health insurance and retirement funds, which must now be managed by you. However, the entrepreneurial lifestyle as an owner-operator can provide the unique opportunity to pave your own way, choose your own freight, schedule your time at home and manage how much you want to make – you control your own destiny.
Before you make the decision to buy your own truck, it is crucial to know what it takes to set yourself up for success. As your own boss, not only will you be responsible for planning and delivering loads while complying with safety and regulations requirements, but you will also be accountable for your business duties – financial planning and management, bookkeeping, insurance, truck payments, operating expenses, maintenance, etc. Your big rig will become a traveling office, so to speak. On a daily basis, you will be faced with decision-making moments that will be critical to the success of your small trucking business.
Starting your own business can be overwhelming. Before running your own rig, you should explore what business opportunities exist, ask yourself and others in the industry questions and, most importantly, be honest with yourself.
To help you prepare for the challenge of following your owner-operator dream, here is the basic framework needed to build a profitable, self-sustaining small business. Key areas to carefully consider include:
Hauling choices are endless – van, tanker, dedicated account, intermodal, port dray. What segment of trucking do you have experience in, know inside and out, and enjoy doing? As a future owner-operator, you have the advantage of choosing a company to lease with that not only is reputable, but most importantly, is also hauling product that you enjoy working with.
Supporting Your Revenue Stream
It is essential that you lease with a company that has a large, consistent freight pool that allows you to run reliable miles year-round, providing steady revenue. Learn more about a company’s settlement or payment structure, equipment insurance requirements, discounts on operating costs (fuel, tires, maintenance, insurance, etc.), and what other advantages they offer. Consider talking to other owner-operators who lease with the companies you are interested in to gain invaluable knowledge.
Choosing the Right Equipment
Leasing or purchasing the appropriate equipment is key to an owner-operator’s success. Work with representatives at a reputable truck sales/finance company to set a budget while being true to yourself about what you can afford – new or gently used equipment. Spend the time and ask questions to gain insights.
It is also important to become familiar with the maintenance requirements for your truck. Will it be easily serviceable? What is the expected operating cost of the vehicle (miles per gallon, auxiliary power unit to save idling, etc.)? It should be comfortable and the right fit for you, the type of freight you are hauling and the areas in which you will operate.
Just as it is important to operate safely as a company driver, safety is a must to survive as an owner-operator. It is critical that owner-operators maintain their trucks and keep them in safe operating condition to preserve their CSA equipment score.
Another important consideration of being an owner-operator is deciding how you are going to finance your new or used truck. A reputable truck sales/finance company will be familiar with financing options and can offer plans that will help you reach your goals. Do not be scared off if you have bumps in the road in your credit history; truck sales and finance providers should have plans and options for different circumstances.
Picking the right lease program with the right carrier is essential to your success as an owner-operator. A leading carrier can help keep you moving – providing consistent freight and revenue. How many miles, what types of loads and what areas do you want to operate in each week to meet your revenue and time at home needs? You will also want to consider what type of lease will work best for you – a percent of revenue lease that allows you to select your own loads or a mileage-based lease that is dispatched by the carrier. Ask questions and choose the lease option that makes the most sense for your new business.
You will also want to be on the lookout for cost savings opportunities that carriers can offer such as fuel, tire, insurance, maintenance, accounting and other discounts. Will the carrier truly pass along all fuel surcharges? Does it have hidden costs that add up such as Qualcomm or other technology charges? Ask questions and make informed decisions that will impact your business.
Living Your Dream
By making informed decisions, leasing with a strong carrier and developing good practices, you can achieve your dream of becoming an owner-operator. As the saying goes, “All great journeys begin with a single step.” And yours should be researching the different opportunities available to you and asking the right questions of others in the industry. When you have finished your journey, you will have smoothly transitioned from professional truck driver to a successful small business owner. Best of luck!