Fuel for Thought
The Downside of Becoming A Lease Owner Operator
With all the recent news of the need for more truck drivers, many are scrambling to get their CDL and go to work making the big bucks. Some will become company drivers, others will become owner operators and still others will not make it through truck driving school or training from their first carrier.
New entrants to the trucking industry arrive at their chosen truck driving school with dollar signs in their eyes and their head full of dreams. Most of their trucking knowledge at this point comes from TV or movies. The sky's the limit. Reality is a world away.
The training begins. Some pick it up fairly quickly, others… not so much. Those who pass now move onto the next step in the process, deciding what kind of truck driver they want to become.
Many see the owner operator as the crème de la crème of truckers for freedom and revenue. A rebel. A free spirit. The one who defines their own destiny. It is usually not until they have tried to purchase that first truck that reality rears its head.
You got your CDL so you are now a licensed operator. You cannot be an owner operator without a truck. Trucks can be quite expensive. If this is your first purchase or you do not have good credit, be prepared for a substantial down payment. Reality is on the horizon.
An owner operator is a small business. A lease owner operator is a small business partnered via a lease contract to a carrier. Reality is down the street.
The carrier has certain criteria the driver must meet just to lease on with them. A little freedom to choose is gone. The carrier may have certain policies that the driver would otherwise not wish to do, but to sign the lease is to agree to the terms. Reality is next door.
Now you have a truck and maybe a truck payment. And insurance. And maintenance. And fuel to buy. Taxes to pay. Tolls to pay. You might have to pay to park the truck. And this is all before you even get to your first load, even longer before that first payday. Reality is in your face.
If you ever heard the expression “it takes money to make money”, this is exactly what it means. You will need some money to get started before you ever see the first dollar earned.
Be prepared for a rocky start. As a business owner, you are now the responsible person for the ascents and descents that will come with most any business. Unexpected expenses, unforeseen taxes or fees or a windfall of customers, good or bad, you are the owner of your business and must shoulder all that is thrown at you to persevere. Reality is in your mirror.
The downsides of becoming a lease owner operator can be many, while some are up to the challenge, others are not. Keep up with your industry. Trucking, like most industries, changes constantly. The real downside to the owner operator is that too many choose to become complacent. Plan for the rainy day, sometimes it can be a rainy year… or two… or four.
See you down the road,