OOIDA’s Truck to Success attendees dive into owner-operator details
March 12, 2019
BLUE SPRINGS, Mo. – The first day of OOIDA’s Truck to Success course today laid the groundwork for attendees to think through the business plan that could bring them to being owner-operators.
About 50 people attended the class, a 2½-day intensive training for those ready to take their first steps toward becoming an owner-operator. Truck to Success continues through Thursday.
Driver Peter La Salle, a driver with 17 years of experience whose home base is in Savannah, Ga., said he was attracted to becoming an owner-operator so he could have more control over what routes and lanes he drove. Nice as that seems, though, he has many questions to work through, he said.
“My biggest thing in speaking with other truck drivers or owner-operators – they seemed to have a lot of different information. I was seeing a lot of owner-operators falling into the same traps,” La Salle said.
Often leased owner-operators feel trapped, he said, because a company can switch your routes and pay, and while under contract you have to stick it out to make your payments.
Angel Burnell, OOIDA chief of staff, was part of the OOIDA team welcoming attendees. She shared an overview of OOIDA history and its corporate structure. One of the things that makes OOIDA unique is that revenue from OOIDA truck insurance and other services helps fund an organization dedicated to fighting for the rights of all truckers.
Lewie Pugh, executive vice president of OOIDA, shared advice on buying new trucks, including knowing where you’re running and what you need when spec’ing a truck. He also said he is a big fan of buying extended warranties.
“Somewhere along the way, that $3,000 or $4,000 you paid for an extended warranty will pay for itself,” he said.
Pugh and Andrew King, OOIDA research analyst, began a discussion on tracking costs
“Money saved is money earned,” King said. “Controlling cost is where it’s at.”
King demonstrated ways to determine debt ratios and expense ratios and calculate variable and fixed costs. One tool drivers can use is at the OOIDA Foundation website. Under the “Tools” pulldown menu is a “Cost of Operation Spreadsheet” that drivers can fill out. It will automatically calculate net company income and gross profit margin.
Your salary should be included in your cost of operations, Pugh said.
“If you aren’t paying yourself more than you would make working for someone else, you might as well go and work for someone else,” Pugh said.
Getting a handle on costs is one of the most important things to do before becoming an owner-operator, he said.
“Two things you are going to hear over and over here are that you need to know the cost of operation and you need to read the contracts,” Pugh said.
Ron Ziegler, a salesman for Kansas City, Mo.-based Arrow Truck Sales, coached attendees on the first day of the seminar about buying used trucks. Drivers need an equipment plan, matching a truck to how you plan to use it. A financial plan is needed, and it is a tough part of the equation, Ziegler said.
“Because of people not like you here, who didn’t think it through and plan it out and learn what they need to know – they’ve made it so the banking industry is really giving us a hard look,” Ziegler said.
Also, a business plan, how you’re going to get paid, is mandatory.
Margo Fries, manager of OOIDA’s Equipment Finance Department, discussed financing. She said when buying used equipment there is a “CarFax for trucks” called RigDig.com. With a truck VIN, you can get an in-depth report on a used semi you are considering. Also, she suggested, calling original equipment manufacturers with a truck VIN can give you dealership records of used trucks.
The second day of the Truck to Success seminar has discussion of medical benefits, authority, permits and licensing, insurance, drug and alcohol regulations, and business structures and taxation. The third day, the agenda has load boards, brokers and other topics.