You’ve Just Inherited a Truck. Sell it or Hire a Driver?

That’s the question posted over on forum. The resulting thread includes 62 responses and gets into all the nitty gritty of insurance, business plans, lease/purchase vs. owning, profit margins, how many cents/mile you’d need, maintenance expenses, how much to pay employees, what benefits to give them, and on and on.

Survey Says….

The consensus seems to be that for the hard-working, business-minded individual, hiring drivers, while risky, can pay off in the long run.

One driver, who claims to own 15 trucks and net $110,000 a year, chimed in with the following comment: “I went door-to-door at every business in my town with my portfolio of my ideas and found a local business that needed my services. I’ve dedicated my entire fleet to hauling just their product – which cut out having to deal with brokers.”

It Could Be a Very Bumpy Ride

But this fellow, who identifies himself as “Sled,” may be one of the luckier ones. According to the National Assoc of Small Trucking Cos (NASTC), the failure rate of small, start-up trucking companies is about 85%. Only 15% make it to the second year of operation.

NASTC offers training to help aspiring fleet owners beat the odds. On their website you can find more info about their training.

On that page you can also find a list of about 20 questions – just the tip of the iceberg as far as the kind of business planning you’ll need to do: How do you plan to find freight? Where do you plan to run? How will you find insurance? How are you going to keep the books? How are you going to do log audits, fuel taxes, and driver qualification files? How are you going to manage and interpret data and information?

Getting More than the Going Rate: the Secret Sauce is Customer Service

There’s easily a hundred details to work out and a hundred smart decisions have to be made, but before you get overwhelmed, there is a trick of the trade that can improve your chances: great customer service.
According to this article in Heavy Duty Trucking magazine, working smarter, not harder is the key. And the smart way to work is to focus your effort on building great relationships with your best customers. Earn trust by going above and beyond, and the good customers will pay more than the prevailing rate.

The Small Fleet Advantage

In fact, small fleets are in a better position to go above and beyond for their best customers, says Keith Tuttle, president of Motor Carrier Service Inc. of Northwood, Ohio. “We do many things for our customers that the huge carriers cannot do,” he says. “We put a service moat around them to keep others out – the specialty stuff, the last minute calls, the weekend stuff. The idea is to make the customer look good to their customers, and they will keep coming back.”

Rich Hernandez of Mustang Express in El Paso – also quoted in Heavy Duty Trucking – attributes his success to “reliability and transparency” with his customers. He says, “I can’t haul every load, but the customers who trust me with their freight know I’ll be there when I say I will, and if something goes wrong, I’m on the phone working it out. I believe they appreciate my honesty and effort, because they keep calling back.”

Focus on Priority Customers

Hernandez some customers are always shopping for rates. He gives them the best service he can but when he has to prioritize, they aren’t at the top of his list. “I look after my good shippers and take care of the rest as best I can,” he says. “The key is knowing the difference.”