What I've been offered - appreciate your opinion

Hi guys;

I’m a 29 year driver with a CPC National Freight I took in 1990/91. I’ve not (as yet) used my CPC to gain an operators license. After explaining all this to an acquaintance of mine during a conversation about driver shortages he says to me “Why not become an owner driver? We’re currently looking for reliable experienced subbies.”

The job is with a well known operator, with 5 or 6 depots dotted around the country.

The work is all tautliner. The rate I’ve been offered is £330 a day basic just for turning up, plus 50p for every mile according to the tracker report. That’s for traction only. Their trailers, no rental.

If they park me in a corner for the day I earn a flat £330 regardless.

Daily average is +/- 450, mainly motorway miles, delivering to regular destinations, so its fair to suggest I could soon become familiar with the drops, hopefully saving time and money. The work is 7 days so there’s scope for the truck to work with a driver when I’m not working.

Although the work isn’t top weight, a 3 axle unit is a necessity, with their tri axle trailers, for the sake of back loads.

Payment terms are weekly after thirty days.

As mentioned I’m a lorry driver and I know driving lorries. But owner driving is a whole new ball game.

SO my question here is, how does it sound as a deal? What questions should I be asking?

Thanks for your input.

Sounds not too bad,
will they give you all above in signed contract??

Have you a decent sized savings pot??

CVA auction £6k Premium for you too then!!!

There you go Smithy,
Not enough drivers so more sensible paying work for a subbie!!!

My first question would be, do you want to be a O/D?

Although im not currently a O/D its the way i want to go and im currently studying for my cpc. From what iv learnt already i think it needs to be something you want to do, as going at it half arsed wont end well.

As said, will you get all that in a contract? 365 days a year.

450 miles a day will see you only at £530 a day, on max hours and with max useage of fuel which imo is to little

Concretejim:
My first question would be, do you want to be a O/D?

Although im not currently a O/D its the way i want to go and im currently studying for my cpc. From what iv learnt already i think it needs to be something you want to do, as going at it half arsed wont end well.

As said, will you get all that in a contract? 365 days a year.

450 miles a day will see you only at £530 a day, on max hours and with max useage of fuel which imo is to little

£525 a day isn’t it ? , I wouldn’t be going 225 miles each way possibly loaded each way too for £525 ,needs to be more like £925 plus imo .

Big Truck:
Sounds not too bad,
will they give you all above in signed contract??

That’s a good question. Currently all I have is a bunch of emails from one of the company directors, outlining the deal.

Big Truck:
Have you a decent sized savings pot??

I have a rainy day fund which I was hoping to speculate with a view to accumulating.

Big Truck:
CVA auction £6k Premium for you too then!!!

I was thinking of something a little later. Perhaps a lease deal with maintenance as I’m not keen on lying under a truck every weekend in my downtime. Much prefer to drop it off to a dealer. Having said that this company has their own workshop facilities/tacho lane etc so that’s an option too.

Do I want to be an owner driver? I’m on the wrong side of 50. September 2018 will see me 30 years in the industry and I reckon I’ve probably only 4 or 5 years left in me doing the job. So I’m hoping to find something which would be linked to my own effort without any caps. I don’t mind putting in a shift if the rewards are right.

I’ve been invited to spend the next few weeks working with the company on a (half decent) hourly rate, PAYE, to have a look at what they do. Starting tomorrow night.

They’ve been very transparent up to now and I see no reason for that to change as its a medium sized, very well known family concern. Maybe I’ll find some more answers after seeing the job first hand? Its not a Christmas gig so I have time in hand for due diligence. I guess time will tell.

In the meantime thank you both for your opinions.

You’re gonna be maxing out at about £500 gross/day plus maybe a weekend driver that’s gonna want an “enhanced” wage.
Would be looking to pick up a decent 5yr old yoke ex contract/lease hire sub £10k for 1st year anyway.
Sure the firms workshop should be able to offer you sharp quotes to look after inspections/service and any unforeseen “problems”!!!

Are the contract/lease hire deals handy to come by as a new start O/D??

On the figures you’ve given, it looks like your max earnings will be around £550 per day.
If you do 450 miles, that comes out at around £1.22 per mile. Your fuel bill, if they keep you loaded both ways, will be around £240 per day, (8 mpg @ .95p per litre).
It’s doable, but not brilliant. The £330 per day guarantee sounds like a bit of clever psychology to make you believe you might get something for nothing. If you know them, and they are decent to work with then give it a go by all means, but you’ll be lucky to make more than the same as a reasonably well paid driver can.
I’ve been at it forty years now on my own and don’t ever take work where the fuel cost will be more than one third of the rate on offer. Ive not made a fortune, just a good steady living of around £50K while running g decent but not new trucks.
I’d say have a go, and good luck to you sir

Sit down with your calculator and see what works for you.
But on the face of it £330 standing charge for a straight forwards standard tractor and no trailer costs is fine, as long as it’s in writing payable for a mimimum of 5 days per week even with no work. 50ppm on the otherhand seems a bit light to me since fuel alone at 95ppl and 8 mpg is 54ppm. If you can get the same standing charge and 50ppkm, and it’s something you want to do, I think it’s probably worth a closer look. But your calculator is your friend.

Sounds like a silly mileage rate using the big retainer as an attempt to sweeten it. As usual fuel costs will probably be what makes the sums not add up regardless.

This offfer is very similar to what Maxihaulage offered me. Fixed weekly rate and ppm. Using their trailer. Its only good if you do 1000-1200 miles so ppm at the end is higher than usual. But im sure they use subbies for maximum hours.
Maxihaulage 1600 miles = 2019£ = 1.26 ppm
Maritime offers 1.35 average 1600 1700 miles ( their quote ) weekly = 2160£ Trailer hire weekly 80£ for container, or 90£ for curtainsided.

So, 1600 miles weekly , maritime +141£. Pay weekly trailer hire , and still 60£ more than Maxihaulage.

Let’s say work very hard, max hours , 1900 miles a week.
Maxihaulage gives 2184£ = 1.15 ppm
Maritime gives 2565£ = 1.35 ppm.
Weekly difference after trailer hire is 300£ more with maritime.

I’m not an owner driver, but I asked various big names. Additionally Barron wood offers 1.40£ and you get your trailer or rent. So it’s even slightly better than Maritime rate.

So here the actual offer from Maxihaulage, and after I reply them ; the more I drive the less I earn. They didn’t reply back.

Average is about 1500 - 1800 miles, but if on multi drop work this can be less. However some subbies do more.

Rates would be as below:

For the work you might undertake for us we would propose the following way of paying. We will guarantee a fixed weekly rate of £1139.00 (sterling) to cover you’re fixed costs even if you don’t turn a wheel. There is a 10% margin built in so you will always make this margin. Thereafter we will pay 55p per mile (auto routed miles) Based on present fuel cost of 89 pence per litre. The pence per mile quoted is based on fuel price at present, which means if fuel goes down the price per mile will too, if it goes up then so will pence per mile.

miles 0.55ppm £1,139.00

1000 £550.00 £1,689.00

1250 £687.50 £1,826.50

1300 £715.00 £1,854.00

1400 £770.00 £1,909.00

1500 £825.00 £1,964.00

1600 £880.00 £2,019.00

1900 £1,045.00 £2,184.00

How much will it be to Hire a trailer from Maxihaulage?

Ans: Maxi does not charge for any trailers used.

What sort of insurance requirements needed?

Ans: We would require you to have a minimum of RHA 2009 £2,000 per tonne for all Maxi work.

.

I’m a 29 year driver with a CPC National Freight I took in 1990/91. I’ve not (as yet) used my CPC to gain an operators license. After explaining all this to an acquaintance of mine during a conversation about driver shortages he says to me “Why not become an owner driver? We’re currently looking for reliable experienced subbies.”

You are very special driver, anybody who takes his CPC National Freight at the age of 2 is very impressive!!!

caledoniandream:

I’m a 29 year driver with a CPC National Freight I took in 1990/91. I’ve not (as yet) used my CPC to gain an operators license. After explaining all this to an acquaintance of mine during a conversation about driver shortages he says to me “Why not become an owner driver? We’re currently looking for reliable experienced subbies.”

You are very special driver, anybody who takes his CPC National Freight at the age of 2 is very impressive!!!

He said he’s been driving HGV’s for 29 years not that he is aged 29, ya dopey bugger!

My standing costs per day, (including £78 a week for skelly hire) minus my salary are £133.67 a day.

Diesel based on 450 miles at 9.5mpg, reasonably easily done with a E6 wagon and a well set close coupled wind deflector: 215.34l a day, current price for me is 0.9593 per litre so £206.58 a day in diesel.

Total costs: £340.25

£550 a day - £340.25 = £209.75.

Name me one PAYE driver who can bring that in a day on general taut work.

My numbers are based on a five day working week.

The agency I have lined up just in case I need them will provide a driver at £125 a day for the driver + £30 commission so £155 plus any nights out if you need an agency driver. If you are going to put someone in on PAYE its pay rate x 1.138 to figure out costs.

If you are going to pay £10.50 an hour and pay all hours, thats 71 hrs x 10.50 = £745.50 x 1.138 = £848.38 so £169.68 a day in wages.

£209.75 - £169.68 = £40.07 profit a day or £10,418.20 per vehicle per year.

If the vehicle never works and just earns the £330 a day you still make £26.65 profit a day, even after paying the driver for a full days work!

Just to recap, thats accurate standing costs for a first year new operator + reasonable fuel cost calculations + worst case staffing costs. Not pie in the sky numbers.

You are guaranteed earnings, even if the wheels don’t turn and you have to do 1500 km a day before you start losing on the price per mile bit, (based on my running cost per mile), which is only feasable if you are double shifting the wagon and both drivers are doing 8.33 hours at flat out motorway miles.

If I had this offer on the table I’d be very seriously tempted but it would have to be in writing and would need to include a fuel cost escalator and a reasonable demurrage rate.

nsmith1180:
If you are going to pay £10.50 an hour and pay all hours, thats 71 hrs x 10.50 = £745.50 x 1.138 = £848.38 so £169.68 a day in wages.

Are you sure this is right? i was looking into PAYE some time ago and with all the NI, Pension and holiday pay contributions i got almost 1.3 multiplier rather than 1.138…

Priest:

nsmith1180:
If you are going to pay £10.50 an hour and pay all hours, thats 71 hrs x 10.50 = £745.50 x 1.138 = £848.38 so £169.68 a day in wages.

Are you sure this is right? i was looking into PAYE some time ago and with all the NI, Pension and holiday pay contributions i got almost 1.3 multiplier rather than 1.138…

My accountant says 13.8%. I’m only going on what he says.

Edit to Add:

Just read again and spotted the holiday contributions bit.

I put holiday down as a normal week, so each full timer is paid a 52 week year when doing calculations. To account for holiday, add in another £21.21 a day to the standing costs.

Costs of a holiday driver:

The cover driver gets 5.6 weeks holiday a year so 52 - 5.6 = 46.4 workable weeks / 5.6 weeks = 8.28 vehicle a year, round it to 8.

848.38 x 52 = £44,115.76 / 8 = £5,514.47 extra per vehicle per year. / 52 weeks / 5 days = £21.21 per day per vehicle.

Though if you had year round 7 day a week work you could save money by putting your drivers on 4 on 4 off. Each driver then only works 182 days a year rather than 260 or 70% of the time, so on the averages you pay for holiday pay, your cost is 30% lower.

On 4 on 4 off though you are paying drivers for 8.7 6 weekly inspections and two days of MOT prep and test a year whereas on 5 days working you can schedule that work for weekends and not lose anything as the vehicle was never planned to earn on those days.

Give you one thing Smithy,
Your S----hit hot on the figures lad

Big Truck:
Give you one thing Smithy,
Your S----hit hot on the figures lad

The beauty of the boxes. Plenty of time to google.

caledoniandream:

I’m a 29 year driver with a CPC National Freight I took in 1990/91. I’ve not (as yet) used my CPC to gain an operators license. After explaining all this to an acquaintance of mine during a conversation about driver shortages he says to me “Why not become an owner driver? We’re currently looking for reliable experienced subbies.”

You are very special driver, anybody who takes his CPC National Freight at the age of 2 is very impressive!!!

Just what I thought.

Ken.