Becoming an Owner driver (not another one i hear you say!)

UK PROFESSIONAL DRIVERS FORUMS OWNER AND FLEET OPERATORS FORUM (INTERACTIVE)
1

Hi Everyone,

Im in the very early stages of the possibility of becoming an owner driver, i have spent ages reading ALL of the messages on here and i would just like to post some thoughts and questions which i hope you guys will read and/or answer!

Im 27 years old, ive had an interest in the haulage industry for many years, and have worked in the office side of things since leaving school, ive got an abundance of experience in running trucks, which is the best paying work, how to run owner drivers and looking after their needs, and a good experience in containers, ro-ro trailers and general distribution, i currently still work as a traffic operator at a company in my local area, so unlike many new o/d’s ive read on here which dont seem to have much of a clue, i consider myself to be of extreme experience within the transport industry. Due to my current job position, ive also built up a healty list of contacts in the industry who would be prepared to offer me work (maily from the ro-ro trainler operators)

I have read many posts on here which seem to knock new o/d start, people stating the no sucess can be made from it, well i dont consider that to always be true. A good friend of mine started as an owner driver four years ago, he had one MAN TGA 410, and started pulling containers for the firm i was working for, he has now built up his business and now runs 3 Volvo FH globys, a merc megaspace, a DAF XF and has just ordered a new MAN TGA XXL, his business is extremely profitable, he makes good money. Obviously this has happened through sheer hard work and determination, no matter how many people told him its not worth it, he proved them all wrong. He now has a successful business, with his trucks on mainly RO RO work out of Ipswich, Felixstowe and Harwich, pulling fridges, tilts and 45ft boxes, he does night trunks & weekend work. From my opinion, this is through running it as a business, not as a hobby. He gets the right trucks for the right price, if he doesnt get good deals, or doesnt get good service from dealers, he takes his business to someone who does.Im not saying you guys dont run your buiness right, but i certainly have met and worked with owner drivers, who treated it more as a hobby, like just because he is his own boss, he doesnt need to work very hard.

I know ive rambled on abit, but basically, i feel with the experience i have, and the similar levels of determination i have with my friend, i think i could make a success of it too. I have a few questions though, which id be hugely appreciative if you could help me out on.

As a new start, i feel for the first year, id definately be stupid to spend any more than £20k on a vehicle, as the used vehicle market seems pretty saturated with quality 6x2 tractor units at present. After reading posts on here, most of you guys seem to take a real dislike to both the Iveco Eurostar and the Renault premium, but these are both trucks which, in my experience of dealing with O/D’s, have proved excellent, reliable trucks, which you get a hell of a lot of vehicle for your money. To me, it seems madness that for say £18K as a new start, you would go out and buy an X-reg Scania standard cab 420 with a good 500-600k on the clock, when you could get a 02, 52 or 03 plate highly specced and spacious Eurostar or Premium with much lower mileage on the clock, just because it has a Scania badge on the front, it just doesnt seem to make good economic sense, As most people ive spoken to, and most magazines ive read, seem to praise both the Eurostar and Premium for low running costs and reliability. As i said, this is an area im not so experience in, so im looking for you help on this one! As a new o/d, which would make the most sound buy?

Again, im sorry if ive rambled on abit for my first post, and hopefully i look foward to your replies, both on my view of the industry and my questions/comments regarding vehicles!

Niceone

2

can’t help with the wagon as i’ve never run either but i’m curious as to why you’d want to drive a wagon, with all your experience could you not make more money as a freight forwarder, passing work on to existing o/d’s with very little financial risk?

3

Thats part of the problem with the industry Paul.

Too many freight forwarders ■■■■■■ the job,taking the lions share of the profits.

My opinion is that the sooner all these small so called forwarders are out of it the better,they contribute very little to the job but just keep taking from it,for very little work or responsibility.

4

The purchace price of the truck is not the most expensive part, It’s the running costs aswell. A scania 114-380 or 124-420 give excellent MPG running at 44 tonnes (8.5-10 MPG) whilst a Renault will give 11 MPG running light it will only return 7-8 MPG running at 44 tonnes. To put that into money based on 75000 miles per year and fuel at £4.20 a gallon. A truck returning 7 MPG will burn £45000 worth of fuel whilst a truck returning 9.5 MPG will burn £33157 which is £11843 a year and over 5 years that is £ 59215. so paying that little bit more for a scania will certainly pay off!
And I was going to buy a V8 actros. I think I’ll go for a 114-380 Scania now I’ve seen the fuel savings!!
Also a scania/daf/volvo are generaly more reliable trucks and when you do need a part for one of the 3 trucks I just mentioned the dealers will probably stock the part you need. Where as with Iveco or renault they will have to order it in and it will probably have to come from Italy or france and will take a couple of days.
Sorry to go on but every little helps with the cost of fuel it this country!

5

ive drove both trucks both 6x2s and although the eurostar has a bigger cab the premium was more reliable and better on fuel and both were 420,s although you can get a a decent 430 cursor iveco with auto box for the money your spending dont get a 470 as ive been told there very thirsty. :wink: :laughing:

6

Robbies Dad:
Thats part of the problem with the industry Paul.

Too many freight forwarders ■■■■■■ the job,taking the lions share of the profits.

My opinion is that the sooner all these small so called forwarders are out of it the better,they contribute very little to the job but just keep taking from it,for very little work or responsibility.

agreed, but as things stand without these people large or small they’d be very little work for o/d’s, wether that works worth doings is a different thing.

7

thanks for replies so far!

I see what you mean by the operating costs you described, and i would have to agree about the Scanny 114 380 because at 2 places ive worked, we were constantly amazed at the fact that they can return 9.5-10mpg even on 44t work!!!

What are your thoughts/advice one the first part about making a success of it??

niceone

8

It’s all about contacts and knowing where to get the best paying work from which by the sounds of it you have, don’t do work for crap rates. Also keeping it running 50/2 weeks a year and not being short of work as this break in cashflow causes problems. Double shifting it helps as well but you need to be careful you have a plan in place if it breaks down or is very delayed (spot hire). I factor my invoices which helps with cashflow and I think the percentage the factoring company takes is worth having regular weekly payments in to your bank account although will not protect you if the firm goes bump. Get as short credit terms as you can. If you do get more than one wagon put them on for different firms so all your eggs aren’t in one basket. Don’t get too flushed with success and keep looking for the problem that will make it all go pear shaped.

9

There is so much to take into account - Only you know if you can handle the pressure of running a truck! the biggest problems are well paying work, Getting paid on the time you agreed to and having enough money for every thing for the first 2-3 months until the cheques come in and you need a lot of good luck! I was having a break in a lay-by 6 months after I started and a car crashed into me at 40 MPH! so that put me off the road for 5 weeks in the busiest month. I wouldn’t use a factoring company myself as they take 2.5 - 4 % of the invoice so over a year they could take something like £3500 off you which would nearly pay for your vehicle insurance and G.I.T. Have you had insurance quotes? (I use John Peers at Wrexham) Have you applied for an operators licence yet? If you have your own CPC, It will save you money in having to pay a transport manager so more money in your bank at the hardest time until the cheques start to come in the better it will be. Do you really want to be doing 3 x 15 hours and 2/3 13 hour shifts when you probably only do 9 hours now?? If you do it good luck. Im glad I did it now but it took me 12 months to think that! every week when something else went wrong I was jackin! but I kept at it and Im glad I did.

10

i just thought i’d post this for those considering having a go, those that have been involved in the game will already know the ins n outs but for those that havn’t consider this-
everyone talks about good and bad paying work which is understandable, if you take on something thats easy to get a start on,such as the firms that always advertise in the mags, you’ll get weekly payments after the first month, a fuel card etc, maybe trailer hire all deducted out of your money so in effect your not shelling out any real money to do the work, the downside of these setups is of coarse, the rates are crap, in my opinion they don’t warrant running a wagon as the best you’ll do is earn a drivers wage so everyone on this type of work is continually looking fo that better job.
now without knowing what other lads are earning i would guess that what i do now would be classed as good work, i run for a large haulage firm on a traction only basis, they take nothing for trailer hire etc and the rates are probably as good as i’ll find for regular work doing anything, the down side? the payment for the work although officially 30 days is in fact nearer 60 because you actually get paid on or around the 15th but payment is by cheque which takes a working week to clear so as an example i’ll have done a full month at the end of this week which i would expect to be between 9-10k worth of work, not bad at all until you weigh up what it’s cost to do that work, for me with no finance on the wagon i would say between 4.5- 5k so i stand to make around 5k on the month not bad at all for driving a wagon you may think but in reality by the time i get that first payment i’ll have run the wagon for the best part of three months and even with fuel accounts and everything else which i can pay on thirty days i’'l have spent between 10- 12k or more by the time i get that money, ok, on paper i’ve earnt a nice few bob but my bank is overdrawn and in real terms i’ve not seen any money that i can take as my own in three months and thats a long time! the thing is, you will never catch that money up all the time your doing the work, you won’t ever see that first months money until you pack the work in and have a month where you don’t shell anything out. if i had a truck on finance i’d be in an even worse position.
the harsh reality of owner driving is, you either work for peanuts or you use your money to finance someone elses business.

11

This is not a criticism of anyone on here because I expect times have changed in 30 years, but when I had my own trucks all my work (apart from backloads) was direct. No middlemen. I went out with a case full of business cards and knocked on doors. I worked for furniture makers, fireplace makers, fabric suppliers, garment makers, a bulk petfood supplier, an importer of gas heaters, the North Sea oil rig building business, and others. I worked out the costs and I quoted the price. People didn’t tell me what they were going to pay anymore than I did at the garage to the man who sold me my diesel.
And I had enough surplus to backload other small hauliers.

12

Spardo:
This is not a criticism of anyone on here because I expect times have changed in 30 years, but when I had my own trucks all my work (apart from backloads) was direct. No middlemen. I went out with a case full of business cards and knocked on doors. I worked for furniture makers, fireplace makers, fabric suppliers, garment makers, a bulk petfood supplier, an importer of gas heaters, the North Sea oil rig building business, and others. I worked out the costs and I quoted the price. People didn’t tell me what they were going to pay anymore than I did at the garage to the man who sold me my diesel.
And I had enough surplus to backload other small hauliers.

Indeed they have!! You just cant get work by doing that anymore in this present day and age.and yes its now the other way round, you get told what you are going to be paid and when, surely it should be the other way around, the haulier is doing the work !! But no, you get told, and yes you may get 30 day payment terms but this never works out and its normally 30 days from invoice so you are only really getting back one weeks money every 30 days (if yer lucky)

Month 1 = 30 Days
Month 2 You submit all you invoices for Month one, you have to wait 30 days to get paid and normally wont be until a particular day for a bacs run increasing the time or getting paid by cheque
Month 3 You get paid by cheque but have to wait 3 working days for it to clear , or you have to wait until the 15th of the month until the firm does a Bacs run.

You have since now done a further 6 weeks worth of work whilst waiting to get paid for the first lot, BANG the company shuts shop, you go bust, lose your house, wagon, car, things get repossessed, you get blacklisted and end up with CCJS, depressed and broke

The company starts up again a few weeks later under a different name. Is it really worth it ?

Unknowingly O/Ds are really just a credit provider. The sad thing about it no credit company / bank / fuel company is prepared to give the o/d any credit at all and if they do they want paying every coupl eof weeks or you have to put a bond up. A bank wont lend you any money and will not give an overdraft until he sees regular money coming in.

Y are O/Ds diving credit to firms they know nowt about ?

You fuel is collated over the month and you are probably billed 13 days after the close of the previous month for the whole of the month and they collect payment. Y cant O/D do this ? Your first invoice will be 6 weeks old but your last invoice for the month will only be 2 weeks old, and your paid, you shouldnt have to wait 30 days for it.

13

Yes I thought as much Routier, but on the money front, what I did was invoice weekly the money due by the last day of the following month. I also gave a discount for on time payment (already factored into the quote). One of my regular customers, an ex finance director of Petfoods who knew the value of every penny, would drive over from Leicester to Nottingham to give me the cheque if he thought he might have left it too late.

14

Another common way of delaying payment was to withold Rate Confirmations. I was forever having to chase these as you cannot invoice without a confirmation or a statement.

Anybody who makes a mistake on an invoice may as well not bother invoicing the company. It will be returned unpaid for another month.

15

Can i just ask why it is that companies that employ O/D have the rule of payment of 30 days +?

surley if they are a big company, and provided the weeks work is done, you should be able to invoice them weekly, after all they have the funds avaailable even if they haven’t been paid for he work yet…it was their choice to decide to get paid that way.

I think O/D should be able to invoice weekly…even if it is by cheque, its better than 6 weeks plus.

sorry if my questiong is stupid.

16

RookieTrucker:
Can i just ask why it is that companies that employ O/D have the rule of payment of 30 days +?

Because it helps their cash flow and to put it bluntly because they can ride roughshod over smaller companies. The small business or OD needs the big company much more than the big company needs the OD. A small business or OD can be frightened of taking a stand against slow or late payment, if they do the big company can just stop using them, remember there are very few contracts in the transport game between OD’s and big firms. The companies can always find somebody else to fill the gap if they stop using an OD, much harder for the OD to find other work.

RookieTrucker:
surley if they are a big company, and provided the weeks work is done, you should be able to invoice them weekly, after all they have the funds avaailable even if they haven’t been paid for he work yet

Not necessarily, Just because they are a large company doesn’t mean they have available funds. Cash flow is one of the biggest problems for all businesses, big or small, and the large concern can have exactly the same problems as the sole trader, only on a far larger scale. However, the banks will give a larger company more leeway, because they could be into them for far more than the small firm. Their suppliers are liable to give them more leeway on paying for goods and services than they would give the OD because they are more valuable to them as a customer. We know that is true because by choice or not the small business or OD, as one of their suppliers, does exactly that. The large companies ease their cashflow problem by delaying payment, the OD doesn’t have that option.

The simple fact is that the OD is at the bottom of the pyramid when it comes to getting paid and short of not working for the slow paying company, which could do more harm than good, they are screwed.

The only thing that might improve things, would be a law that made it illegal to pay later than 30 days. Even then companies could ignore it and the small guy may still be to scared to do anything about it for fear of losing the work. Various Government’s have given ‘advice’ for small businesses on late payers, but it amounts to not much more than sending a letter asking for payment or putting stickers on your invoices and statements to encourage prompt payment. In other words no useful or constructive help because no Government in this country would risk upsetting big business by introducing laws requiring them to pay promptly.

17

Wheel Nut:
Another common way of delaying payment was to withold Rate Confirmations. I was forever having to chase these as you cannot invoice without a confirmation or a statement.

Anybody who makes a mistake on an invoice may as well not bother invoicing the company. It will be returned unpaid for another month.

Jobs should never be done without knowing the rate first. No good arguing about the rate after you have done the job!

18

routier:

Wheel Nut:
Another common way of delaying payment was to withold Rate Confirmations. I was forever having to chase these as you cannot invoice without a confirmation or a statement.

Anybody who makes a mistake on an invoice may as well not bother invoicing the company. It will be returned unpaid for another month.

Jobs should never be done without knowing the rate first. No good arguing about the rate after you have done the job!

I agree, but a lot of companies will only pass invoices for payment after a confirmation has gone to the supplier, showing a Job Reference and is able to be tied to a particular invoice. A confirmation note will normally show demmurrage allocated to a job as well.

It is another one to go on Neils list of bigger companies riding roughshod over small fry.

In an ideal world, you would invoice for every single job on a seperate invoice. As things normally work, you are invoicing for a week or a month and any discrepancy holds the complete payment process up. sometimes till the next month.

We all need a regular cash flow

19

Wheel Nut:
In an ideal world, you would invoice for every single job on a seperate invoice.

You mean I have been living in an ideal world for the last 17 years? ■■■■ I wish someone had told me. :wink: :smiley: :smiley:

Every job I have ever done has gone on a separate invoice. Recently i was working nights and on occasion did say two Dunstable to Lutterworth or Birmingham return trips and even though it was one nights work that was two invoices. They preferred it that way as they tied each invoice to each job.

20

NICEONE:
Hi Everyone,

Im in the very early stages of the possibility of becoming an owner driver, i have spent ages reading ALL of the messages on here and i would just like to post some thoughts and questions which i hope you guys will read and/or answer!

Im 27 years old, ive had an interest in the haulage industry for many years, and have worked in the office side of things since leaving school, ive got an abundance of experience in running trucks, which is the best paying work, how to run owner drivers and looking after their needs, and a good experience in containers, ro-ro trailers and general distribution, i currently still work as a traffic operator at a company in my local area, so unlike many new o/d’s ive read on here which dont seem to have much of a clue, i consider myself to be of extreme experience within the transport industry. Due to my current job position, ive also built up a healty list of contacts in the industry who would be prepared to offer me work (maily from the ro-ro trainler operators)

I have read many posts on here which seem to knock new o/d start, people stating the no sucess can be made from it, well i dont consider that to always be true. A good friend of mine started as an owner driver four years ago, he had one MAN TGA 410, and started pulling containers for the firm i was working for, he has now built up his business and now runs 3 Volvo FH globys, a merc megaspace, a DAF XF and has just ordered a new MAN TGA XXL, his business is extremely profitable, he makes good money. Obviously this has happened through sheer hard work and determination, no matter how many people told him its not worth it, he proved them all wrong. He now has a successful business, with his trucks on mainly RO RO work out of Ipswich, Felixstowe and Harwich, pulling fridges, tilts and 45ft boxes, he does night trunks & weekend work. From my opinion, this is through running it as a business, not as a hobby. He gets the right trucks for the right price, if he doesnt get good deals, or doesnt get good service from dealers, he takes his business to someone who does.Im not saying you guys dont run your buiness right, but i certainly have met and worked with owner drivers, who treated it more as a hobby, like just because he is his own boss, he doesnt need to work very hard.

I know ive rambled on abit, but basically, i feel with the experience i have, and the similar levels of determination i have with my friend, i think i could make a success of it too. I have a few questions though, which id be hugely appreciative if you could help me out on.

As a new start, i feel for the first year, id definately be stupid to spend any more than £20k on a vehicle, as the used vehicle market seems pretty saturated with quality 6x2 tractor units at present. After reading posts on here, most of you guys seem to take a real dislike to both the Iveco Eurostar and the Renault premium, but these are both trucks which, in my experience of dealing with O/D’s, have proved excellent, reliable trucks, which you get a hell of a lot of vehicle for your money. To me, it seems madness that for say £18K as a new start, you would go out and buy an X-reg Scania standard cab 420 with a good 500-600k on the clock, when you could get a 02, 52 or 03 plate highly specced and spacious Eurostar or Premium with much lower mileage on the clock, just because it has a Scania badge on the front, it just doesnt seem to make good economic sense, As most people ive spoken to, and most magazines ive read, seem to praise both the Eurostar and Premium for low running costs and reliability. As i said, this is an area im not so experience in, so im looking for you help on this one! As a new o/d, which would make the most sound buy?

Again, im sorry if ive rambled on abit for my first post, and hopefully i look foward to your replies, both on my view of the industry and my questions/comments regarding vehicles!

Niceone

I have a Renault Premium, I’ve had it 15 months, and the only things it’s needed was a water pipe in over 170,000k It’s light, as economical as any other truck I’ve had, and a pleasure to drive. It has been uprated to 460bhp, and the tacho recalibrated with ■■■■■■■■■■■■ tyres, :wink: (great now I’ve got the new tyres on) speak as you find I always say, I had my 1st Renault premium in 1998 and it was a nightmare I swore I’d never have another, it’s down to Thompsons commercials and a good mate of mine, who runs em, that I got the one I have now.