Carryfast:
If fuel duty and VAT were removed together
Fuel duty and VAT have nothing to do with it, at least not in the area I was working in. I agree it will be different in the south and on general haulage though.
In the bulk tipping game the issue is simply one of supply and demand. If fuel duty was abolished then within a month everyone would have run round rate cutting to try and get more work and the result would be earnings after fuel back exactly where they were before. Anyone who thinks a duty reduction knocking a few hundred quid a week of the fuel bill will result in a few hundred quid more profit is a fool.
fly sheet:
It strikes Me this is like groundhog day with Rob K, He does however have some valid points that should be taken into consideration before starting out as an OD. The problem being many prospective OD’s don’t want to hear it as its there life long ambition to see themselves in a big shiny truck.
The late Les Phillips of Intersped once told Me good business men/woman flourish in times of recession as they have to try that bit harder luck will play a part its a life thing.
The problem now is that it’s not just about a recession it’s an actual deliberate government policy to make road transport a less attractive and economically viable choice for the customer.If fuel duty and VAT were removed together with more flexibility by deregulation of length and gross weight limits then the situation and viability,of subbing out to specialist traction operations,would create a much better business environment for owner drivers.
While the attraction of being an owner driver,at least in my case,wouldn’t be all about wanting to drive a big shiny truck it’s more about being able to pick and choose which sector of the industry to work in and therefore the type of work.In which case an expensive new shiny wagon would be at the bottom of the list as a new start when what’s needed is something that’s up to the job for as little capital outlay as possible.In which case it would most likely to be the luck part of the equation that’s most important in both terms of reliability of the wagon and the amounts of work available at an acceptable enough rate to provide at least as much of a wage as would be possible as an employed driver after all the overheads.In which case it’s only the issue of fuel costs and the levels of east european competition and therefore over capacity in the uk-european haulage market that gives any credibility to Rob K’s case.
So in summary you’ve just listed pretty much every reason why it’s a bad idea and therefore you are in agreement with me.
But not in all sectors, eastern Europeans do not heavily compete in the 44 tonne domestic sector for example because they don’t run 6x2 tractor units. In six months I have yet to speak to another subbie who spoke with a foreign accent.
Fuel costs are largely irrelevant to me too as I get paid a fuel surcharge which tracks the RHA’s weekly diesel price. Not all sectors, or all hauliers work in the same way and it’s irrelevant to take UK-European traffic in isolation and say that because that does not pay a reasonable rate, than nothing pays a reasonable rate.
Harry Monk:
But not in all sectors, eastern Europeans do not heavily compete in the 44 tonne domestic sector for example because they don’t run 6x2 tractor units. In six months I have yet to speak to another subbie who spoke with a foreign accent.
Fuel costs are largely irrelevant to me too as I get paid a fuel surcharge which tracks the RHA’s weekly diesel price. Not all sectors, or all hauliers work in the same way and it’s irrelevant to take UK-European traffic in isolation and say that because that does not pay a reasonable rate, than nothing pays a reasonable rate.
If he’d added UK-UK in his list then it would be everything.
460MC: really enjoy reading robs posts, its really unhealthy the amount of time effort he puts into these posts to discourage potential O D.
I’d love to know if he has actually had a go and failed miserably that would really make me chuckle.
Spill it
I also enjoy reading mr k’s posts, he does make some good points at times!
i would also like to know what his history is as regards being an o/d, is this to much to ask?
moose
Where you go wrong Rob is in this assumption that anyone who puts a truck on the road does so simply because they are a glassy-eyed dreamer on some type of vanity trip, somebody who wants to see their name on the doors.
I’m sure many people do do that, but equally many others do it as a considered business decision and I would include myself in that description.
I’ve only been at it six months so I don’t hold myself up as an expert, but in that time I have taken a reasonable wage and earned considerably more return on my investment than if I had left the money in ISA’s or savings where they were earning next to nothing due to ZIRP.
Had I started entirely on finance and taken out full HP on a brand-new top-of-the-range Scania (I have part-finance on an 08-reg Renault, but that’s all) then finance repayments would probably make it not worth doing but as things stand I’m satisfied that I made the right decision.
But yes, given that I spend all week at work, I do like having a work environment which nobody else ever goes in, which I can have exactly as I please and I do enjoy having greater control over my own destiny.
Personally, my only regret is that I didn’t do it sooner. I’ve spent about two years out of the last three being unemployed through no fault of my own and as I don’t qualify for benefits I seriously depleted my savings in that time. Now I am no longer depleting them but re-building them instead. If you think I am doing this because I am in some way a cab-happy dreamer then I am afraid you are very much mistaken.
EDIT re the post above this, although I disagree with Rob on many points, it is refreshing to have an actual proper debate, it’s a bit like the old days on TruckNet!
Carryfast:
If fuel duty and VAT were removed together
Fuel duty and VAT have nothing to do with it, at least not in the area I was working in. I agree it will be different in the south and on general haulage though.
In the bulk tipping game the issue is simply one of supply and demand. If fuel duty was abolished then within a month everyone would have run round rate cutting to try and get more work and the result would be earnings after fuel back exactly where they were before. Anyone who thinks a duty reduction knocking a few hundred quid a week of the fuel bill will result in a few hundred quid more profit is a fool.
Paul
Your waisting your time on that one Paul. I’ve said that for years but Carryfast is convinced British rail are nicking all the work because of fuel.
kr79:
If your limited and it goes ■■■■ up you don’t lose your shirt.
In theory yes, but in practice almost every time you get credit as a limited company the directors will have to personally guarantee it. That was the case with me for both fuel cards, the overdraft on the business account and even the finance on the insurance I had in the first year to spread the cost when I was starting up…
Paul
I think that is more of a modern thing though as when I had a tipper in 2005 I got two fuel cards no problem no guarantees or bonds.
When I started last year all the cards wanted between 3 and 5 k as a bond. In the end I just used my credit card. Better payment terms and shopping round could usually match what people on here were posting at the time for there card price.
Carryfast:
If fuel duty and VAT were removed together
Fuel duty and VAT have nothing to do with it, at least not in the area I was working in. I agree it will be different in the south and on general haulage though.
In the bulk tipping game the issue is simply one of supply and demand. If fuel duty was abolished then within a month everyone would have run round rate cutting to try and get more work and the result would be earnings after fuel back exactly where they were before. Anyone who thinks a duty reduction knocking a few hundred quid a week of the fuel bill will result in a few hundred quid more profit is a fool.
Paul
I think you’re underestimating the effect which knocking a ‘bit’ more than just a ‘few hundred quid’ off the fuel bill of the average long distance/uk-european operation,which the removal of fuel duty and the VAT levied on that duty would do,to the economic viablity of long distance operations from the customer’s perspective.The flaw in your calculations is that you’re looking at the situation as at present levels of demand without factoring in a probable increase in demand which would reflect the decrease in fuel costs being charged for the service.Therefore it isn’t just the decrease in fuel costs which would at least make fuel costs less as a proportion of revenues earn’t it would also create an increase in demand thereby creating more work.
The resulting growth of traffic in the uk-europe haulage sector would also create a knock on effect in regards to capacity levels regarding owner drivers doing local/uk work because it’s obvious that there are probably many owner drivers in that local/domestic sector who’d probably prefer to be doing longer distance international work if only the economic viability,in regards to at least the fuel taxation regime,was changed to make doing that more favourable.It’s also obvious,that the benefits of getting rid of such ridiculous levels of fuel taxation,would only be realised ‘if’ something is done about the issue of east european operators carrying uk imports and exports bound to and from western europe.
However that wouldn’t fit the government’s script in regards to an obvious policy concerning making long distance road transport an increasingly less attractive economically viable choice from the point of view of customers and making eastern europe richer at the expense of the western european economies.In view of which and without any change in that government policy my view is that CM doesn’t seem to living in the real world regarding future demand for owner drivers within the industry,Rob K seems to have a reasonable case,and therefore even if I was planning to start up I’d be out for at least the foreseeable future.
Although having said that I would have liked to have tried it as I’m sure I could have made it work as things stood in the uk-europe owner driver sector,during the early-mid 1980’s,in a more favourable fuel cost environment and without the east european competition.Ironically it was start up capital that stopped me then while it would be the economic viability of the operation which would stop me now.Being that I can’t see any case for risking the capital investment required in such a hostile road transport environment most of it caused by government policy in it’s wish to shift freight from road onto rail.
Carryfast:
I think you’re underestimating the effect which knocking a ‘bit’ more than just a ‘few hundred quid’ off the fuel bill of the average long distance/uk-european operation,which the removal of fuel duty and the VAT levied on that duty would do,to the economic viablity of long distance operations from the customer’s perspective.The flaw in your calculations is that you’re looking at the situation as at present levels of demand without factoring in a probable increase in demand which would reflect the decrease in fuel costs being charged for the service.Therefore it isn’t just the decrease in fuel costs which would at least make fuel costs less as a proportion of revenues earn’t it would also create an increase in demand thereby creating more work.
Whilst I’m sure you’re right in that lower transport costs would to a certain extent fuel demand, I disagree that you would then see better profit margins in haulage, as I would expect as soon as profit margins increase so will fleet sizes and the number of ODs and that will then bring rates back down.
IMO whatever happens, within reason, to fuel (and other) costs, and demand, the market will always settle roughly where it is now at the point where people can earn enough to stay in business and (if they run their business well) make a small profit but no more than that.
Carryfast:
I think you’re underestimating the effect which knocking a ‘bit’ more than just a ‘few hundred quid’ off the fuel bill of the average long distance/uk-european operation,which the removal of fuel duty and the VAT levied on that duty would do,to the economic viablity of long distance operations from the customer’s perspective.The flaw in your calculations is that you’re looking at the situation as at present levels of demand without factoring in a probable increase in demand which would reflect the decrease in fuel costs being charged for the service.Therefore it isn’t just the decrease in fuel costs which would at least make fuel costs less as a proportion of revenues earn’t it would also create an increase in demand thereby creating more work.
Whilst I’m sure you’re right in that lower transport costs would to a certain extent fuel demand, I disagree that you would then see better profit margins in haulage, as I would expect as soon as profit margins increase so will fleet sizes and the number of ODs and that will then bring rates back down.
IMO whatever happens, within reason, to fuel (and other) costs, and demand, the market will always settle roughly where it is now at the point where people can earn enough to stay in business and (if they run their business well) make a small profit but no more than that.
Paul
I think the difference between the amounts of uk based owner drivers,who seemed to be able to make a reasonable living,doing uk-international work,during the early-mid 1980’s,compared to now,shows that something has changed big time since then.I think we can safely say that the biggest factors in that situation have been the issues of fuel costs and east european competition for the same uk-west european work.It’s not a case of looking for big profit margins it’s more a case of economic viability which would cover at least a reasonabe wage for the job after all the overheads have been taken out.Therefore it’s more a case of the survival of the small owner driver operation not big profits being that very few employed or owner drivers have ever entered the industry with the idea that the job would make anyone very rich.It’s that issue of survival that would stop me,not the one of big profit margins which have never been a factor in the survival and long term,sustainable future of an owner driver type operation.
repton:
IMO whatever happens, within reason, to fuel (and other) costs, and demand, the market will always settle roughly where it is now at the point where people can earn enough to stay in business and (if they run their business well) make a small profit but no more than that.
^^^^^^ THIS sentence sums it up perfectly and is why it totally confuzzles me why people think that being an OD truck operator is a good idea. There is just no point to it at all. You make more-or-less the same money you would make as an employed driver, but with a whole ■■■■ ton of hassle, red tape, expenditure and investment all for absolutely NOTHING other than having your name on the side of the truck and faux illusion of being your own boss. To my mind that is NOT a business, it’s a mug’s game. I just don’t get why anyone of stable mindset would ever think that that is a good business plan? If you’re in some specialist area with specialist equipment where you can sit on your arse and charge out at £100/hr for your crane or something like that, then yeah, THAT’S a sound business plan and I’d tell you so and wish you all the very best, but most of the people in these threads who spend all their time arguing with me are on traction work for box companies and general hauliers pulling for peanuts and chasing their arses all day just to cover their running costs.
If there was no up front investment needed to start up then being able to “pay yourself a wage plus a little on top” would be acceptable for a fledgling business just starting out but just meeting VOSAs cash reserves, buying a cheap tractor unit, insurances etc will see you well into 5 figures before you even turn a ■■■■■■■ wheel yet somehow it’s acceptable to only earn “a wage plus a little bit on top” for all that investment?! What the actual ■■■■ are you clowns on?!! It’s beyond laughable. One can only assume that you have the collective business acumen of a foot stool or you’re simply doing it for the lifestyle and no interest in making any decent amounts of money - you know, like businesses are meant to do, not just bumble along year to year with your customers dictating what they will pay you?
Harry, you’ve been enjoying yourself recently, trying to get a rise from me without success, but how about we turn the spotlight back on you? Lost your job but despite living in the highest paying area of the country for driving work you remained unemployed for over 2 years and repeatedly whined on here that there were no jobs in your area so decided the way to solve that problem was to set up as an OD! I am sorry, but WTF? So out of all the places you’ve been and all the people you’ve worked for and become friends with over the years, absolutely NONE of them could point you in the direction of some work or even provide with you some? I don’t buy it. You could’ve quite easily spent a day or two going round the hauliers in your area dropping a card in and making yourself available as s/e and I’m willing to bet £50 that you’d have had a foot in the door and some keys in your hand within a week with them happy to pay the tenner an hour (eg.) you’re charging. I’m also willing to bet that you could be sat here today earning the same money from just offering your driving services as you are earning from being an OD with none of the hassle or investment, so you’ll forgive me for not taking your comments about the rights and wrongs of making money from being an OD too seriously either.
Some people will never understand the difference between the relatively small investment needed (not forgetting that the reserve capital requirement doesn’t mean actually spending that money) to set up as an owner driver as opposed to starting up a haulage company,which in a better more road transport industry environment would be worth every penny for the difference it makes,between the type of job and work opportunities available to subbies,which will never be available in the case of employed drivers.Which is the relevant comparison not the one of wether an owner driver operation makes so called ‘business’ sense or not.Because the aims and expected levels of income/reward of the two types of endeavor (running a business of whatever type) (as opposed to owning and driving a tractor unit to pull trailers on a sub contract basis) are totally different.
The fact is,were it not for excessive road fuel taxation and over capacity issues,(which are mostly a result of third country east european and rail freight competition for uk-west european haulage work and government policies to promote same), then the idea of working as an owner driver,(not with the aim of getting rich running a business),but just working as a driver,in just the same way as if it was an employed job,but with the bonus of a (much) better choice and availability of work and totally different management structure and probably better returns at the end of the day,would work out just fine.If that wasn’t the case there would never have been any such thing as owner drivers.
Even in the 80s and 90s rates for owner drivers doing Europe were probably lower than the should running with a belly tank full of red and with a wallet full of moody plastic was how most made a good living at euro work.
The tipper business was the same all the owner drivers I know who made good money was from fly tipping and buying tickets for imaginary loads of digger drivers
Carryfast:
Some people will never understand the difference between the relatively small investment needed (not forgetting that the reserve capital requirement doesn’t mean actually spending that money) to set up as an owner driver as opposed to starting up a haulage company,which in a better more road transport industry environment would be worth every penny for the difference it makes,between the type of job and work opportunities available to subbies,which will never be available in the case of employed drivers.Which is the relevant comparison not the one of wether an owner driver operation makes so called ‘business’ sense or not.Because the aims and expected levels of income/reward of the two types of endeavor (running a business of whatever type) (as opposed to owning and driving a tractor unit to pull trailers on a sub contract basis) are totally different.
They’re not totally different at all! The aims of both should beexactly the same. Regardless of whether you choose to be a 1-man band OD or a fully fledged haulage co. you still have the exact same basic set up costs for the business and per truck. If you choose to run more than 1 truck then your costs increase x how many trucks you have, with the exception of insurance (and possibly something else I’ve overlooked).
You can try to dress it up however you want but the bottom line is that it makes no financial sense whatsoever to spend a small fortune on kit and the capital reserves, deal with all the hassle and red tape on a daily basis to only make a wage and a bit more on top. This is why the only people still doing it are either a) V8-wannabe bling boys with their name on the door who don’t care about the money, b) old-timers that are stuck in their ways/don’t know any other trades and cling on in desperation “hoping it’ll get better soon” or c) they are financially inept, or d) all of the above.
really enjoy reading robs posts, its really unhealthy the amount of time effort he puts into these posts to discourage potential O D.
Everyone knows the answer to that one. It was Stobbard’s, obviously. 
One can only assume that you have the collective business acumen of a foot stool or you’re simply doing it for the lifestyle and no interest in making any decent amounts of money - you know, like businesses are meant to do, not just bumble along year to year with your customers dictating what they will pay you? 
I am sorry, but WTF? So out of all the places you’ve been and all the people you’ve worked for and become friends with over the years, absolutely NONE of them could point you in the direction of some work or even provide with you some? I don’t buy it. You could’ve quite easily spent a day or two going round the hauliers in your area dropping a card in and making yourself available as s/e and I’m willing to bet £50 that you’d have had a foot in the door and some keys in your hand within a week with them happy to pay the tenner an hour (eg.) you’re charging. I’m also willing to bet that you could be sat here today earning the same money from just offering your driving services as you are earning from being an OD with none of the hassle or investment, so you’ll forgive me for not taking your comments about the rights and wrongs of making money from being an OD too seriously either.