I decided to share this article written by Bill Cameron in Truck News as he hits on some really great business tips for Owner Operators and drivers in general. Sean: I’ve written in the past that I think driving school practices and commercial driving exams should have a serious overhaul. I think this revamp should include a math test. It seems far too many truck drivers, despite possessing other admirable skills, just can’t add.
This issue is more apparent at a smaller carrier, because we have more personal contact with our drivers and owner/operators. I’ve preached for years that truck manufacturers should not be allowed to have their own lending divisions.
Far too many drivers have become owner/operators who, had they needed to present a business plan to a traditional lending institution, would still be company drivers. As a small carrier, I prefer to have a vacancy than a full roster of owner/operators with poor finance management skills.
Exhibit A is the recruitment ads seen in magazines and truck stops. Those that garner the most attention are the largest and most graphically impressive. Pay levels rarely matter. Drivers traditionally flock to the larger carriers, or those with shiny new equipment.
We have all seen drivers reject work with a perfectly good company with good equipment and home time, to work for another carrier that may pay less or offer less home time, but offered some splashy iron to drive.
Owner/operators are equally guilty, often leaning towards larger companies for the supposed job security. The last few years have exhibited the inconsistency of job security everywhere.
My advice: narrow your choices to a job description you like, then follow the money. We’ve all met that owner/op or driver who grumbles about making just enough money to survive, but refuses to consider changing jobs, or even the lanes they travel. There are drivers that will drive in any weather, in any traffic, but are horrified with the thought of changing jobs for their own betterment. I know of some small companies that still pay their owner/ops when the customer pays. These carriers usually don’t have fuel cards either, yet licence and insurance costs are deducted either bi-weekly or monthly.
After spending their own cash on fuel for two weeks, it’s still possible for the O/O to be handed a negative paycheque, because nothing they’ve hauled over the past two weeks has been paid yet. Despite that, many of these carriers boast owner/operators who have been on staff for several years. Why?
Exhibit B is the attitude of some drivers that someone else will always take care of their bad situation. Recently, we’ve heard complaints from tri-axle dump truck owners working on the new Windsor Expressway. They don’t feel that $63 per hour is enough, and I completely agree. The problem is, these operators agreed to work for that. That rate was fine a year ago, but unacceptable now.
A similar scenario happened years ago, when owner/operators with large auto parts haulers went on “strike,” protesting insufficient fuel surcharges. The Ontario Transport Minister even got involved to negotiate for these poor souls who were supposedly about to lose their trucks, while those in other sectors thrived.
My opinion then was that all involved were fools. The Transport Minister was far removed from his duties, and as far as the owner/operators were concerned: quit your job, and your whining. If the car parts hauler were suddenly 20 trucks short, rates would increase. If not, there are hundreds of other jobs to choose from. If you are already behind on your truck payments, you really haven’t much to lose.
Exhibit C is those who are paid percentage, yet are still trapped in the mileage pay mindset. I once employed a capable yet argumentative person who was firmly in this category. He once unloaded at the bottom of West Virginia. When told his backhaul was near the top of the state, he angrily asked if there was nothing closer.
There was another load 40 miles away, but since it paid $50 less, I suggested that he travel West Virginia’s hills empty rather than loaded, and enjoy his extra $50. His response: “Okay, but dammit watch these empty miles!”
You can’t reason with someone so unaware of basic financial logic. Other owner/operators hate travelling to areas where backhauls are traditionally scarce or cheap. A good carrier will charge accordingly for the headhaul, so even with a bad backhaul, the revenue is still on target. Not nearly enough operators grasp this simple concept.
Exhibit D, still too common despite the recent economic situation, are those who still don’t understand fuel economy. Jobs change, admittedly, but how many are running relatively flat country with tandem trailers, in a truck with 600 hp? How much money is flying straight out the stacks? Many long-time flatbedders still have high-rise bunks, costing a minimum of three quarters of a mile per gallon. Do your own math on the annual cost of that.
The easiest way to explain someone else’s apparent success while you are floundering, is to assume the other person is just lucky. Success doesn’t come by following the status quo. The phrase that infuriates me most is: “We’ve always done it that way.” This industry is constantly evolving, so frankly, if this is your policy, you’re going backwards. Don’t be afraid to change your habits or employment, and get new batteries in your adding machine.
Start now to optimize your trucking business: