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Lipsey Trucking
In Blog

10 Steps to Becoming a Successful Owner Operator

Deciding between life as a company driver or an owner operator is a lot like the choice between renting and owning a house. As a company driver (renting), you have a steady job and expenses are relatively low. As an owner operator (owning), there’s much more reward for your work but more responsibility, and costs, come along with it.

Should you decide to become an owner operator, here are 10 tips to being successful.

Understand Your Costs

Trucks costs can vary greatly depending on your equipment, personal credit score, and fuel/maintenance programs, to name just a few factors. Unless you’re one of the few who can afford to pay for a truck with cash, you’re likely leasing a truck from another company. Lease costs can vary from $2,000 – $5,000 per month.

On top of that, maintenance costs are often unpredictable and immediate. If your truck breaks down, you don’t have a way to generate income.

Manage Maintenance Costs

If you’re unable to generate income, it will be pretty difficult to cover leasing costs and generate income. For that reason, you should be on the lookout for maintenance discounts and partnerships. What will new tires cost? What if your A/C goes out? What if you need a new inverter?

In addition, it would be wise to set aside several thousand dollars to handle unforeseen expenses. If you sign on with a company to run under their authority, you will likely be required to build an escrow account. Escrow accounts are like savings accounts, giving you an emergency stash of money to use when needed.

Regular PMs and inspections will help you avoid costly repairs down the road!

Take Care of Yourself

Life on the road can take a toll on your body. Human beings weren’t meant to sit for 10 hrs/day after all. In order to drive safely and efficiently, it’s important to maintain a healthy diet and find ways to get exercise on the road. That may be challenging, but it’s definitely not impossible! You may be surprised at some of the activities you can do from the inside of your cab. Great examples can be found here.

Minimize your fast food intake too. Poor diet can lead to poor sleep, which can impact your safety and performance behind the wheel. Oversleeping can mean you’re taking extended breaks and that means you’re making less money. After all, if you’re not driving, you’re not earning!

Be Safe

Unsafe driving can seriously hinder your ability to grow your business. Any DOT violation impacts your CSA scores and reduces opportunities for future revenue. Maintain your equipment in good condition with regular PMs and pre/post trip inspections.

Additionally, speeding may help you to get a load delivered faster, but it can also lead to license suspensions or worse, an accident. In either of those circumstances, you will lose your ability to generate income. Plan for the long term and drive safely.

Choose the right loads

Understanding how to find the “right” load can seriously impact your bottom line. Let’s break this into subcategories:

Markets

Which areas are best for inbound and outbound freight? Your goal should be to deliver into areas with a high demand for trucks. These areas will have more freight than available truck capacity can handle. That way, you’re being paid top dollar. “I just found a load that delivers to Bismark, ND for $8,000!” Well, you might make good money going there, but what’s your next move? Unless you have a dedicated customer to provide outbound freight, it’s likely that you will have to incur hundreds of miles of deadhead, with no revenue, to find your next load.

Pickup/Delivery Times

Does the load have strict appointments or is it a First-Come-First-Serve window? If it’s the former, you would be wise to determine whether or not you can make those appointments given (1) deadhead miles, (2) your available Hours of Service, and (3) any other load commitments you may have afterwards.

Understand Your Daily Mileage

The average truck driver runs 550 miles per day. The best loads will have distances that are roughly in that range so that you can get a full day’s work. If the lane is shorter than that, you will likely work fewer hours than you are able to run, which means you will generate less revenue than you are legally able to.

Watch Your Weight!

Heavier loads will increase your fuel costs and cause more wear & tear on your tractor. Aim for lighter loads when possible!

Load Boards

How do you find freight? Considering signing up for one of the load boards at companies like DAT (costs money), Truckstop.com (free), and J.B. Hunt 360 (free). Once you’re set up with a load board, you can build relationships with brokers on lanes that fit your needs. As you build those relationships, you can reduce the amount of time it takes you to find additional freight.

Manage Your Week

Plan accordingly so that you can maximize your drive time. Do you have any appointments that you need to hit? Remember that idle time is non-revenue time! Dedicated freight is your best friend in this area. Look for familiar routes and customers that you can run on repeat. Partnering with a dedicated carrier (such as Lipsey Trucking) will help you reduce uncertainties and give you the ability to manage your time and revenue generation better.

Understand Freight Cycles

Recognizing which parts of the country experience seasonality and at what times can help you take advantage of opportunities throughout the year. Positioning your truck in those markets that have a high demand for capacity will lead to increased revenue. Read about produce season, the Chinese New Year, Retail Season (or Peak Shipping) and Christmas Tree season, among a multitude of other seasons that impact freight rates.

Manage Money Flow

Rather than obsessing over rate per mile, as many drivers do, direct your attention to gross revenue. Focusing on the former is overly short sighted. Develop strategies to increase your weekly or monthly revenue.

Also take into account your expenses and the frequency of incoming payments. You might have weekly expenses but you may only get paid each month. (Fact: Lipsey Trucking pays our owner operators every Friday morning, guaranteed.) Manage your cash flow so that you can cover those expenses.

Maintain a Good Credit Score

Unless you have a few hundred thousand dollars sitting around, you will need to explore financing options in order to grow your fleet. A good credit score will allow you to purchase that next truck at a much, much lower price.

Factors Hurting Your Score

 Tips to Increase Your Score
Late bill payments Pay your bills on time and in full
Opening too many lines of credit too quickly Refrain from applying for too many credit lines too often
Using too much of your credit line

Only use up to 30% of your available credit

Equipment

To begin with, purchasing equipment in good condition will significantly impact your ability to earn throughout the course of truck ownership. It may cost a little extra up front, but if you’re constantly working through break downs, you will not be able to generate consistent revenue. Start with a quality truck.

In addition, regular PMs and pre/post trip inspections will help you get ahead of costly repairs and breakdowns. Remember that in those circumstances, not only are you having to pay for the repairs, but you’re also missing out on revenue from driving.

What other advice do you have for aspiring owner operators? Please comment below and tell us!

To learn more about Lipsey Trucking’s owner operator programs, you can email us at recruiting@lipseytrucking.com or call us at 423-701-7100. You can also read more on our Owner Operator page and begin the application process there!

 

Lipsey Trucking
In Blog

Company Driver vs. Owner Operator: What’s best for YOU?!

Thinking about purchasing a truck to start your own business? That’s exciting! After all, one of the perks of being a truck driver is the freedom of the open road. Purchasing a truck and become an independent contractor are steps to that sense of freedom to the next level.

The skills required to be a company driver are almost identical to those of being an owner operator.

So which is better for you? Everyone’s situation is different, so we’re here to help you understand the pros and cons of being either a company driver or owner operator in today’s trucking world.

Company Drivers are legal employees of the trucking company. They are typically provided a tractor, trailer, health insurance and other benefits that go along with working at a company. Pay is usually based on “Cents per Mile” or as a flat salary for those who may drive local.

Owner Operators are independent contractors who lease or own their own truck and run freight for a trucking company. They are typically paid a percentage per load and earn significantly more money than a company driver. However, their costs are also significantly higher than a company driver.

Ultimately, it comes down to what’s best for YOU! Read through the details below and contact us to learn more about opportunities at Lipsey Trucking!

Perks of Being a Company Driver

  1. Leave the job at the terminal! No need to take it home with you. When your shift is over, you can focus on the other important things in life. Your job starts and stops in the tractor.
  2. Just drive, baby! The most important quality in a successful company driver is safety. As far as your career goes, you have nothing else to worry about besides getting that load delivered safely.
  3. Money earned is money kept! No need to worry about truck payments, insurance costs, or any of the other things that go along with running a business. When you get that paycheck, you can do what you want with it. That money you earned is going straight to YOU and only YOU!
  4. Easy to change jobs! The trucking market has never been more competitive for drivers than it is today. Drivers have their pick of companies to run for. It’s easy and cheap to switch jobs when you’re a company driver.
  5. No startup costs! No money is required up front to get started. Once you’ve got your CDL, there are no other costs associated with starting a company driver job. In fact, most companies will give YOU a substantial bonus just for signing on with them! At Lipsey Trucking, new company drivers earn a $4,000 sign on bonus!
  6. Less stress! As we already mentioned, a company driver doesn’t need to worry about anything other than delivering that load safely and on time. Don’t worry about the bottom line or all of the other stress-inducing factors that could keep you up at night.

Cons of Being a Company Driver

  1. Less money. A typical company driver will bring home less money than an owner operator. An average company driver earns between $0.35 – $.50 cents per mile driver. (At Lipsey Trucking, our company drivers earn $0.49 – $0.60 cents per mile depending on experience and home time needs). Depending on the type of lanes and business that a company driver is running, annual pay could range from $40k to $85k per year.
  2. Less independence. As an employee of the company, you’re expected to go where the company needs you to go. Hopefully all of that has been agreed upon in advance of you beginning employment, but at the end of the day, it’s up to company to determine your lanes.
  3. Less home time. Keep in mind that when the company’s truck isn’t driving, it’s not making money. Even if that truck is sitting still, the company still has to pay for it each month. Therefore, they may push you to stay out on the road more often. (At Lipsey Trucking, we honor our initial agreement with you in regards to home time. If we agree for you to go home every weekend, that’s what we’ll do).
  4. No choice on equipment. The company likely has an agreement in place with one of the major truck providers. They choose whether the truck is automatic or manual and what speed they are governed at.

Perks of Being an Owner Operator   

  1. Higher Pay! Owner Operators, or independent contractors, earn significantly higher pay than your typical company driver. An average owner operator can expect to gross $150,000+ per year. (At Lipsey Trucking, a typical owner operator earns around $250,000 per year). As an independent business owner, you should be grossing over twice what a company driver makes.
  2. Choose your equipment! Do you prefer an automatic truck or are you the “old-school” type and enjoy a manual? Either way, it’s entirely your choice! You pick your truck and design it the way that you want it. After all, the truck is your home!
  3. Freedom! Owner operators can choose how they want to run their days. As an independent contractor, you can run when and where you want. At Lipsey Trucking, we offer an Agent program that allows owner operators to find and book their own freight. Then we’ll handle all of the back office functions to make sure you get paid accurately and on time.
  4. Time Off! You can take as much time off as you need to. You can take as much or as little vacation as you’d like!

Downsides of Being an Owner Operator

  1. Higher Costs. Though you are taking home more money, you’re also paying more out of pocket for maintenance and other needs. Some of the biggest costs of owning a truck include
  • Fuel
  • Maintenance
  • Tires
  • Health Insurance
  • Liability Insurance
  • Breakdowns

These costs are often unpredictable and unavoidable. In order to reduce some of these costs, it’s important that owner operators keep their truck in good shape, regularly performing inspections to stay ahead of expensive breakdowns. After all, if the truck breaks down while on the road, not only is there the cost of fixing the truck, but a broken down truck is also not making any money.

  1. Financial Risk. Things happen in trucking that are often out of anyone’s hands. Between breakdowns, accidents, delays, and other unpredictable events, there is the risk of being suddenly slapped with a large expense. Owner operators should have sufficient cash in savings to cover themselves when these things happen.
  2. Time off. But wait, wasn’t this one of the perks? Yes! The downside is that even though the truck isn’t earning any money while on vacation, those truck payments are still due. It can be tempting to only work a few days each week as an owner operator, but at the end of the month, you will still owe the bank for your truck (unless you’ve purchased it outright).
  3. Administrative/record keeping. There’s a lot of work that happens behind the scenes to make sure everyone is paid accurately and on time. As an independent business owner, it is difficult to manage accounting and safety while you’re behind the wheel of your truck. At Lipsey Trucking, we handle all of those needs on your behalf. If there is accessorial pay due, such as detention or layover, we will negotiate that for you and reimburse you 100% of what you’re owed.
  4. Start up costs. It requires a large amount of cash to purchase a truck and all of the amenities that you will need to live in it. The tractor alone will cost upwards of $100,000.

Ultimately, it’s important to realize pursue that driving lifestyle that fits your needs the best. Every person is different and deserves a job that fits their lifestyle the best!

You can email us at recruiting@lipseytrucking.com or call us at 423-708-7100 to learn more about our available company driver and owner operator positions.

Lipsey Trucking
In Blog

7 Tips for Building Great Driver Relationships

You know what makes a great trucking company? Great drivers. No matter how much technology you have, it is useless if there are no people to operate the vehicles or trucks and get them from point A to B safely. It doesn’t mean they need fancy offices with games and TVs in order for their employees to enjoy themselves while on break; all that matters is having good workers who take pride in doing well at this job as opposed to just showing up every day because of necessity or duty like soldiers going off into battle without question.

To thrive as an organization, you first must jive with your drivers. Here are seven tips for making your drivers feel like they are a part of the family.

  1. Listen: It’s the simplest of the seven, yet often the most overlooked. Being out on the road so much is challenging. Oftentimes, the best thing that you can do as a dispatcher or operations manager is to simply be someone who listens to them. Sometimes the only people they talk to throughout the day are the gatekeepers at the shippers and receivers where they pick up and deliver.

 

  1. Get to know them as people: Nobody wants to be another number on a spreadsheet. Ask about their families and what they do when they’re not on the road. Why did they become a truck driver? Perhaps they have a family history in the industry? Maybe they wanted to see the country? Everyone’s different and has their own set of needs and expectations.

             *Some folks want to shut up and drive! Respect their style if that’s how they want to operate!

 

  1. Maximize their miles and hours: For most driving jobs, they earn their pay based on their total miles driven. It is the dispatcher’s responsibility to provide the correct routing and time management to help the drivers work as efficiently as possible. Becoming an expert on HOS rules is the first step to becoming the partner your drivers deserve.

 

  1. Gain Trust: It starts with honoring your commitments to your team. Failing to uphold your end of the bargain, whatever that may be, damages the relationship and, if done enough, will create irreparable damage. Taking that a step further, be careful not to make commitments that will be impossible or nearly impossible to keep.

 

  1. Get them home when they want to be home: As we mentioned already, every driver, just like every person, is different. Some want to be home nightly, some weekly, some monthly, and some prefer to live their life out of their cab. To those who value home time, give it to them. One of the top reasons drivers leave a company is due to break home time guarantees. Everyone is vulnerable to burnouts.

 

  1. Communication/Transparency: No one likes to have orders barked at them. At the same time, every job will have its requirements that are less than ideal. When making difficult requests of your drivers, help them to understand the context behind the request. Explain the circumstances and the big picture. After all, they’re a part of the team and empowering them to make decisions can make everyone’s job easier in the long run.

 

  1. Recognition of a job well done: Give credit where credit is due! These incredible people work long shifts and tolerate terrible drivers when out on the road. A simple “THANK YOU” and “GREAT JOB” can go a looooooong way! Give them a gift card for a free nice dinner, a night in a hotel, a simple phone call from an executive, or, heck, maybe some new rims for their ride (if that’s what they want) could turn that driver into one of your most loyal team members.

Great trucking companies are comprised of great drivers. Treat them as you’d want to be treated yourself and watch your fleet grow.

 

Lipsey Trucking
In Blog

Lipsey Trucking Joins the Freight Trucking, Inc. Family

Freight Trucking, Inc. announces the acquisition of Lipsey Trucking, the asset division of Lipsey Worldwide. These assets will serve as the dedicated truckload division of Freight Trucking, where the focus will be on improving services and technology for new and existing customers and team members. Lipsey Trucking will be the benchmark division of a growing transportation company.

Founder and Principal, John Bowes, made the acquisition in early 2021 with the intention of providing dedicated truckload services to customers throughout the United States. Having successfully served as CEO of Xpress Global, formerly a division of U.S. Xpress, from 2005-2015, he helped execute the successful purchase of his company to a Private Equity group. He was one of the first four employees of FreightWaves, helping to launch the company from the beginning.

“Lipsey Trucking had a reputation for great employees and top-notch drivers. It was important to bring on good people as we set the culture and attitude to grow this organization. Great companies start with great people and I couldn’t be more excited for what we will build together. It’s going to be fun.”

Existing operations throughout Ohio will expand and the company will also launch a new hub in the Chattanooga area, providing dedicated services throughout the Southeast Region.

The team is looking to add more drivers and office staff immediately. To view open positions, visit www.lipseytrucking.com.

Lipsey Trucking
In Blog

Diversity and Inclusion Statement

The recent events in Minneapolis, coupled with many other tragic and disturbing similar scenarios of racial discrimination, are tragic and heartbreaking for our Country and her people.  And despite the progress and the sacrifices made by so many who have fought and continue to fight for equality, many of our fellow Americans are denied compassion and decency due to the color of their skin.  While many Americans will never truly understand what many Americans of color experience, Lipsey Trucking will remain committed that our company will continue to support our diverse culture and communities we live and work in.

Lipsey Trucking believes in the values of diversity and inclusion.  We believe in the diversity of ideas, beliefs, and experiences and the inclusion of people regardless of their race, color, sex, language, national origin, religion, sexual orientation or age.  Racism, hatred, and inequality have no place in our businesses, communities, and country.  We must all do better.

We must all be better.

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