Admin
April 14th, 2005, 20:10
This is the fourth of five articles written to assist you in considering expediting as a career.
Choosing an Owner
Expedited truck Owners are individuals, groups of individuals or organizations that provide trucks and drivers to various size expedited carriers. Truck owners contract with various carriers and receive payments for the services their drivers and trucks provide to the carrier. Payments to the owners vary from carrier to carrier and are paid by mileage and or a percentage of the revenue charged to the carrier’s customer. The expedited truck owner generally contracts with his drivers to split the revenue in set percentages. The vast majority of these arrangements place the driver in an independent contractor status for all employment considerations. Those who do not use the percentage basis, generally pay the drivers for the services on a cost per mile basis.
Individuals, limited liability companies and corporations who engage in this portion of our particular niche of the trucking industry, operate in general with the personalities of those involved. This having been said, understand that there are no set rules or arrangements for these owners as a group, and that the treatment of drivers by these owners is as varied as the personalities of the general public.
Having selected the carrier that appears to best suit your driving desires, this selection is now the most important decision remaining for you. Whether you choose an individual or an organization you should consider the owners and their history in our industry. All owners have invested in equipment for the sole purpose of making as much money as possible. Some owners see you, the potential driver as a means to collect revenue and care very little about your financial obligations, your family life, your goals and desires.
Their expectations are paramount and your contentment is of little concern. It is simply a business to them and you will either fit into their plans providing what they demand or you will be replaced. These are the owners you should avoid if at all possible. Their shortsighted abilities to see that the arrangement of owner and driver is the key to their ultimate goal, is in fact self defeating and much less profitable than the owners who understand that the best arrangements take the driver’s needs into consideration.
There are many ways to find owners. Expedited carriers normally have a list of owners who are presently seeking drivers. Recruiters for these carriers should be able to provide several owners phone numbers. This is a logical place to begin. Other options include the classified section of Expediter World and other expedited specific sites, as well as your nearest truck stop where you can meet a variety of expedited drivers. Owners have an obligation to themselves and their potential drivers to screen the applicants well, and try to assure themselves that the drivers they select will understand their specific method of operation and will fit into their program. The driver’s obligation is to be truthful with the owners, explain their driving requirements and to make certain the owner understands their specific needs.
Owners who expect a reasonable return on their investments generally treat their drivers with respect, pay ontime and fairly, have an interest in keeping their drivers happy and tend to maintain their equipment. Owners looking for the maximum return on their investments often find ways to cut expenses and unfortunately some owners consider the driver as an expense, and repairs as unnecessary. Tactics such as these can be discovered by asking for references from present and past drivers.
A professionally written contract is a must for you the driver, and should be offered by the owner in advance for your private reading. Owners that do not have a contract should be avoided. Most professional owners have a contract which has been prepared by an attorney, clearly and legally stating all facets of the agreement. The contract should specify the specific unit you will be driving, the equipment on board, what is expected of you, which expenses you will be responsible for, when you will be paid, how you will be paid and the method of payment. The contract should also state if an escrow is required, who is responsible for routine maintenance, incidental costs, insurance costs, workers compensation or accidental health insurance, Qualcomm expenses and should state how the contract can be terminated to insure the return of your escrow. Poorly written contracts without the above information could be a red flag signaling to you that you are not dealing with a reputable owner. There are exceptions to this rule, but why take a chance? Your income and future depend on making wise decisions and getting everything in writing only strengthens your position.
Most reputable owners pay the drivers the agreed percentage or flat rates per mile, and agree to pay all expenses regarding the maintenance, insurance, Qualcomm monthly fees, and incidental costs of the operation of the truck. Owners paying by percentages normally pay the drivers 60% of the revenue the truck earnings, and require that the drivers pay for fuel and tolls only. Some owners offer the drivers up to 40% of the truck earnings while paying all expenses including fuel and tolls. Either arrangement seems at first glance to be fair and equitable, but a closer look must be taken. Some owners ask that you pay as much as 50% of the insurance charges, the weekly Qualcomm fees, oil changes, and minor repairs. Contracts written with these provisions lead me to believe that the owners are of the “maximum profit” mindset and are taking advantage of drivers’ inexperience.
There are an abundance of reputable owners that are in this industry. Most are honest and treat their drivers as a valuable commodity while you are driving for them. Others may realize your value only when you attempt to terminate the contract. Your responsibility to yourself and your family is to find the best possible arrangement, with an open honest owner. Be leery of those whose contracts are vague, poorly written and leave the responsibility of certain expenses unstated. Assume that if an expense is omitted from the contract, it will indeed become yours. Avoid handwritten contracts that fail to cover even the most basic of details. I have seen one contract copied so many times that it was illegible. This contract called for two weeks advance written notice. If the truck was not under load for the majority of time after notice, the drivers forfeited his escrow and pay would be withheld for the runs he did complete. My point here is even though this example in not enforceable by any court, who has the time, energy or the dollars needed to take this particular dishonest owner into court? Be careful what you sign and understand that no owner has the right to withhold agreed to wages for any reason. If you drove and earned income, the owner must pay you, even if you owe the owner additional escrow or have borrowed money from them.
Aside from the contractual agreement and your full understanding of the owner’s expectations, how can a potential expedited driver be certain that an owner is reputable?
Expect the owners to interview you, check out your driving history, your criminal record, and your previous employment record including any and all information they can secure from previous employers. You have the obligation to yourself and your family to be just as vigilant in your selection. In your own words with concern and respect, you should prepare your own interview of the owners. Ask question regarding expenses, pay, expectations of time on the road, fuel surcharges, trucks available, and in general how involved the owner will be in your day to day activities. Some owners are available to their drivers around the clock, while others have virtually no contact for weeks at a time. There is neither a correct nor suggested amount of owner participation in the day to day operation of these trucks; however there will be specific incidents where your truck owner will want notification. Examples of these times could be maintenance issues, repairs and mileage production. Your truck owner will be able to access information regarding the percentages of “in service” and load rejections and may want to discuss these issues on a regular basis.
If the contract appears to be fair, the equipment is acceptable and you are considering this owner as your selection, your next step is to check the owner’s reputation. While the carriers may not give you direct information, be clever enough to ask questions regarding the owner’s standing within the organization in a manner that will allow the carrier to help you make a decision. How long has the owner had trucks with this carrier? How many drivers have they had for this particular truck? Have former drivers remained with the carrier and left this driver? Finally a knowledgeable carrier representative may answer a question like the following, “Knowing what you do about this owner, would your choose to sign on or would you choose another owner?
Additionally present and former drivers can be an excellent source of information. Your prospective owner should be willing to provide present and past drivers who can vouch for their honesty, expectations, demeanor and general working arrangements. They can tell you if their pay is accurate, how they are paid and if they are paid ontime. Past drivers can vouch for all of the above and inform you of the return on their escrow. Once you have contacted the drivers provided by the owner, ask each of them if they can give you another driver that you can contact. They may put you in contact with a former driver who would be more open with you. Remember that all drivers have personal opinions that may differ from the owners and try to remain objective in your analysis. If a driver makes an accusation regarding an owner’s decision and that issue is of interest, question the owner about his reasoning. There are two sides to every story.
Questions for the drivers should center on pay, deadhead recommendations, fuel surcharges passed on by the owner, in service requirements, on time settlements and truck maintenance. Other questions for the drivers are owner contacts and reports, in service time expected and home time allowed. For some reason many drivers do not keep records as accurately as they should, but each of them should be able to tell you their gross pay on an annual basis, and by asking the proper questions you should be able to determine your expected net income.
If you are new to the industry, you may wish to attempt to find an owner with an active interest in your daily travels. This kind of owner will already have a good understanding of the carriers traffic lanes, where and when to be patient, and where and when to move to another area. An active owner will do his best to assist you in maximizing your income with a vested interest. The more money you earn, the more the owner earns. Long term and professional owners will take as much time as necessary to assure that you are happy with the arrangement and income, and will assist you with daily decisions that should be of benefit to you.
Choosing an active, responsible and honest owner will give you the best chance for success as an entrant into the expedited industry. If after reading this series of articles, you are still insistent on owning your own truck, the next article summarizing the prior articles will contain additional information for those wishing to enter as an owner/operator.
Next...Setting goals, budgeting, truck buying and summation.
Choosing an Owner
Expedited truck Owners are individuals, groups of individuals or organizations that provide trucks and drivers to various size expedited carriers. Truck owners contract with various carriers and receive payments for the services their drivers and trucks provide to the carrier. Payments to the owners vary from carrier to carrier and are paid by mileage and or a percentage of the revenue charged to the carrier’s customer. The expedited truck owner generally contracts with his drivers to split the revenue in set percentages. The vast majority of these arrangements place the driver in an independent contractor status for all employment considerations. Those who do not use the percentage basis, generally pay the drivers for the services on a cost per mile basis.
Individuals, limited liability companies and corporations who engage in this portion of our particular niche of the trucking industry, operate in general with the personalities of those involved. This having been said, understand that there are no set rules or arrangements for these owners as a group, and that the treatment of drivers by these owners is as varied as the personalities of the general public.
Having selected the carrier that appears to best suit your driving desires, this selection is now the most important decision remaining for you. Whether you choose an individual or an organization you should consider the owners and their history in our industry. All owners have invested in equipment for the sole purpose of making as much money as possible. Some owners see you, the potential driver as a means to collect revenue and care very little about your financial obligations, your family life, your goals and desires.
Their expectations are paramount and your contentment is of little concern. It is simply a business to them and you will either fit into their plans providing what they demand or you will be replaced. These are the owners you should avoid if at all possible. Their shortsighted abilities to see that the arrangement of owner and driver is the key to their ultimate goal, is in fact self defeating and much less profitable than the owners who understand that the best arrangements take the driver’s needs into consideration.
There are many ways to find owners. Expedited carriers normally have a list of owners who are presently seeking drivers. Recruiters for these carriers should be able to provide several owners phone numbers. This is a logical place to begin. Other options include the classified section of Expediter World and other expedited specific sites, as well as your nearest truck stop where you can meet a variety of expedited drivers. Owners have an obligation to themselves and their potential drivers to screen the applicants well, and try to assure themselves that the drivers they select will understand their specific method of operation and will fit into their program. The driver’s obligation is to be truthful with the owners, explain their driving requirements and to make certain the owner understands their specific needs.
Owners who expect a reasonable return on their investments generally treat their drivers with respect, pay ontime and fairly, have an interest in keeping their drivers happy and tend to maintain their equipment. Owners looking for the maximum return on their investments often find ways to cut expenses and unfortunately some owners consider the driver as an expense, and repairs as unnecessary. Tactics such as these can be discovered by asking for references from present and past drivers.
A professionally written contract is a must for you the driver, and should be offered by the owner in advance for your private reading. Owners that do not have a contract should be avoided. Most professional owners have a contract which has been prepared by an attorney, clearly and legally stating all facets of the agreement. The contract should specify the specific unit you will be driving, the equipment on board, what is expected of you, which expenses you will be responsible for, when you will be paid, how you will be paid and the method of payment. The contract should also state if an escrow is required, who is responsible for routine maintenance, incidental costs, insurance costs, workers compensation or accidental health insurance, Qualcomm expenses and should state how the contract can be terminated to insure the return of your escrow. Poorly written contracts without the above information could be a red flag signaling to you that you are not dealing with a reputable owner. There are exceptions to this rule, but why take a chance? Your income and future depend on making wise decisions and getting everything in writing only strengthens your position.
Most reputable owners pay the drivers the agreed percentage or flat rates per mile, and agree to pay all expenses regarding the maintenance, insurance, Qualcomm monthly fees, and incidental costs of the operation of the truck. Owners paying by percentages normally pay the drivers 60% of the revenue the truck earnings, and require that the drivers pay for fuel and tolls only. Some owners offer the drivers up to 40% of the truck earnings while paying all expenses including fuel and tolls. Either arrangement seems at first glance to be fair and equitable, but a closer look must be taken. Some owners ask that you pay as much as 50% of the insurance charges, the weekly Qualcomm fees, oil changes, and minor repairs. Contracts written with these provisions lead me to believe that the owners are of the “maximum profit” mindset and are taking advantage of drivers’ inexperience.
There are an abundance of reputable owners that are in this industry. Most are honest and treat their drivers as a valuable commodity while you are driving for them. Others may realize your value only when you attempt to terminate the contract. Your responsibility to yourself and your family is to find the best possible arrangement, with an open honest owner. Be leery of those whose contracts are vague, poorly written and leave the responsibility of certain expenses unstated. Assume that if an expense is omitted from the contract, it will indeed become yours. Avoid handwritten contracts that fail to cover even the most basic of details. I have seen one contract copied so many times that it was illegible. This contract called for two weeks advance written notice. If the truck was not under load for the majority of time after notice, the drivers forfeited his escrow and pay would be withheld for the runs he did complete. My point here is even though this example in not enforceable by any court, who has the time, energy or the dollars needed to take this particular dishonest owner into court? Be careful what you sign and understand that no owner has the right to withhold agreed to wages for any reason. If you drove and earned income, the owner must pay you, even if you owe the owner additional escrow or have borrowed money from them.
Aside from the contractual agreement and your full understanding of the owner’s expectations, how can a potential expedited driver be certain that an owner is reputable?
Expect the owners to interview you, check out your driving history, your criminal record, and your previous employment record including any and all information they can secure from previous employers. You have the obligation to yourself and your family to be just as vigilant in your selection. In your own words with concern and respect, you should prepare your own interview of the owners. Ask question regarding expenses, pay, expectations of time on the road, fuel surcharges, trucks available, and in general how involved the owner will be in your day to day activities. Some owners are available to their drivers around the clock, while others have virtually no contact for weeks at a time. There is neither a correct nor suggested amount of owner participation in the day to day operation of these trucks; however there will be specific incidents where your truck owner will want notification. Examples of these times could be maintenance issues, repairs and mileage production. Your truck owner will be able to access information regarding the percentages of “in service” and load rejections and may want to discuss these issues on a regular basis.
If the contract appears to be fair, the equipment is acceptable and you are considering this owner as your selection, your next step is to check the owner’s reputation. While the carriers may not give you direct information, be clever enough to ask questions regarding the owner’s standing within the organization in a manner that will allow the carrier to help you make a decision. How long has the owner had trucks with this carrier? How many drivers have they had for this particular truck? Have former drivers remained with the carrier and left this driver? Finally a knowledgeable carrier representative may answer a question like the following, “Knowing what you do about this owner, would your choose to sign on or would you choose another owner?
Additionally present and former drivers can be an excellent source of information. Your prospective owner should be willing to provide present and past drivers who can vouch for their honesty, expectations, demeanor and general working arrangements. They can tell you if their pay is accurate, how they are paid and if they are paid ontime. Past drivers can vouch for all of the above and inform you of the return on their escrow. Once you have contacted the drivers provided by the owner, ask each of them if they can give you another driver that you can contact. They may put you in contact with a former driver who would be more open with you. Remember that all drivers have personal opinions that may differ from the owners and try to remain objective in your analysis. If a driver makes an accusation regarding an owner’s decision and that issue is of interest, question the owner about his reasoning. There are two sides to every story.
Questions for the drivers should center on pay, deadhead recommendations, fuel surcharges passed on by the owner, in service requirements, on time settlements and truck maintenance. Other questions for the drivers are owner contacts and reports, in service time expected and home time allowed. For some reason many drivers do not keep records as accurately as they should, but each of them should be able to tell you their gross pay on an annual basis, and by asking the proper questions you should be able to determine your expected net income.
If you are new to the industry, you may wish to attempt to find an owner with an active interest in your daily travels. This kind of owner will already have a good understanding of the carriers traffic lanes, where and when to be patient, and where and when to move to another area. An active owner will do his best to assist you in maximizing your income with a vested interest. The more money you earn, the more the owner earns. Long term and professional owners will take as much time as necessary to assure that you are happy with the arrangement and income, and will assist you with daily decisions that should be of benefit to you.
Choosing an active, responsible and honest owner will give you the best chance for success as an entrant into the expedited industry. If after reading this series of articles, you are still insistent on owning your own truck, the next article summarizing the prior articles will contain additional information for those wishing to enter as an owner/operator.
Next...Setting goals, budgeting, truck buying and summation.