Many commercial drivers dream of the day they become an owner operator instead of simply making money for someone else. If becoming an owner operator is a goal of yours, then you probably also anticipate being able to make your own schedule as well.
The journey toward actually reaching this goal may seem too complicated for many to achieve but with a little bit of focus and hard work, the benefits of being an owner operator could be yours sooner than you would think. The process is easiest for drivers who have already had a few years of experience behind the wheel. While driving truck for someone else, you are gaining a more complete understanding about each part of the trucking industry, and this understanding is what is sure to help you succeed in your goal.
One Step at a Time
Though the process may seem daunting, drivers who are willing to take one step at a time and realize that each step is imperative to the end goal become owner operators sooner than most would have thought possible. Following are five steps that can lead you to your goal of ownership.
- Important Numbers – The first step you need to take is to get a registered with the Federal Motor Carrier Safety Administration (FMCSA) and get a USDOT number. This number will be used to identify and collect information about your safety information. This information includes any compliance reviews, inspections, data collected in audits and crash investigations. Once you have a USDOT number, You will need to request an Interstate Operating Authority (MC number). The kind of operating authority you need will depend on the type of cargo your plan to haul. There is a one-time fee to get a MC number from the FMCSA.
- Understanding Authority – By registering through the Unified Registration System (URS), you will be able to get our trucking authority in 20-25 business days. You will need to have your insurance company provide proof to the FMCSA that you have liability coverage.
- Insurance – You may think, while looking at insurance for your truck, that it is just in case of vehicle accidents. Understanding owner operator insurance requirements is something that you need to fully understand before moving forward in the process. Truck insurance is very different than simple auto insurance as it protects not only the owner, but also covers any loss of load or other assets. Certain kinds of insurance coverage are required by the FMCSA depending on what you plan to haul. Some types of freight, such as hazmat loads will require very different insurance than standard loads. The average insurance cost for an owner operator with one truck varies from an average of $8,000 – $12,000 per year.
- Lease or Own – One of the most difficult decisions, when considering becoming an owner operator. One of the biggest reasons that you might want to consider leasing a truck is that commercial trucks cost a lot! A decent used truck can cost anywhere from $60,000 to $100,000. Some leasing companies, however, do provide the option of leasing to own. This means that each lease payment gets you a step closer to ownership without having to pay the whole cost up front. If you decide that this is the right option, you may be required to haul for the leasing company, as well as find your own loads.
- Understanding Load Boards – Finding loads is one part of owning that many drivers do not get much experience with until they become owner operators. Thankfully, technology has made this process much easier than in the days when owners had to make phone calls looking for loads. The internet has many websites called load boards which are dedicated to helping owner operators find loads. Some of these boards are free, while others require a monthly membership fee for brokers and carriers. Even more convenient is the fact that many of these job boards have easy-to-use apps that can make grabbing the next load on your smartphone or tablet a breeze.
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Crunch the Numbers and Take the Leap
Taking a look at each step in this process before actually making the step can help you understand the costs of setting up as an owner operator. Make sure you factor in other costs that you will be faced with as the truck owner, so you will have a realistic view of how much money you can actually make. These costs, known as average operating costs are often calculated and called the cost per mile. You should include anticipated costs for fuel, vehicle repairs and necessary services, fees, taxes and a savings account that will help with any unexpected occurrences.
Though the process could take you several months, you will realize who worthwhile the work has been once you begin seeing the earning potential that is available to truck owners. Stop dreaming about being your own boss and take the leap as you change your life, your family life and your career for the better.