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August 20, 2019
The United States has a tremendous shortage of truck drivers despite a strong economy and increasing demand for shipping services. More and more people are purchasing products and goods online, increasing the demand for the shipment of products. But with an aging demographic of retiring truck drivers and no new drivers to take their places, there is no end in sight to the shortage of truck drivers. The American Trucking Association estimates that there is already a shortage of at least 50,000 truck drivers and that number is expected to grow.
As the demand for new drivers increases, so do wages offered by carriers. In 2015, the median annual wage of a truck driver employed by a private trucking company was $73,000, which is much higher than the overall average salary for individuals in the United States. Despite high wages, the shortage remains and difficult lifestyle is likely a key factor.
Difficult lifestyle is a factor in the driver shortage
Truck drivers often face a difficult lifestyle, due to a lack of home time and the significant amount of time spent away from family and friends. The lifestyle of a truck driver can be unhealthy because it requires you to sit for extended periods of time, while eating meals on the go. Some say there is a serious lack of respect for truck drivers and that they often face harassment from other drivers, police, and enforcement agencies. There is also a lot of stress on truck drivers to keep up with the ever-changing technology and rules of compliance. Aside from the potentially challenging lifestyle truckers can face, there are a host of benefits of becoming an owner-operator truck driver.
Benefits of getting into truck driving
Becoming a successful owner-operator is not likely high on the list of many youth, but it should be. For one, becoming a truck driver does not require a college degree. Obtaining a commercial drivers license (CDL) is straightforward and can be a relatively quick process. For students out of high school who are uninterested or unable to attend college, or for those who did not obtain a diploma, going into trucking is reasonable way to make a high wage. The earning potential in trucking is high, especially if you get on a track to become an owner-operator.
How to become an owner-operator
Becoming an owner-operator is challenging but poses a good opportunity for young people looking to start their own business. Below is a sample procedure for what it takes to become an owner-operator in trucking:
- First and foremost, you must gain experience in trucking before working to establish your own business. Learning the rules of trucking, compliance, regulations, and getting driving experience, takes time. Gain experience working as a company driver for a private fleet while earning a respectable salary.
- Next, and this may be the most challenging part, is to determine where your funding will come from. Do you have capital of your own to put towards ownership? Or are you going to take out loans and financing? Do you have good credit? Research your credit score, interest rates and fees before taking any action. Either way, you should develop a business plan that outlines your projected costs and strategies.
- Familiarize yourself with all current and coming federal regulations; such as the FMCSA ELD mandate.
- Acquire the basics: Apply for a US DOT number and Motor Carrier (MC) number, and obtain health and truck insurance coverage. Determine your business structure, and register your business, filing all appropriate paperwork.
- Use telematics as part of your strategy to keep costs and risk low.
- Fuel tracking - Gain insights into fuel economy and lower your fuel costs.
- Compliance - Automatically track HOS and DVIR, reducing the likelihood for violations for long haul drivers
- Fleet dash cams - Mitigate risk and potential reduce false claims
- Understand how to calculate your profits
Other types of ownership options
Becoming an independent owner-operator is probably the best route to profitably owning your own trucking business, but many drivers don’t have the equity upfront to make that dream a reality. There are other options for drivers to look into including:
- Lease operators
These drivers lease a truck from a freight company and continue to haul freight for that company. Essentially, you pay to lease the truck from the freight company and they pay you to drive it. This is typically considered a less profitable option, but for drivers looking to gain experience in the short term, it’s a good way to get started.
- Leased owner-operators
This option is best for drivers with experience who are looking for more control but don’t have the capital or credit to purchase their own truck outright. As a driver, you’ll lease a truck and then work hauling loads independently. Major considerations include health insurance and benefits provided by big companies. Profit is typically higher when you are a business owner, but if your lease rates are high and you have to pay high rates for insurance, you might consider sticking with a private fleet until you have enough equity to purchase a truck outright.
Why now is the perfect time to start your own trucking business
If you’ve been in trucking for some time and have been considering starting your own business, and being your own boss, now is a great time to take action.
If you have that business savvy, entrepreneurial spirit and experience in trucking, you may already know that the sky's the limit when it comes to profitability. And now, more than ever, drivers are needed to fill the growing shortage of drivers. The right person, with the right plan, has an opportunity in front of them to transform the trucking industry and to make a lot of money while doing it.