If you have been a company driver in the industry for a while the chances of you at least hearing the word “Owner Operator” or talking with some of these Owner Operators is pretty high. Have you thought about making the jump to being your own boss? Are you still not sure what exactly an Owner Operator is in the trucking business? Let’s look into a few of the details and help you determine which path might be the best for you.
What is an Owner Operator in the Trucking Business and How is it Different than a Company Driver?
The answer to this question is fairly simple. Owner Operators own their equipment. (hence the word “owner”) They are in charge of all aspects of their business from driving the truck, to having all of the paperwork ready and in place, to making sure the schedule is booked with the most efficient loads to get the bills paid.A company driver on the other hand is someone who has their CDL but doesn’t own any equipment. They drive a truck for a company and have their loads already booked and are simply in charge of driving the vehicle from one destination to the next.
What Are Some of the Pros and Cons of Being an Owner Operator (aka Your Own Boss)
Let’s start with some of the cons and get those out of the way and then get into why being an Owner Operator could give you the opportunity to really shine.Cons
- Financial Risk- If you are not in a strong financial place at the current moment it might not be the best idea to take on being an Owner Operator. With risk can come reward but it can also come with a lot of financial damage. Many shippers won’t pay for loads for 30, 60, or even 90 days after delivery, and if you miss getting them even one piece of paper in the packet the delays could be extended. You will have fuel expenses, maintenance, food, and daily living, as well as any unexpected surprises that might pop up such as a blown tire, leaky gasket, or motor leak. All of these are your responsibility as an Owner Operator.
- Time Off- While you are in charge of your own schedule and get to determine when you take time off, you are also the CEO, President, and driver. This comes with responsibilities outside of the truck and has the potential to really eat into the time that you aren’t driving.
- Higher Stress Levels- You are now in charge of everything. If you are not the kind of person that handles stress well, you might find this aspect of being an Owner Operator overwhelming.
- No Benefits- Most Company Drivers are eligible for employer-sponsored benefits such as health insurance, retirement matching, having taxes taken out of their earnings, and paid time off. These are now your responsibility to factor in when the money comes in to make sure you don’t sell yourself short in the long run.
- Ownership- As with most things in life there is a great pride to be taken in ownership. You tend to take better care of your equipment, you pay more attention to how you treat others as you are now a reflection of your business, and you know that if things go wrong you are the only one to blame. If you have the right personality, this can be a very motivating factor as an Owner Operator and can lead to a very successful life in the trucking industry.
- Determining Your Loads- As an Owner Operator, you get to determine not only the type of freight you will haul but also where you want to haul. If you want to see the country and travel all across the United States you can book your loads to let you do that. If you prefer a certain section of the country, whether that be for traffic reasons or type of freight, you can build relationships with shippers in a smaller area and make your living that way. There is a lot of freedom in this aspect of the business when you are an Owner Operator versus being a company driver.
- Customize Your Equipment- If you are a driver who prefers an air-ride seat or a specific type of gear shift when you own your equipment you can make these modifications instead of just driving a one-size-fits-all tractor. You also don’t have to worry about sharing your equipment if the company is wanting to keep the tractor out on the road at all times, even when you’re not in it. These customizations can add up quickly if you’re not careful, (if you have ever stepped foot into a chrome shop you will know exactly what I’m talking about), but if done in moderation and over time you can truly make your truck the home that is made just for you. This can make time out on the road more enjoyable and comfortable.
- Potential to Grow- After you get a couple of years of experience under your belt as an Owner Operator and keep a clear FMCSA score you could have the potential to bring other drivers and tractors in and run under your authority. This would give you the ability to increase your profits and still have control of the overall business.
- Expenses are Tax Deductible- One of the first investments you will want to make in your business is a qualified tax professional that understands the ins and outs of the trucking business. With so many different options out there to help you write off many day-to-day expenses, your investment should pay for itself fairly quickly.
Weighing Your Options for Becoming an Owner Operator
With any industry there are many considerations to take into account before jumping in and becoming an Owner Operator in the trucking business is no different. We have gone over several of the pros and cons of the overall industry but the main factor you will need to consider is yourself.Are you the type of person who prefers more control? Do you feel that risk is worth the reward if those rewards could be big? Are you a self-starter? Motivating yourself to keep pushing forward without having someone behind you can be difficult for some.No matter where you are in your owner-operator journey, using a TMS can help keep you out of the office and on the road. Truckbase offers a lightweight TMS designed with small companies in mind. Learn more about how Truckbase can support you by scheduling a demo today!