Medina, Ohio
1156 Medina Rd
Medina, OH 44256
(330) 239-2229

How to Become a Successful Owner-Operator February 26, 2019

Medina, Medina
How to Become a Successful Owner-Operator, Medina, Ohio

Professional truck drivers have many diverse career options. For example, they can become a regional or over-the-road driver. They can also choose between dry or refrigerated freight. One path that has become increasingly popular in recent years is the owner-operator or O/O role.

An O/O is an individual who owns and operates their own trucking business. Some lease onto a motor carrier while others work under their own authority. There are currently 350,000 to 400,000 owner-operators in the United States, according to the Owner-Operator Independent Drivers Association. However, a report by TheStreet suggests that the country was short 60,000 drivers in 2018—and this shortage could triple by 2026. Thus, the industry needs more O/O’s. Below is a guide explaining how and why you should join the movement.  

Benefits of Being an Owner-Operator

High Lifetime Earnings 

Most truck drivers are paid by the mile. On average, they can expect to make $41,110 in their first year, according to AllTrucking.com. After three years, that salary could increase to $88,710.

Owner-operators with their own authority, on the other hand, receive a percentage of the total freight bill. They can also seek out higher-paying loads. As a result, they earn more than company drivers. According to PayScale, the average O/O makes $98,009 per year. On the high end, owner-operators can make as much as $195,049.

Flexible Schedules

If you’re tired of 9-to-5 desk work, consider becoming an O/O. Owner-operators set their own hours, picking the times that are most convenient for them. Whether you want to work for a month straight before taking an extended vacation or alternate your schedule every week, the choice is yours. Just make sure you’re working enough hours to cover both personal expenses and operational costs.

Independence & Control 

truck driverWhen you own and operate a trucking business, you have complete control over your career. You get to decide which companies you work with and which loads you haul. Most importantly, you determine the company’s priorities. If you only want to take jobs that provide a better work-life balance, you can. If you’d rather become a top-earner or build a fleet, that’s a viable option too.

5 Steps to Becoming an Owner-Operator

1. Calculate Startup Costs

Before you commit to this new career path, it helps to understand the costs associated with owning and operating a trucking business. Maintenance, fuel, insurance, taxes, and permits add up over time. Likewise, you’ll need to buy or lease a truck as well as pay for truck driving school if you don’t already have your commercial driver’s license (CDL).

Take some time to evaluate your finances and determine if you have enough to cover the initial costs of becoming an O/O. Also, make sure you can keep the business afloat while still earning a profit. Use the “golden equation” of trucking:

Revenue per Mile – Cost per Mile = Gross Revenue – Taxes = Net Profit

Aspiring owner-operators should consider taking a class on bookkeeping or basic accounting before creating these budgets. Financial literacy will help you start strong as well as maintain a profitable business throughout your career.    

2. Complete Truck Driving School

truck driving schoolOwner-operators must receive proper training before they can hit the road. That means you’ll need to attend truck driving school and earn your CDL if you don’t already have it. Using both in-class instruction and in-car training, truck driving school will teach you safe driving techniques as well as industry laws and regulations. It will also cover topics like maintaining the truck and operating equipment with difficult shifting patterns.

In addition to passing the CDL exam, there are a few other requirements you must fulfill. Owner-operators—and truck drivers, in general—must be at least 21 years of age. There is no maximum age cutoff for the profession; you just need to pass a Department of Transportation (DOT) physical assessment and drug screening. For these reasons, O/O is an ideal career for drivers of all ages.

Owner-operators also need to have a solid driving record. Small infractions such as incorrect parking or minor speeding won’t disqualify a truck driver from becoming an O/O. Serious violations such as driving under the influence of drugs or alcohol can, though.

3. Obtain Authority

As previously mentioned, owner-operators have two options: lease onto a motor carrier or operate under their own authority. The latter, while it comes with immense freedom, requires additional documentation. You’ll need to acquire a USDOT number as well as a Motor Carrier (MC) number.

A USDOT number is an identifier that is unique to your trucking business. It allows law enforcement and the Department of Transportation to quickly access your safety information. All truck drivers need one.

MC numbers, on the other hand, is the identifier that gives drivers interstate operating authority. It shows that you are authorized to transport federally regulated commodities or arrange for their transport.

To get your USDOT and MC numbers, you must first register via the Federal Motor Carrier Safety Administration’s Unified Registration System. If you already have a USDOT number, you can instead use the legacy registration system. Visit the FMCSA’s website for additional information regarding the application process.

4. Secure a Truck & Trailer

Once you’re properly trained and certified, you’ll need to obtain your truck and trailer. You do so by either buying or leasing the equipment. If you have limited credit or funds, consider leasing. This method allows you to pay a set monthly fee for the duration of your lease—typically three to four years. At the end of the agreement, you can either purchase the truck outright with a balloon payment or simply return the equipment.

CDLIf you have sufficient startup money and are planning to stay in the industry for a while, you should instead buy the equipment outright. You’ll still make monthly payments, but the money will go towards owning the truck rather than just using it.

Many truck drivers take advantage of bank financing to help them pay for their vehicle. Before applying for a loan, compare interest rates between different providers to ensure you’re getting the best deal. Also, note that personal factors such as credit scores and job history may affect the rates, too.         

5. Set Attainable Goals

As previously mentioned, owner-operators with their own authority have total control over their career. So, once you have the right training and equipment, sit down and develop several goals for the next five years. What do you want to achieve as an O/O? What do you need to do to get there? These objectives will create a road map for your career and help you stay focused. They will also provide a benchmark by which you can measure progress.

If you’re not yet sure what goals to set, consider maximizing profits or minimizing expenditures. You can also aspire to maintain a work-life balance, stay abreast the latest technological advancements, or even build a fleet. The choice is yours—and it is this freedom that inspires so many truck drivers to become owner-operators in the first place.

 

If you are interested in exploring the owner-operator role, contact Hamrick School in Medina, OH. For over 30 years, their passionate instructors have helped thousands of truck drivers gain the knowledge and skills they need to excel in this rewarding career. The truck driving school offers two CDL training programs for students of all experience levels. They also provide financial assistance to those who qualify. Visit them online to learn about their rigorous curriculum. Call (330) 239-2229 or fill out their request for information form for more on the admissions process.

The Hamrick School’s state and school license information are as follows:
OH Reg. #2057
ODPS License #1439-2369

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