Thinking about buying a truck and becoming an owner-operator? Owner-operator consultant Kevin Rutherford, speaking in Omaha, Neb., at the five-day Certified Master Contractor Live conference he produces, listed six common mistakes.
- Listening to family and friends. “It’s really dangerous asking for advice because there’s no way of knowing whether the advice is good or not,” he said. Those close to you will tend to support you if you’re excited, while those who tend to be negative will frown on any risky idea. Asking dozens of people the same questions at least gets you closer to the truth.
Not having a clear written plan. Most aspiring and existing owner-operators are reluctant to take the time to write out a business plan, even though those who do find that it always pays off.
- No bookkeeping system. Most owner-operators don’t know, or even try, to determine basic business measurements such as their cost per mile or their monthly profit and loss. Rutherford developed TruckGauges, an online spreadsheet for owner-operators to record and analyze their finances, which he said is “my most profitable revenue stream now.”
- Partnering with the wrong carrier. Rutherford gave his secret of success: “Provide the most value to your customer you can possibly provide.” The customer is “whoever writes your check,” which for a leased operator is the fleet and occasionally a broker.
- Spec’ing the wrong truck for the job. Buying a truck is “the first thing everybody wants to do because it’s the fun thing,” he says. But the better way is to decide on leasing with a carrier so that factors such as lanes and type of freight are known, which will help determine your ideal specs.
- Not building a winning team. Doing as much as you can yourself helps get your business off the ground by cutting costs, but soon you need to pay others to do what you have no time, interest or skills for. This includes routine maintenance, accounting and anything else you choose not to focus on.
Rutherford is a long-time presenter for Overdrive’s Partners in Business owner-operator training program and has a regular show on SiriusXM’s Road Dog channel.