In the trucking industry, there are many career paths a driver can take. One of those paths (and one of the most lucrative) is to become your own boss as an owner-operator. An owner-operator is a self-employed truck driver who delivers goods on their own schedule to one or multiple clients. Owner-operator truck drivers tend to work long hours but can make good money if they stick with it. According to ZipRecruiter, self-employed owner-operator truck driver salaries currently range between $77,000 to $299,500, with top earners making nearly $373,500 annually across the United States. Keep reading to learn seven steps you can take towards becoming an owner-operator and find out if it’s the right move for you.
Step 1: Gain truck driving experience as a company driver
If you’re considering becoming an owner-operator, you need to have a deep knowledge of the industry and of course, your Commercial Driver’s License (CDL). It’s a good idea to have about 3-5 years of experience as a company driver before taking the big step into the owner-operator space. Having some experience under your belt will help you decide if this is the right industry for you, but it will also expose you to some of the challenges you may face and help determine if you could see yourself doing this long-term. Additionally, you’ll need to find work and arrange your own hauls. Having some trucking experience will help build up your professional network and in turn, give you more opportunities when it comes to contracting future clients and jobs.
Step 2: Decide if you want to lease or buy your equipment.
As a company driver, your employer provides the truck. As an owner-operator, you’ll have to decide if you’re going to lease or buy your truck. Buying a truck is a major expense! You should expect to pay $100,000 to $250,000 and have a decent down payment to avoid high monthly payments. You’ll also want to carefully consider everything from weight capacity and fuel efficiency to insurance coverage and maintenance costs. According to TruckStop.com, fuel is, by far, the biggest expense for an owner-operator. Fuel alone can cost an owner-operator between $50,000 and $70,000 each year. The second biggest expense will be the truck payment and maintenance.
When researching trucks, it’s important to find out which truck will suit your needs not only for today, but in the future. Does the truck have a good resale value? How much on average does it cost to maintain? How many miles per gallon will you get? How much does it cost to insure? What is the safety rating? These are all things you should ask before making a decision.
Step 3: Form a business and register a USDOT number.
As a new business owner, you’ll need to officially get your business license. A business license will help you protect your personal assets (like your house or personal car) if your business faces bankruptcy or a lawsuit. Many small business owners opt for a limited liability company (LLC), but it’s a good idea to consult with an attorney or accountant on what works best for your situation.
The next thing you’ll need to do is apply for a USDOT number. A USDOT number is the license that allows you to operate your truck as an owner-operator. This can be done online, but it’s advised that you visit your local DOT office in person and make sure everything is in order before you start driving.
Step 4: Get your truck and trailer third-party inspected.
Next, get your truck and trailer inspected by a third-party inspection station with credentials from the Federal Motor Carrier Safety Administration (FMCSA). They will inspect both your vehicle and driving record; this ensures that everything meets the safety standards set by the FMCSA. Without this information on file, no company will hire you as an owner-operator truck driver.
You should also get your trucking authority: this certifies whether or not you are insured to drive commercially in your state or country. You’ll need proof of insurance before getting hired by any company. Joining a logistics solution company like Roadrunner will give you access to discounted rates at many locations across North America.
Step 5: Obtain a motor carrier number.
The next step is to acquire a motor carrier number. This is a unique identification number that the U.S. Department of Transportation (DOT) assigns to commercial vehicles so they can be recognized on the road, and it’s required for all interstate transportation of goods by truck. You’ll need your USDOT number when you register with a dispatch service and when you buy your truck; without it, you won’t be able to complete either task legally.
If you’re not quite ready to purchase your first tractor-trailer yet but would like to start working towards becoming an owner-operator truck driver as soon as possible, contact your state’s Department of Motor Vehicles (DMV). In most cases, they’ll be able to issue you with one immediately—but keep in mind that each state has its own set of requirements regarding how frequently these numbers are issued and how long they last before expiring again once used up entirely.
Step 6: Make sure your insurance is up to date.
You’ll need to make sure your insurance is up to date. As an owner-operator, you’re responsible for running an entire business that uses heavy machinery and carries hazardous materials. To operate safely and legally on the roadways with confidence, you’ll need proper insurance coverage in place.
Make sure the insurance you obtain can cover all of your needs: liability protection for others involved in accidents caused by your negligence, vehicle damage, personal injury protection, medical payments coverage, physical damage protection against damage done by other cars crashing into yours, fire, theft and collision coverage, roadside assistance services like tow trucks or flatbeds when needed, cargo liability protection—you get where we’re going here?
Step 7: Join a logistics solution company, if you’d like to avoid finding loads yourself.
If you’d like to focus on driving, not finding loads—you can join a logistics solution company. These companies do all the heavy lifting for you regarding finding loads and keeping your business running smoothly.
The benefits? You’ll be able to spend more time with your family and friends, focus on your health and wellness goal, and finally have time to work toward financial success. In addition to using freight brokers, there are other ways to find loads.
One way is through load boards, which are online tools that allow truck drivers and shippers to find each other in order to conduct business quickly. Load boards are free for truckers and readily available on the internet. You can also use them to look up the prices that other companies are paying for the same type of load you’re interested in hauling. Some load boards even allow you access to loads they don’t have listed with their company.
In Conclusion
We hope this blog has helped you decide if you’re ready to embark on your new career as an owner-operator truck driver. You’ll be sure to good money and enjoy the freedom of working for yourself. If you aren’t sure where to start, 5th Wheel Hub is here to help. Reach out today to discuss the future of your career.
