31 Jul Should I Buy a Fleet of Trucks?
With truckload transportation costs rising to historic highs, many shippers wonder if they should start their own transportation division and buy a fleet of trucks. For companies frustrated with massive fluctuations in availability and price, it’s a natural thought. Having your own fleet of trucks can let you control your outbound shipping schedule, increases your visibility, and prioritize your important lanes. If you have the money to invest and willingness to learn, it can be a great solution. With that said, many shippers are unaware of the potential risks, costs, and headaches they may encounter. Before you head to the truck lot, answer these questions to ensure it’s the right step for you.
Are you familiar with the DOT rules and regulations?
Like any new venture, understanding the industry you want to operate in is crucial. You’ll have to become a licensed motor carrier with the Department of Transportation (U.S.), who regulates the roads. Before you send your truck out, know the rules. With new ELD regulations, your equipment and drivers can be audited at any time. (Check out the ELD here). Also, be sure to review the laws in every state you will be operating in to ensure that your company will be compliant when crossing borders.
Who is going to drive your truck?
Owning your truck availability is a great advantage, but the ability to deliver to your customers boils down to your drivers. Having experienced and reliable drivers are essential for safe and on-time deliveries. The problem is, there is a national driver shortage, so acquiring skillful drivers can be challenging. With the national demand for drivers at a record high, expect the price of hiring to be up. Not only salaries, but a multitude of the large carriers are improving their benefits and bonuses to attract and keep drivers. Also, you’re going to need backups. Traffic accidents, driver illness, running out of legal road time, and many other issues can push drivers off schedule, so you will need to have more on hand. Having the right amount of drivers can prove to be a difficult balance, as you need drivers who are available, but, at times will have nowhere to go.
Who else will I need to hire?
To effectively manage your fleet of trucks and transportation operation, you will need more than just drivers. Who will manage the driver’s hours and schedule, compliance, dispatch and maintenance? Who will broker loads for your driver so that they are not driving home empty? Depending on the size of your operation, these questions can help determine how many people you will need to hire. Look to your local market to see the average employment costs needed to bring someone on board.
How much will it cost to maintain your equipment?
Trucks break down. Do you know what it costs to repair common maintenance issues? Do you know the hourly rate for diesel mechanics? You may need to hire your own. Before you talk to the sales department at the dealership, visit a local fleet maintenance company and sit down with a manager to see what it will cost to maintain your equipment. Expect to pay much more when the truck breaks down on the road and you need roadside assistance. Also, if you decide to lease extra trailers to keep your trucks on the road as much as possible, factor in the increased maintenance cost and the increased chance of breakdowns on your shipping schedule.
Can I ditch my broker?
Having your own trucks will remove the need to work with a broker, right? Well, not necessarily. Once you have your trucks running at capacity, what happens when one of your customers orders 10x what they normally do? Or when a truck is out of commission due to a breakdown? There will most likely still be times when you will need more capacity to meet the needs of a customer, and the flexibility a broker can be a great resource. Since they may be necessary to your operation, partner with a reliable broker to help you stay on schedule.