Although there are many advantages to being leased to a carrier, which I have highlighted in previous blogs, there sometimes comes a point and time where a truck owner has to part ways with their carrier.  Whether it is to go on their own authority, or to lease their services to another carrier, the change and decision to do so can be a hard one to choke down.  Whatever the reason, certain factors must be taken into account such as the cost of leaving and learning the ropes of your new decision.  Needless to say, an owner-operator can drive himself or herself pretty crazy adding up all of the factors and deciding what to do for the greater benefit of their business.
 
Being that I have recently had to contemplate everything that goes into this decision, I wanted to share my first-hand, insanity-inducing decision factors with you.  After months of contemplation and talks, I decided to leave the carrier I had been leased to for three and a half years.  My parting with them was on good terms and had nothing to do with any kind of personal grievances.  My decision was purely a business decision in the fact that my own company goals and productivity levels were outgrowing the carrier’s ability to supply my business needs.  In my decision, I took into account a lot of factors and tried to hold out until the very last moment, since I did not want to contribute to the already growing problem in our industry of driver turnover.  Leaving a place where I had built my business and called home for nearly four years proved to be one of the hardest decisions I have ever had to make.
 
Some of the deciding factors that went into this choice were things the other pros and myself have blogged about in the past.  Being with a carrier that has an adequate amount of equipment (trailer pool) for their particular type of operation and customer base to supply their contractors with work, can be two of the most important things when it comes to running a successful business partnership between an owner-operator and a carrier.  It can mean the world to have an empty trailer when you need it, rather than having to burn your own fuel for hours on end in order to find one.  Being that a mostly drop and hook operation relies on a larger than normal trailer pool, in my case the lack of too much of an unnecessary expense for me to keep subtracting from my bottom line. 
 
Another factor to consider is the competition for the work that is available.  If there are consistently more drivers than there is work to be had, someone has to go without.  In a leased situation, there becomes an issue when company drivers are feeding off of the same plate of the owner operators.  Although it is nice for a carrier to run owner operators in the busy season due to decreased overall liability on their part, the decision can easily switch when work becomes scarce.  A carrier may decide to run loads on their own equipment rather than an owner operator due to the fact that a company driver has certain costs regardless of whether they sit or not, including their company sponsored benefits.  The carrier cannot be faulted for this, as they are just trying to produce revenue on their trucks to help covers their costs of doing business as well. 
 
My decision to lease onto another carrier comes with a heavy heart.  I would be lying if I said I did not grow accustomed to a certain way of doing business after almost four years.  I got to work with and meet a lot of great people on the carrier’s side and will always be thankful for their help in building my own business and enabling me to accomplish what I have thus far in my career as an owner operator.  I look forward to keeping in touch with those I was fortunate enough to develop relationships with, but have to follow my business goals to the next step in my evolution as a business owner.  Although I have chosen to lease my truck onto another carrier, I have completed a vast amount of research to ensure that their goals and hunger for mutual success are inline with those of my business.  They happen to possess a seemingly endless amount of equipment as well as a customer base and freight consistency that is unmatched in the Southern California short-haul freight market. 
 
In order to be successful in your own ventures, make sure you know your goals and align yourself with those that share in your passion.  As a leased owner-operator, if you and your carrier start to drift apart in your alignment, approach the decision making process to change your current situation with care.  Be sure to take into account the cost of things such as orientation days with a new carrier, or even the cost of operating under your own authority.  Once you have weighed the pros and cons of your current situation and thoroughly made plans on what your next step will be, it may be time to make a move.  Do not be afraid to do so…sometimes you have shift gears to get things moving in the right direction!

Comments (3)

Jimmy Nevarez

Jimmy Nevarez is the Owner/President of Angus Transportation, Inc., based in Chino, California.  Jimmy pulls a 53' dry van hauling general dry freight for his own small fleet, operating on its own authority throughout all of Southern California and Southern Nevada.

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January 05, 2017

 
 

It looks like you spent a great deal of time calculating and weighing out all of your options before making a rash decision. Good luck with your new business partner.

October 01, 2013 5:37:00 AM

I have switched carriers 4 times in my time as an owner operator. One of them was going out of business. The others just weren't working out. Thins constantly evolve with the IC and the carrier. We as owner operators need to do what is best for us an our families.

September 30, 2013 5:38:42 AM

Jimmy good luck with your new carrier as this is not something to do on a whim. It is expensive to change and as you point out it takes a lot of research and number crunching to make the decision and remain profitable.

September 30, 2013 4:29:47 AM