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Owner Operator 411


11 February 2009

FAQ for the Owner Operator - Top 10

Top 10 FAQ
(Frequently Asked Questions) 

Here are the "short and sweet" answers to some of the most popular questions.  For details to these answers and a lot more information, read the appropriate post. 

1.  Q:  Can being an owner operator make you a millionaire?
A:  No.  Probably not, although there is always an exception. If you operate your business correctly, you can make enough for it to support you. 

2 :  How much does it cost to start an owner operator business?
A:  There is no set answer to this.  It depends on the equipment you buy (new or used?), what states you run in, and whether you lease on to a company, or have your own authority.  If you lease to a company, it depends on what they pay for (permits, fuel taxes, etc.).  It depends on whether you (or your spouse) does your own bookkeeping, or if you need to hire an accountant.

You need approximately 10% to 20% down payment for your tractor and trailer.  If you are buying your own permits, you have to pay for them upfront.  Insurance companies want from 1 month to 3 months worth of payments in advance.

If you buy used equipment, what does it need before you can put it on the road?  Does it need tires? brakes? other repairs?  If you are leasing your truck to a carrier, you may be able to charge your fuel, but if you have to buy you own, you will need to pay for that before you can haul a load (200 - 300 gallons of fuel times $4.00 or more per gallon (as of August 2013).

If you are getting your own authority, you need to pay for that. Whether you are getting your own authority or not, you will have to pay for business licenses, and equipment licenses. 

3. Q:  How much does an owner operator make?
4. Q:  How much does a company pay an owner operator?
5. Q:  What is the average net income of an owner operator?
6. Q:  How much per mile should an owner operator get?
A:  What do you mean by "make"?  Do you mean gross or net?  Are you talking about being paid by the mile, or percentage?

Loads can pay anywhere from $1.00 to over $3.00 per mile gross, to the truck, but a good average figure to use is $1.50 per mile (I wouldn't run for less than that, but you need to make more per mile than your expenses per mile).

If you are leased to a company that pays a percentage, the average ranges from 65% to 75% of the freight bill.  (You still need to figure how much that translates to per mile.)  It also depends on what you haul.  The average net income is about ¼ of your gross (fuel will cost you about 40-50% of your gross).

You need to know if the carrier you will be leasing your equipment to will pay for deadhead miles (empty miles: running without a load - such as going from a delivery point to a pick up point). 

7. Q:  What is a good business plan?
A:  There is no set rule for a business plan.  A business plan is really a blueprint for what you expect your business to be financially.  What it needs to do is show a realistic income, and expenses.  This needs to be based on research.  You can't just go to a bank and say, "I can make $2.00 a mile, run 175,000 miles a year, and I will have $20,000 in expenses.  You need to show where these figures came from.  You need to break down your expenses (start up costs: down payments, licenses, permits), and ongoing expenses (insurance, fuel, maintenance).  This needs to laid out in a logical, easy-to-read and -understand manner.  Keep in mind that most bankers don't know anything about the trucking industry, so add supporting documents to show what you are talking about.  You might even want to add a "glossary" page, as some of the terms you will use will be unfamiliar to the financial officer.  Put everything you want them to know on paper, as you may not have the opportunity to speak to a person and explain what you mean. 

8. Q:  What kind of insurance do I need and how much will it cost me?
A:  It depends on whether you have your own authority or are leased to a company.  If you have your own authority, you will need to buy all of your own insurance.  If you are leased to a company, they will cover what is needed for a carrier, but you will probably have to buy a minimum of bobtail and liability.  If your equipment is financed, you will probably need additional coverage.  How much will it cost?  Just like your car insurance, prices vary depending on who you insure with and what type of insurance you need.  A minimum cost will be at least $1,500.00 a year, and can run to $10,000 a year if you have your own authority. 

9. Q:  Is now a good time to become an owner operator?
A:  Unless you really know what you are doing, probably not. 

10. Q:  How much do I need to have in the bank before I become an owner operator?
A:  Lots!  In addition to the cost of equipment (down payment, getting it road ready before putting it in operation), insurance, permits and other expenses, you need to have enough to live on until you start turning a profit, and you need to have enough to pay for a major breakdown (and to live on while your truck is being repaired).  You need at least enough for your first month's equipment payment(s).

You should have at a minimum enough to operate on and live on for at least two months. 

Have other questions not covered in this blog?  Add a comment.  I check this blog almost every day and I will try to answer quickly.

Be sure to subscribe to this post so you will get the latest and newest information.

I am sorry I have to do this, but due to spam "comments"  I feel I need to moderate comments from now on.
I am sorry for any inconvenience this may cause to my legitimate commenters.


Anonymous said...

I'm one of those who is thinking of going to a truck driving school, and driving for a company for a year and then buying my own truck. This info is extremely helpful. I've already been crunching some numbers and came to the conclusion that after everything is paid, I'm not going to get rich.

Road King said...


Thank you for your comment. It sounds as though you have a pretty good plan. It is a good idea to drive for a company before buying your own truck. This helps you to learn the ropes (and who knows, maybe you won't even like being on the road).

You are right, you won't get rich, but if you manage your business well, a decent living can be made. It takes a lot of dedication and hard work, though.

I am glad you are crunching those numbers before jumping into buying a truck.

Good Luck!

A hollar in Kentucky said...

My husband and I are thinking about buying a truck. He recently went through truck driving school and he got his CDLs. He has a misdmeanor charge on his record and we've found it very difficult to find a company willing to hire someone with a charge like his on their record. We feel that it may be best for us just to buy our own truck and book our own loads. We're young and he doesn't have much experience. I think it is nice that your wife has been able to work from home for your trucking business, thats what I would like to do myself. What do we need to do to get all of this started? Is it going to be any easier for us to begin his trucking career with his criminal history if we buy our own truck? Why is it that trucking companies have such a strict policy against hiring people with a criminal record? He's a good man, willing to work hard. He made some stupid decisions when he was younger but things are much different now and while I do understand that is probably the excuse out of most young mens mouths, I truly feel we've been sideswiped by these trucking companies for no reason. We spend hours filling out applications just to be denied in a matter of minutes. What do you suggest? Do you see success in our future? Are we wasting our time? Thanks for reading and responding to this long comment.

Thanks : )

Road King said...

A hollar in Kentucky,

Sorry for the delay in responding, but I have been having some health issues and have been out of commission for a while.

First, let me say that what you and your husband have been experiencing shows that "life ain't fair!" I don't have an answer about how to get someone to hire your husband.

People will tell you things like, "you need to work hard and prove you have turned your life around." BS! How can you do that if you can't get a job so that you can work hard and prove you make a good employee?

You two may be able to get work if you own your own truck, but you should know that if you try to get loads, or get a contract to haul freight on your own, a lot of the companies you will be dealing with will run the same background checks as they do for an employee. In my opinion, if someone is prejudiced against your husband because of his mistake, having his own truck won't help.

People don't like to hire someone with a criminal record because in today's economy there are 10 people without a record wanting the same job.

Truck drivers are responsible for loads worth thousands, and sometimes hundreds of thousands of dollars and an employer wants to know he can trust his employee.

I wish I had a magic answer to your question, but I don't. I will suggest that instead of just putting in applications (don't stop doing that), that you do what you have done here. get on some trucking sites, forums, MySpace, and FaceBook, and post what you wrote here. Set up a separate email account and post it so that if anyone sees it and would be willing to hire your husband, they can contact him.

There are employers willing to help people in your situation but I don't know who they are. You need to make yourself visible so that they can find you.

One other thing he might try (if he hasn't already) is to get a non-driving job at a trucking company, or maybe even in a warehouse or somewhere else with access to trucks. If he can get that job, then people will get to know him and his work habits and he may be able to get his foot in the door that way.

I would suggest that you buy my ebook which tells you everything you need to get started, but I really don't think buying your own truck would be a good option.

You sound like a sensible, level-headed young woman, and I wish you both the best of luck.

Anonymous said...

Road King,

I know that this is an older post but I have a question. Is $10,000 enough start up money? This what I will have in my business account after I purchase my road ready truck.



Road King said...

Anonymous "K",

I am pleased to see that you said you will have $10,000 in your business account for start-up costs after the purchase of your tractor.

I hope you also have money in your personal account. The reason I say that is that after you start your business, if something should happen, you need enough in your personal account to buy food and pay your personal bills.

"What could happen?" you ask. You could have an accident that puts your truck out of commission for a few days to weeks, your truck could break down and need repairs that take a few days to weeks, or you could get sick or injured and be unable to work and unable to hire a driver.

So, in addition to having enough money in your business account, you also need enough in your personal account.

Now -- is $10,000 enough start-up money? Yes, it should be enough to pay for your licenses, insurance, permits, and other start-up costs.

Don't forget, depending on your type of operation, you may have to buy extra equipment such as load chains, straps and tarps.

Even so, you should still have some left over for a "rainy day", such as minor breakdown.

Does any owner operator ever have enough to cover any situation? Probably not. To replace a blown engine can cost up to $25,000. A blown tire can cost $600 or more to have it fixed on the road (including labor), and you may also need to replace a rim if it was damaged by the tire when it blew.

A good business person will have enough to buy a blown tire, have an oil leak fixed, or some other "minor" problem.

Successful OO's will save for major routine expenses such as new tires or a scheduled overhaul, but few will have enough for major unexpected expenses, such as having to replace an engine -- most will have to take out a loan.

By the way, when figuring an expense, unless you do the work yourself, figure the costs of parts and then double it to cover labor. This won't be exact, but it is a pretty good rule of thumb.

I hate to keep harping on this, but even if you have enough in your business account to cover whatever, if you don't have enough in your personal account to see you through until you get back on the road, you will start "borrowing" from you business account to live on, and that is a good way to get into trouble.

I don't mean to sound absolutely discouraging, but these are things a lot of people don't take into consideration when planning their finances.

On the other hand, with $10,000 in a business account, you are far ahead of most people who try to start a trucking business and barring any major problems, you should do fine.

Good Luck! I hope this helps you make your decision.

Anonymous said...

Buster owner operater ,
Yes you are wasting your time. If his conviction is bad enough to keep him from getting hired on as a company driver what makes you think it's going to be different as an o/o? Stupid decisions can and will stay with someone forever. He is being held accountable for what he's done. We as people are all accountable for what we do. And it's very expensive to become an o/o. You can't just go get a truck and grab freight. If it was that easy everyone would be doing it.

Robert Jacko said...

Thank you for sharing the information.

Driving a truck needs a lot of skills. I would like to tell that I recently came across a site called non forced dispatch who are providing the service of truck driving jobs.
Owner Operator Trucking Jobs In Top Landstar Agency to become an owner operator.

Road King said...

Robert Jacko,

Thank you for the information.

Jay Anderson said...

Hey Road King

I am a 24 year old man interested in join the trucking industry, currently I do not have my cdl but enrolled for school in September. My question is what would be advice for me being a company driver or drive OO leased to a company with my father (he already own his own truck)? His truck currently isn't in action so he needs licenses and insurance but maintence is prime

Thanks in advance

Road King said...

Jay Anderson,

First, there is a reason your father isn't running his truck - the question is why? Not making enough money, burned out, Illness? Talk with him and find out why he quit driving.

Second, I recommend that if you do get your CDL, try being a company driver before jumping into being an OO. Who knows, you may not even like being a truck driver. If you do, you can learn a lot by being a company driver that will benefit you greatly if you decide to be an OO.

My first thought to respond to you was to tell you to get a refund on your tuition, then run as fast as you can, but you probably don't want to hear that!

Being an OO has many problems and expenses that being a company driver doesn't have, so try that first.

Good Luck.

If you have any other questions, please fell free to post them here, or drop me an email.

Anonymous said...

Hey there. I talked to a company about leasing on with them and they said my truck payments would be about $880 a week. Is this overkill or doable? No d you this doesn't include my insurances and the like. Hope you are still here.

Road King said...


Thanks for reading this blog.

You really didn't give me enough information, but this sounds way too high to me.

In general, I do not advocate lease/purchase. There are too many pitfalls. First is it a true lease purchase, or a rental purported to be a lease purchase?

Carriers will tell you all kinds of good things about how much you can run/make, and what a good deal you are getting; however, the reality is very different. There are all kinds of hidden costs and stipulations hidden in the contract. Even if everything is on the up and up, carriers often give you less and less freight, so that you are ubable to meet your payments, and you end up losing the truck, and all that you have invested in it.

If you would like to give me more details, or ask more questions, please feel free to do so.

Road King said...


I ran across this and think it might help answer the last reader's question:

Anonymous said...

I live in Canada and I have been driving truck from BC to Alberta for about 2 years now, there are opportunities for me to obtain a truck and have family with good connections for getting loads, I am well educated and organised with finances, is becoming and OO going to be a good way to make a living and in future obtain more trucks and grow from there? Or is it wiser to partner with someone with almost a lifetime of experience (and investor) to move forward?

Road King said...


Thank you for your question.

IF you can get good loads, then you MAY be able to make it as an OO and make a livable profit. As to being able to expand, I would say that is probably not feasible. Of course, it is possible, but so many go into trucking, thinking of doing the same thing, only to find they are barely able to support one truck, much less several.

Partnerships can be tricky. There MUST be a very high level of trust and respect. It is easy for one partner to cause loss for another partner, whether intentionally or not. Disagreements over the direction to take the partnership, money, investments, and control, are just a few issues that can cause dissension.

I hope you are not thinking of partnering with a family member, as there is an axiom that one should never go into business with a family member.

If you do partner with someone, would it be 50/50? Other than experience and money (both valuable, of course), would the partner contribute anything else? Would they be an active or passive partner? Would they be a general or limited partner? (I'm not sure of Canadian laws, so these questions may not apply.) Will your business be profitable enough to provide adequate income to each partner?

Personally I would rather try to go it alone than to have a partner. If you are just considering a partnership for the investment, I would try to gets the funds some other way. Perhaps you could still get their experience advice, if they are a friend. If they are unwilling to help you without compensation, you could offer to pay them for their advice as a consultant, or get the information from another source.

Hope this helps. If you have more questions, don't hesitate to write,

Anonymous said...

Hey there road king, I came across this site today and was interested in getting you 2cents on a business plan I have.
History about myself- drove otr and local for 4 years with a perfect service record then joined the army as a truck driver. I have over 600k miles and also did 6 months as a lease operator until they broke contract. My army contract is up in 2016 and have in my opinion a good set of business plans. They are complete down to a 10 year plan for the business. I plan on trying to get a va small business loan for $72,000 which would cover all start up costs and running and living costs for 3 months. What sets my business apart from the rest is that I plan on renting trucks on a daily, weekly, and monthly basis. That way if theres no loads or one of my drives wants to take a week of home time heres no truck payments hanging over my head. I plan on running locally while I hire drivers to run otr. Id start off with buying 3 trailers and renting a daycab for me and a sleeper for my hired otr driver.
why rent? Because you can run update new equipment vs buying something old thats gunna have issues, you virtually have no truck maintenance and repair costs, and no pending truck payment. Its also cheaper than a truck payment on a month to month basis. Obviously you dont get to keep or customize the trucks tho as if you were buying them, but the saved money would go towards paying off the loan, expanding company, and saving to buy a new truck outright. My cpm currently averages $2.00/mile. Thats with a great driver salary, all overhead, paid medical benefits, and company profit. I plan on doing all the book work and load booking and hiring atbs for my taxes. We plan on getting loads off of online load boards and establishing a good broker base. Please give me your opinion on whether or not you think this would be a good plan. Thank you!

Road King said...


You certainly have the experience, and it sounds as though you have thought this through very well. To have a 10 year business plan is excellent; I hope you have factored in cost-of-living increases.

The fact that you can get a VA loan is a plus.

I don't know anything about daily rental of a semi so I can't make it an intelligent comment on that; however it sounds as though that may be a good route to go. The main negative issue I see with a daily rental is availability. If the rental company has a limited number of trucks and they are all rented on the day that you need one, what would you do?

Another thing to consider is the amount of work involved in getting loads for your drivers and taking care of all the bookwork, which includes a tremendous amount of record-keeping as an employer. Do you think that you would have time to do that while you are also running locally?

It is good that you think you know what your cost per mile will be. Do you know for sure that you can get loads that pay enough to cover that amount? You did not specify what type of trailers you plan on buying, or what sort of freight you think you will be hauling.

My other concern is that you are a little overly ambitious in wanting to purchase three trailers and hire a driver right off the bat. You may do better working by yourself for a while until you learn the ropes.

I do believe that you have a much better chance of making it than many people who have written to me, as you have the experience and what sounds like a feasible plan.

If you have any other questions please don't hesitate to write, and good luck in your endeavors.

Anonymous said...

To the lady and her husband who has a background. Don't listen to these idiots. I am a very successful owner/operator who also has a past. 17 years ago I was convicted with two felonies. Will you have to work harder? Hell yes. Will people talk shit? Hell yes. Does it matter what they think? Nope. Yes my past haunts me but also drives me and makes me stronger. I also went to a school several years ago and was faced with the same situation of not finding a job. The problem was I was applying with companies like Werner, Swift, USA truck, etc.. Now with that being said, owning your own truck is tough at first and unless you lease to a company that'll cover repairs, maintenance, tags, insurance, permits, and such, you'll need a lot of money to survive the first year. Trust me if it can go wrong it will. It's not a matter of will it rather than when. My advice to you to get your feet wet is to do a lease purchase. Yes I know its stupid to a lot of people but it'll teach you how to manage your expenses to get a better return. Also if you do it right you can make some pretty good money( save, save, save) open a separate account for the truck(don't touch it) determine what a company driver makes and pay yourself as if you were an employee. Put the rest up. You will most likely never pay for the lease purchase truck, but manage your money right and( preventive maintenance) and take the money you have saved and either buy or put a nice down payment on a truck. Being successful in changing my life hasn't been easy but since my conviction I have been a fireman and a police officer. I have mentored hundreds of guys and watched them turn there lives around. I would love to see your husband succeed. If you need me my email is

james abram said...
This comment has been removed by a blog administrator.
Shawn Deny said...

This needs to laid out in a logical, easy-to-read and -understand manner. Keep in mind that most bankers don't know anything about the trucking industry, so add supporting documents to show what you are talking about.
Commercial Insurance Candidate Referrals

Road King said...

Shawn Deny,

Thank you concurring with what I wrote about a business plan.

As with everything on this blog, details of a good business plan are detailed in my ebook, Owner Operator 101.

Brian Gustovich said...

Anyone hear of ATS? I hear positive things about their lease program.

Anonymous said...

I need to ask you a question what about it you get an OWI in your on personal truck but not in your bug truck how doesthat effect your driving record for trucking

Road King said...
This comment has been removed by the author.
Road King said...


Good question!

Violations, such as speeding and DUI/OWI, in your personal vehicle DO affect your CDL.

The violation for a 1st offense DUI in your personal vehicle when you have a CDL is:

"For a first conviction or refusal to be tested while operating a non-CMV, a CLP or CDL holder must be disqualified from operating a CMV for 1 year".

For the actual regulation, go to: FMCSA Regulations: § 383.51: Disqualification of drivers. This page has a list of all of the disqualifications and their penalties.

I hope you asked this question for general knowledge, not because you got a ticket for operating while intoxicated.

Itrosys Gps said...

Great Post, I love to read articles that are informative and actually have good content. Thank you for sharing your experiences and I look forward to reading more.
online Truck booking | Custom gps solution

Road King said...

Itrosys Gps,

Thank you for the compliment. I appreciate that you found this blog informative with good content.

Anonymous said...

This was great! I've got about two years under my belt now, and have been dreaming of the oo life since I started. The company I'm currently working with has a shady lease program. Sliding pay scale.. short loads pay more per mile, and long loads pay less.. I'd much rather get paid a flat rate, and know what to expect week to week.. So basically I understand.. The best way to go is loaning from the bank. Leasing can be a slippery slope, and you have to be careful with companies messing you around, and losing the truck.. with outright owning a truck.. If you're not getting the miles you need to cover costs.. you can take your business elsewhere. That's why im thinking of going this route as opposed to company leasing. I enjoy having longer trips that take a couple days than short trips live load/unload same day, and scurrying over to the next place for a live load. Very much hate these days, but they happen. It's part of the world we live in. Lol

Road King said...


Thank you for your thoughts.

Unknown said...

Hi , I have read your article it's quite informative. I am a owner operator in india and own 6 trucks and trailers. I am in this business since 1996, is there any way I can become o/o in usa .

Anonymous said...

Hello, my husband has recently pasted away and has drove truck his whole life. I now have the business we only have the one truck and trailers. I do not have my cdl and I don't know what to do. I really hate to part with it cause he loved it so much. The truck is gorgeous. Any suggestions?

Road King said...


Please email me at Road King, so that we may communicate directly.

Thank you.

Anonymous said...

To who are you referring to?

Road King said...

Sorry. I was referring to the most recent post, the lady whose husband recently passed away.

curious gorge´ said...

Somebody told me you could make money by leasing your own truck with a company and you dont have to drive it ant ideas as to what im talking about? I just ran into a gut off the streets ( im not a driver either)

Road King said...

curious gorge',

Yes, you can lease your truck ro a carrier (company) and hire someone to drive it. The company will not provide a driver.

You would only be an owner (and employer), not an owner operator.

I do not advise you to do this because:

1. You obviously don't know anything about trucking.

2. Good drivers are hard to find. A bad driver can cost you more than you make.

3. You would probably not make a profit because in addition to regular truck expenses, you would also have employer expenses - taxes, extra record keeping, extra bookkeeping, drug and alcohol testing, to name a few.

Thank you for your question.

Kendall Everett said...

I really appreciated your tip to have at least two months income saved. As an owner-operator, it's always better to be prepared in case something happens like you mentioned. If you have a lot of debt that's owed, I would definitely make sure to have a little more than two months so you know you are secure.

Unknown said...

How does one calculate what the per mile cost should be. Providing the person runs their own authority and insurance?...BTW very helpful blog

Road King said...


Thanks for the compliment.

Go to:
Interactive Cost per Mile (CPM) Calculator to Aid the Owner Operator

You need to figure how much it costs you to operate (total expenses) per mile, then you need to make more than that amount to make a profit.

You should know three amounts. Non-operating Expenses (insurance, taxes, licenses, etc.), Operating Expenses (fuel, fluids, permits, meals, supplies, etc.) and Total Expenses (total of non-operating and operating expenses).

Hope this helps.

Anonymous said...

Lie lie lie, keep lying until you make it. The truth is, I had no experience and picked a trucking company that went out of business and put that worked there for 3 years. If that don't work buy a truck, lease it to a smaller business and hire a driver? Give him 20 percent and kick your feet up and watch him make the money. I am usually a great person but life is showing me that the good men never win but die trying.

Anonymous said...

Question? If you have never ben a o/o how do you know how much truck you can afford? I don't know how much it will bring in. I average 25-3,000 miles a week. Being a company driver

Road King said...



Since you are a company driver, you have an advantage over a lot of people. Will you be leasing your truck to the company currently drive for? If so, you should be able to get an estimate of what they pay, then you can use the Interactive CPM Calculator . If you will not be leasing onto that company, you need to talk to other owner operators. You also need to contact companies that you think you will be leasing onto and see if you can get an idea of how much you will make. Do not believe everything they tell you, as most recruiters tend to exaggerate.

After you get an idea of what your income will be, use the interactive cost per mile calculator to figure your expenses. This calculator lets you play "what it". For example, can I turn a profit if my truck payment is $1,000 a month? What if it is $1,500 a month? What if fuel goes up $.50 a gallon? Do not overestimate your income or underestimate your expenses.

Also check out my Facebook page Owner Operator (trucking)

I hope this helps you. Good Luck.



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