Of course this is one of those mornings where I have been writing this in my head since 5am—It is important and should be said to everyone involved and needing involvement of investors and money flow for a trucking industry business. This includes loans, investments–and the proverbial money within the industry or coming into the investment thesis needs for the industry.
Tales of what I am seeing
Let me describe a few things I am seeing first hand–
Over abundance of Courses:
I could be selling course, books, and all the common proverbial bullshit that I am seeing coming into the market. Hell, I have a book ready to start editing—-however, it is not where I want or see myself within the industry as a whole. I may change my mind and decide to publish later on, but the reality is the influx of the people selling the courses and knowledge want to be teaching, or want to be in the info product business.
I am not judging– nor am I saying anything wrong with the model. Everyone has to remember they are selling you what they think you as a new person wanting to get into the industry needs to see.
90% of the time, the courses are the same junk and bullshit anyone selling you shit will tell you about the industry in hopes to get you into another line of business they have. That is why I don’t sell shit. I am not that proverbial all the grass is green bullshit guy.
What these courses usually tell you is how you get into the industry, how to get a truck, hire drivers, and how beautiful this “ESSENTIAL” business is, when the reality is it is a business. It is work, a lot of work to be successful.
More and more claim to teach to get their people to a “7 figure trucking business.” I am here to tell you– READ MY LIPS— 7 figures is not shit!! 7 figures in the trucking business is a starting point.
Look at the numbers—
Avg rate for a Dry Van was 2.21 per mile—Gross not long ago–I haven’t looked this week…….cyclical business rate averages—just bear with me —
1 truck doing 3000 miles is $6630 per week times 50 weeks is $331,500 per yr gross. AT only 50 weeks running per yr avg. Only running 4 trucks gets you in the 7 figure club— You have publicly trading companies running thousands. GRANTED– some do better, some do worse— some owner ops are making it on half those numbers gross— I have seen a few doing well for their vision at $157k per year per truck gross!! That is gross—-and not that is not fucking great numbers if you are questioning–but they make it work for them….
So always ask yourself what are they really FUCKING selling you?….then does it really guide and flow with your dream and vision?
THE TRUCKING BUSINESS IS A VOLUME BUSINESS.
The Average makes 8-14% after all expenses. At one point is was 16% not long ago, but the reality is most trucking operations and the needed volume just to operate has brought the volumes and margins down. Yes I hear the proverbial bullshit tooo—YES THERE ARE PEOPLE WITH LESS TRUCKS DOING MORE — but that is not common unless you really have the experience and the customers who pay premiums—-
THINK– KEEN TRANSPORTATION–AND THEIR 99YR CATERPILLAR CONTRACT THAT STILL STANDS TO THIS DAY—HELL THE FAMILIES EVEN INTERMARRIED……
Hell, I know of guys who gets rates that are considered “STUPID MONEY.” CONSISTENTLY. But the reality is they have made a name for themselves and their operation, and have EARNED that right! I promise you they are not running any freight for $2 a mile, and they damn sure do not touch any $1 per mile bullshit……..–
Dreams, Visions, and Investors wanted…
Tale of two different people
Owner operator and wife, team–wife does the office things, husband drives. A clear vision of owning 5 trucks. Runs, what I would consider regional, hauling containers. Owns a truck running, through a lease program, have placed their vision in reality, by finding a truck they desire to purchase to create their vision into reality. Created a LLC, and actually ended up purchasing 2 trucks this year through a two “private” loans. Going from 1-3 trucks in less than 30 days. Their goal is 5 by next year. The second truck was by surprise–however communicated to the people with the right vision–would I have purchase a truck overpriced as much as it was….no, but the terms made up for the price difference of $20k on the truck retail, and created a proper situation where they could profit. The risk was negligible after I heard the terms.
Calls me multiple times to discuss aspects of opening a trucking company. She has a dream. Wants to do a power only operation at first. Great! Obviously, I am going to ask questions to see who I could put her with for her first purchase of a truck. The first question I ask, “With your power only operation, are you going to be using “load-outs”, straight trucks, or running trailers for the bigger carriers–ie Amazon, JBhunt, ect. and just supplying the power?” “Have you got your authority, or will you run under another carrier?” I’ll just say her answer was in need of some more information. Then her rebuttal started with I am a black, woman just needing some help to get my vision on the right track. I just need $20k to get me going and I will pay the lender/investor back double his money in 1 year. I have no money, and just need this to get me started.
Who do you think an investor or lender will be more willing to grant a loan or capital investment into? Who would any individual that could place these people with a network, be more inclined to push for more funds for them to use, just on the basis of action, alone?
The obvious is Person #1—
Let me explain a little deeper–
First off, you can get your business and authority ready– with about $2500 excluding insurance requirements, and equipment (technically the equipment could be obtained by using O/O to start most of the time for free–not including running costs–if factoring– then that only will cost you about 48 hours of operational funds)– $5000 if you use a half competent attorney to file for the business entity— however, using an online service $2500 is realistic.
Second, if you think being a minority has any play with investors or lenders—you have done bumped your head or smoked some shit that got you stupid. The only thing “that box” matters to is the government- No one else gives a shit!
It is 2020—the only thing that matters is can you PERFORM–and as each year passes —education is mattering less and less, because ACTION always speaks louder than WORDS.
They–the investors and lenders— only care about three things. 1. Return of Capital 2. Ability to Act-Competently 3. Profits
Third, the fact that you are only looking for $20k to get you started tells me, and every single person that you are going to attempt to get money from that you have no idea what your numbers really are! That is a fact! Person #2 asked me– “Don’t you know some investors? I only need $20k.”
My reaction was as follows:
“Ma’am, first and foremost you have no clue what you are trying to get into. I would not even waste any investor or lenders time for you to get $20k, because they would tell me, I am wasting their time, after they speak with you. DO I have someone I could call–YES— but I am not raising $20k if I call— I am looking for $4.2MM– What you are asking for is a mindset —and yes that is all it is—-a different mindset completely. I know you may not understand this, however, you do not have the experience or the understanding of what you are asking for —and my suggestion is if you want to do what you say– find a trucking company where you can learn and understand the difference—then once you understand where you best fit and how you make money in the industry—-then and only then, will you be able to envision and create this dream. Go get you a job–$20k will not buy you a truck worth its weight in salt!”
Hell, even for my example purposes— $4.2MM is even small potatoes. I actually used that number, because someone had asked me what it would take for me to come on board to help build a Carrier out with them, and their board– my number was $4.2MM in the bank, $1MM my way upon agreement, annual salary from day one plus bonus, and 25% ownership—for their situation……
The reality after all this is simple, change your mindset–then you can change your reality– Dreams and visions are only produced through ACTION. Just because you bought a course, doesn’t put you in the exception to the WORK! If anyone tells you it is EASY—RUN–however, your mindset will get past any obstacle—or leave you standing where you are—–THE CHOICE IS YOURS!!
To big dreams, Clear Vision, and Action to take you there,