4 / 1 'The lack of even the
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simplest business knowledge is frightening'
,T he idea of becoming an owner-driver is not usually a
rational decision. It takes root reading the trucking magazines' articles on owner-drivers and their amazingly smart motors. It can be fertilised by talking to drivers at cafes or at truck shows. It grows stronger as the need to find employment results in finding only unemployment. Finally the idea blossoms. What the hell, self-employment seems like a good idea. Exams are passed, licences obtained, the vehicle is purchased, advertisements for work are placed and eventually employment is "secured".
Six months later 25% of the hopefuls will be broke. Their lorries are repossessed and possibly their homes as well. So what goes wrong?
There appear to be two main problems. A total lack of business acumen among many of those entering the industry, together with a "death wish" from new entrants who appear to want to run only an expensive 38-tonne articulated truck.
What every prospective owner-driver should be aware of is that haulage is a service industry. Like any service industry there is no product to sell, just the ability to do a task that somebody wants done and for which they are willing to pay. The key to finding work is to identify where a demand for a service exists and to look for customers in the flesh, not in the back of trade magazines. Who you know can be as important as what you know. Owner-drivers need to use their contacts. If they have none it will be tough. Experience also is vital. Without it, going in to a new venture and suddenly having to take on all the responsibility is an almost impossible task.
Bigger than the problem of finding work, however, is the problem of staying in business. The lack of even the simplest business knowledge among many owner-drivers is frightening and it is a direct cause of so many going broke.
To be an owner-driver, on whatever basis, is to become an "independent businessman". If, as proprietor of that business, an owner-driver is not able to work out his costs or his rates, if he cannot keep a basic set of books and do his VAT returns, he can't forecast for himself and the bank or keep up-to-date sales and purchase ledgers, he will go broke.., sooner or later.
Most people entering the industry have never had any previous experience of running a business. While it is possible to learn on the job, it's far better to be prepared and to do a basic course in business management before starting out. I believe it is vital.
Every prospective owner-driver needs to take hard decisions and to ask himself some important questions. Is his aim to have a business that he can build up and develop or is his main concern to have a big shiny lorry? If it is the latter, then for his own sake, he would be infinitely better off attempting to secure a job as a driver with a company than trying to go it alone. Does he have any experience of driving commercial vehicles for a living, with all the associated regulations? Does he have any knowledge of running a business? Is he prepared to risk any money he may have saved or that is due to him, on a gamble into a venture where the risk of total — not just partial — failure is high?
Haulage is a very easy business to get involved in. But, with the costs, the risks, the low rates, the bad debts, the con-men and the lease agreements it is an extremely difficult business to get out of and an almost impossible one in which to make a good and profitable living. y E If you want to sound off about a road transport issue write to features editor Patric Cunnane.