How to Choose: Independent Owner/Operators vs. Company Drivers

img via Flickr user Truck PR (http://www.flickr.com/photos/truckpr/)
Consumer markets couldn’t exist without commercial trucking, but if you’re running a company that needs someone to drive your products to manufacturing or retail facilities or other locations, knowing what type of driver to hire may not be obvious. Here’s an overview of what to expect from trucking options.

Two basic types of commercial trucking operations exist:

· Independent owner/operator: This type of driver owns his/her truck and trailer and takes care of all expenses related to driving and maintaining the vehicle. Often, an independent owner/operator owns more than a single truck and hires drivers to complete certain jobs. This type of driver is sometimes called a motor carrier.

· Company driver: These truckers are employees of a company that drive routes and haul freight as assigned by their employer. The company owns the fleet and usually pays for fuel, maintenance costs and other vehicle-operating expenses. Business is contracted through the company, not the driver.

The basic job for a driver is similar in both types of operations; it requires a CDL (commercial driver’s license), insurance and permits and the work involves driving a freight-loaded vehicle from one place to another. But the employment status of the driver changes things like pay, hours and other job components. So, for a company that needs to move goods, this means differences in cost and can also affect reliability of hitting delivery deadlines.

If you’re a small business according to your industry standards, here are some things to consider when choosing a type of driver to hire to transport your products.

Costs

A company with a large fleet can usually minimize per-truck costs by using fleet-management processes and advanced technology, including speed control, routing software and fuel management tools that keep costs per run down and improve other efficiencies. Yet overhead for large operations may be higher. After all, capital expenses and business operating costs (including driver salaries and benefits as well as insurance and fuel costs) must be spread out across the entire company. With small owner/operator, the cost of transporting your goods may be more directly tied to your specific route. The company’s business costs may include as little as a home office, the cost of the vehicle and trailer and expenses directly related to your route, such as the driver’s time, fuel and maintenance. The company’s business costs may include as little as a home office, the cost of the vehicle and trailer and expenses directly related to your route, such as the driver’s time, fuel and maintenance. Keep in mind that the trucker might send your invoice to a freight factoring company when you are billed for the service.

Process

Scheduling logistics with an owner/operator at your most convenient times, especially if your clients want just-in-time inventory, may be tough if the number of drivers available is limited. A larger operation will have more drivers available to complete your routes — and more resources overall if unexpected problems occur, such as weather-related delays or vehicle maintenance problems. But a large company is likely to have detailed processes in place that may make it difficult to make last-minute changes to your order or communicate instructions to a driver.

Reliability

In both types of businesses, you want to verify that your freight is insured for damages that may result from an accident or weather disaster. But keep in mind that a minor accident, driver illness or lack of dispatcher for an owner/operator may mean delays that you wouldn’t necessarily experience with a large company that can offer more support to the driver en route.

As with most decisions, each trucking option has pros and cons. To figure out the best setup for your transportation needs, talk to reputable providers of each type of company, look carefully at the total costs, make sure your candidates are able to actually complete your work (that they have the right equipment and licenses, for example) and then choose the option that best meets your needs for the best price.

HGV Express provides HGV training, advice and support to get started as a professional HGV driver. From which course and where, to getting accredited and obtaining your first job, we`ll be there to organise, support and advise you every step of the way.

There has never been a better time to start a career as a HGV driver. As there is currently a large demand for HGV/LGV drivers, salaries are at an all-time high as companies across the nation compete for available drivers. This means a new driver can earn more than ever before.

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