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Becoming an Owner\Operator

Putting Together a Winning Team

This is part five in a series of articles we are writing to help guide you
through the process of becoming an O\O. In parts one through four we covered
the first seven steps. Just to jog your memory here they are again:

1) Decide what kind of operation you want.
2) Choose a carrier.
3) Spec your equipment.
4) Finance your equipment.
5) Choose insurance

6) Sign the contracts
7. Choose a business entity

In this column we are going to help you put together a winning team. What we
mean by that is, you need to surround yourself with qualified people who can
help you succeed. Did you know Henry Ford never finished high school? During an
interview, a reporter trying to show that Henry was not very intelligent kept
asking him technical questions. When Henry couldn’t answer the questions the
reporter started to heckle him about his lack of knowledge. Mr. Ford responded
by picking up the phone and asking one of his employees the question. After
another question he did the very same thing. Then he turned to the reporter and
said. “I don’t need to know all of the answers to run a successful company. I
have hired people to answer these questions for me so I can concentrate on
steering the ship”. This is excellent advice for anybody in business. Remember
being an O\O is being in business. This doesn’t mean that you don’t need to
know anything but you don’t need to reinvent the wheel. Find good qualified
people who can assist you and take their advice. You might think as an O\O just
getting started that you are too small to get any real help. It’s not true. It
may be a little harder but if you are persistent you can find the help you
need. As an O\O you will want to seek out people in the following areas:

  Tax and Accounting
  Financial Planning
  Legal
  Insurance
  Maintenance
  General
  Engine
  Tire

Tax and Accounting: This is a critical area. A lot of businesses go out of
business because of poor accounting or bad tax planning. There are different
levels of qualification for tax preparers. Most people assume that you must
have your tax return done by a CPA. This is not true. Anybody can charge you to
fill out your tax return. There is no license or certification required. When
you are looking for a tax preparer you want to look at their experience in the
industry rather than their title. We have known tax preparers with no
certification who do a much better tax return than some CPA’s. If you really
want somebody who knows the tax code you may want to look for an EA (Enrolled
Agent). Most importantly though, you want to ask them how much experience they
have in the trucking industry working with O\O’s. What percentage of their
clients are O\O’s. You also want to find somebody who will work with you in tax
planning, not just filling out your tax return. This person or company should
also be doing your bookkeeping or should work closely with you in setting up
your bookkeeping if you decide to do your own.

Financial Planning: A lot of people are intimidated by the idea of financial
planning. Financial planning doesn’t need to be complicated. A good financial
planner will be able to simplify the whole process for you. Having a good solid
financial plan, especially if you are in business for yourself, can make the
difference between retiring a millionaire, -yes we said a millionaire- or just
getting by. If you have any doubts that an average person on a modest income
can ever become a millionaire, you may want to read the book “The Millionaire
Next Door.” Tax planning and financial planning go hand in hand. Either one can
have a huge impact on the other. Ideally your tax preparer and financial
planner should be from the same firm or they should be willing and able to work
together. We feel so strongly about this issue that we now have a financial
planner on staff. There are different designations for financial planners such
as; CFC (Chartered Financial Consultant) and CFP (Certified Financial Planner).
If your planner is a registered securities broker then he will also be able to
buy and sell stocks and mutual funds on your behalf. Very often you will find
planners that work at your bank or insurance company. We recommend that you
avoid using their services because they tend to be less experienced and they
offer a much smaller range of investment products.

Legal: You probably won’t need the services of an attorney very often, but it
is a good idea to interview a few ahead of time so that when you need their
services to review contracts or settle disputes you will have someone already
in place. You can call your local bar association to get referrals on attorneys
who handle small businesses.

Insurance: A good insurance agent should look over all of your insurance needs
and make sure you are adequately covered. They should help you get the correct
amounts of coverage for your needs. They should also be there to help you when
you need to file a claim. When possible you should try to use one agent for all
your insurance needs. That way the agent can determine if you have proper
coverage for all of your exposure. For more information on choosing an
insurance agent you can check out part three of this series which appeared in
the July issue of this magazine.

Maintenance: A good mechanic can be a real blessing to a beginning O\O. Even
though you may be traveling all over the country, and may not always have your
service work done at the same shop, it is still a good idea to find a good
mechanic or shop, and build a relationship with them. When you find a good shop
ask them for their advice on service intervals and any other questions you may
have. If they are doing a good job for you, don’t try to haggle on price or
make a big deal about minor issues. It never hurts to stop in once in awhile
and bring the mechanics lunch. By developing a good relationship with them you
will then have a resource that you can call on when you are on the road and
have to have work done at an unfamiliar shop. For instance, if you are getting
work done on the road and their explanation of the problem doesn’t make sense
to you, or the bill seems unreasonably high, call your local shop and ask them
for their advice. You can even have them talk to the shop for you. Remember you
have to take the time and build the relationship up front so that when you need
the favor they will be there for you.

Trucks are getting more and more complex every year. that reason it’s best to
use more than one shop. The majority of your work will be done at a general
repair shop. Because of engine electronics you may want to use a shop that is
run by your engine manufacturer. You also will want to find a good tire shop.

Building these relationships will be the foundation for your winning team. Just
like the foundation of a building it has to be done one brick at time. Don’t
rush the process. Remember, if you want your team to be loyal to you, you need
to be loyal to them. Once you find good people to surround your business with
don’t hesitate to recommend them to other O\O’s. This is part of your
contribution to the team effort. Keep in mind this is not going to happen
overnight. Just keep working at it and before you know it, you will have
resources available to you that will help you run a successful & profitable
business.

This article has been researched and written by The Alliance, a company which
provides bookkeeping, tax planning and income tax preparation services along
with operating its own small fleet for 13 years. The Alliance deals exclusively
with O\O’s and drivers in the transportation industry. If you would like more
information about anything written here please contact Kevin Rutherford at
866-438-7825 or E-mail me Kevin@trucksuccess.com.

Chapter  1,
2
, 3,
4
, 5