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Step By Step
Rolling landscape, blue sky in your windshield—the independent American Dream makes truckers want their own companies. That requires trucking knowledge, dedication, business savvy and leaps of faith. Most of all, you must learn from mistakes and not repeat them.
Doug Bench and his son Zach, owners of CrossXLine Transportation in Blackfoot, Idaho, have traveled that path to trucking success. They shared their experience with Driver’s Seat.
Doug, you went from growing potatoes to growing a motor carrier. Was this your plan?
My plan has always been to farm and own a trucking company. I wanted to buy OTR trucks and deliver our own potatoes from the farm. My ex-father-in-law “didn’t know of a quicker way to go broke than to buy trucks.” I told him for every trucking company failure … I could find a success.
How did you start?
I received the best advice from the truck sales rep: “Become a company driver for a year and keep detailed records. Learn to make money as a company driver, then buy the truck and lease on to a good small carrier.” I did just that — got a company driver position at a local trucking company and spent my time researching the business of trucking. I still closely follow the business model I learned as a company driver.
Then I was really blessed leasing on with a very solid, small carrier who had an awesome customer base and positive image. Being leased on with that carrier gave me the chance to make mistakes, recover and learn. After three years, I got my hauling authority. Then I drove my butt off out of fear of failing.
I enjoyed being a lease operator. I was making good money, had two trucks leased on and was ready to add five more when the younger generation took over the company and changed the contract. It made me a glorified company driver with my own truck. I had to leave in order to make the profit margin worth being in business.
What business planning did you do before the big leap to your own authority?
Pretty simple: revenues vs. expenses and having a target to hit every month. I opened up a business account with my bank, received professional counsel from a good attorney and my accountant. I also asked a lot of other owner-operators for advice and looked at many large company O-O lease programs.
Zach, how old were you when your dad started trucking?
I was around 13 when Dad started driving. My initial reaction was “cool” because I loved big trucks. I remember the first trip I took with him to Arkansas; it was the coolest thing in the world, riding in the big truck with my dad.
Did you begin your career driving for him?
No, my first truck-driving job was for a local construction company when I was 19.
Doug, when was it decided that Zach was going to be part of the company?
It’s been my intention to have my three sons working together in a family business. Zach has done really well. He bought his own truck at 21 after one of the drivers commented that, as a dispatcher, “he didn’t know what it was like being on the road.”
He ran for two years to Ohio and back to Montana. He’s made way above the average income for a 23-year-old. He invested his savings into the business and is now our full-time dispatcher, doing a very good job making our independents money.
What was your first big mistake in business? Did it change your approach?
Trusting in friends who came asking me to help them. I learned real quick you can’t give someone success in business. Have a fair contract and never waver from it. Whether you’re running a farm or a trucking company, you have to run it like a business.
Any other setbacks in the first years?
I’ve been real fortunate with very few major equipment breakdowns. I think the biggest stumbling blocks were taxes and rebuilding a motor instead of putting that money towards a new truck. I learned to maintain my trucks well, but someday they have to be replaced if you’re growing a company. It just doesn’t make a heck of a lot of sense to have your favorite truck sitting around not generating money.
Zach, what’s the most challenging thing you do now?
Finding loads for our drivers every day that pay well, and also keeping up with drivers’ needs, problems, questions and concerns, to ensure they are successful owner-
What percentage of customer to broker loads do you handle? Do you use a load board?
35 percent direct customer; 65 percent broker. And we use Getloaded.
Doug, what’s your advice for anyone considering getting their own authority?
Do your research. Set a profit target each month and know your customer base will meet it. Don’t think you can survive from just the load boards. Stay away from factoring if at all possible. If you can’t operate on your own money or a cheap line of credit from your local bank, it might be better to lease on with a good carrier. By the time you add up all the increased costs of business to have your own authority, in many cases it’d be a whole lot simpler to run under a carrier.
What is the minimum cash amount for day-to-day operations to start a trucking company?
We figure it costs around $17,000 to add each truck until the money starts flowing.
Your biggest challenges today?
Learning to sit in this dang office chair. I’d much rather be driving. It’s been a hard transition, stepping out of my truck and trusting the driver to represent my company with customers who I used to see each week. We’re actively developing a new customer base and creating lanes for the trucks we’re adding.
What’s the future of trucking for small motor carriers?
With the new CSA 2010 regulations coming, us small guys willing to adjust our operations and do things right can service our customers much more efficiently than the larger carriers pushing drivers by dispatchers’ mismanagement. I have a very positive outlook for our industry.”
What do you see for the future of CrossXLine Transportation, Doug?
We’re staying on a steady growth pattern, servicing our customers’ needs to haul additional capacity as our economy improves.
Zach, what do you foresee?
The industry will keep “trucking on” through this hardship. The economy is looking brighter, and freight is always going to need to be moved to keep the country going.