One of the most frequent questions we’re asked by trucker, concerns the owner operator vs company driver dilemma.
Drivers ask “Which is better, working at a company driving job or becoming an owner operator?
The driving and knowledge skill set is the same for each job.
However, there are dramatic differences between these two types of truck driving careers.
If You Are Considering Changing Your Trucking Career
If you are a company driver pondering becoming an owner operator OR an owner operator thinking about selling your truck and driving a company truck, you need to weigh the various aspects of each type of job to choose the type of career that best suits your circumstances and comfort level.
- Taking a leap of faith to buy your own truck is a big risk. When deciding between owner operator vs company driver, don’t be in big rush to jump in. Time is on your side.
- Do NOT EVER think that an owner operator job will always mean more money in your pocket. That simply is NOT TRUE.
- There are many company drivers who net the same earnings or sometimes better than some owner operators. There are multiple influential factors which determine net earnings.
- There’s also more to a trucking career than JUST THE PAY CHECK. Making big money, but living on the road for 45 weeks of the year may not be your idea of the ideal driving job.
Carefully consider the differences between the two jobs. Know what you are getting into.
5 Factors Which Will Greatly Influence Your Success At Your Trucking Job
Whether you drive a company truck or own your own truck, there are a few factors which will determine the overall success of your trucking career.
- What trucking company you work for. Each has their ups and downs. What do you want from your trucking job? Are you willing to be away from home for long periods of time or not? If you work for a company which only has long haul runs, you won’t have much choice. Your company may solely run the eastern seaboard and you really hate driving in heavy traffic. Chances are you are going to be pretty unhappy. If you don’t see eye to eye with your assigned dispatcher, your blood pressure will run high, too! Get the drift? The company you choose to work for, will largely determine your job success and contentment.
- Your personal financial situation, when starting either trucking job. If you start the job with a lot of debt, there’s a pretty good chance than debt could increase even more, especially if you go from company driver to becoming an owner operator.
- Your financial needs. How much do you NEED to earn? High monthly bills? Champagne tastes on a beer budget? Do you tend to spend more than you earn? Do you normally carry a balance on your credit cards?
- How much time do you plan to work? Do you require time off for family obligations, health reasons? Are you highly motivated? Do you have financial goals and are willing to put in the time it takes to reach these goals? These variables will play a major role in determining your success, whether company driver or owner operator.
- Setting and sticking to goals. Do you have financial goals? Have you set career goals? Are you willing to put in the time to reach these goals? Are you a spender? Or a saver? Do you know how to manage your money? Are you living within your means? Does your spouse/partner have an income? These factors will greatly influence your job success and satisfaction.
Related Article > 5 Important Things You Should Know About a Career in Trucking
Owner Operator vs Company Driver — Job Differences
Company Driver Job – The Perks
- You get to leave the job and worries behind when you take the key out. One of the best things about being a company drivers, is leaving the job at the terminal when you are done working. There’s no worries to take home with you.
- Your free time is all yours. Your time off is your own. You aren’t spending your time off fixing the truck. No need to worry about company equipment, maintenance, paperwork, bookkeeping tasks, or cleaning your truck.
- Money earned is all yours. The paycheck you take home is your own. No truck payments, repair bills, oil changes, buy down deductible insurance, maintenance costs.
- Easy to change jobs. If you don’t like the trucking company you are working for or the type of trucking jobs, you can simply walk away without the worry of breaking any contractual agreements or losing money. It’s simply a matter of finding another driving job, more to your liking. I think this is a HUGE perk for being a company driver.
- Job security. With the driver shortage in full swing, company truck driving jobs are plentiful.
- No start up costs. Other than your CDL driver training, there’s no upfront cash outlay. Just jump in the truck and go and earn your pay.
Overall, a company driving job is much less stressful than that of the owner operator. Well trained, diligent truck drivers are in the position to seek out the type of trucking job they like and settle into a job with a company who treats them well and pays them fairly.
Related Article > What To Expect From Your First Year a Company Truck Driver
Company Driver Job – The Downsides
- Earn less money. Many company driving jobs pay a set mileage rate. Some pay rates will increase after X number of years of service. A company driver wage will eventually top out to a maximum. These jobs often don’t pay waiting time. It is NOT necessarily the case that the earnings of a company driving job will be less than the earnings of an owner operator. After the owner operator pays his expenses, a company driver may very well have higher net earnings than some owner operators.
- Less Home Time There can be less home time, especially for OTR driver. Trucking companies want to keep the wheels turning on their trucks. They know running company trucks are a cheaper, better deal for them, than paying an owner operator to do the same work.
Trucking companies especially in the U.S., not so much in Canada, tend to keep their drivers on the road for longer periods. It’s one of the big reasons the carriers have such a high rate of abandoned equipment.
- Slip Seating. Many trucking companies slip seat to maximize their profits. Trucks sitting against the fence while a driver resets his hours do not show a profit. Slip seating is a nuisance factor for a driver. You could be left to clean up the mess from the previous driver who’s a pig.
If you go to work and discover the driver before you hasn’t reported some damage to the truck, you can waste hours while the truck either gets fixed or until you are assigned another truck, most of which this time is unpaid.
To be properly equipped when on the road, there’s a lot of equipment you’ll need to haul in and out of the truck if you’re slip seating such as tools, food, clothing, personal supplies.
- Commuting Costs. If you live far away from the company terminal, you’ll incur some costs getting to work and home. It’s also inconvenient..
- Strict Rider Policy. Passengers are not allowed to ride with a company driver, without permission from the trucking company some truckers over the edge. A company driver must drive the truck he’s assigned. These are often bare bones trucks with no bells and whistles. Some truckers won’t drive anything but a certain engine/transmission combination. Company trucks are most commonly designed for functionality, not driver comfort. However, we understand some companies are paying more attention to driver comfort to help improve driver retention.
- Less Respect. Some carriers attempt to take advantage of company drivers.They will have drivers do the tasks that the owner operators at the same carrier, refuse to do, such as city deliveries, late night loading etc. We hear of many abusive accounts from mega carriers OTR drivers who are pushed beyond reasonable limits.
Owner Operator Job – The Perks
- Higher Pay. The owner operator has the potential to earn more money than a company driver, if he’s running his business efficiently. Usually, the owner operator gets paid for many of the extras, due to his contractual agreement where a company driver doesn’t. There can be significant tax advantages, lower tax rates, especially when incorporated, if the company is properly managed.
- Choose your own equipment. The owner operator doesn’t need to deal with slip seating and other drivers messing with his equipment and changing settings in the truck. The truck owner has equipment that is best suited for his needs and comfort. It’s great to be able to personalize the equipment to your liking, eg. a particular brand of seat, and set at a preferred seat height. The comfort level can be tweaked just to your personal liking. However, these comforts come at a high price.
- Be your own boss. Forced dispatch is not so much of a problem for the truck owner. The owner operator usually has more choice to pick and choose loads, although this depends mostly on the company. The truck owner has more control over his job, in general.
- Time off. Since the O/O is an independent business person, they can have greater flexibility to take time off work.
- Maybe a greater element of safety. If comparing the overall safety of the owner operator vs company driver, the owner operator may very well have an edge. He can choose a heavier profile, better quality tire with better grip for example. Companies tend to ‘cheap out’ on certain things like tires, and will buy lower quality rubber in bulk for their fleet trucks.
Owner Operator Job – The Downsides
- Financial risk. Purchasing a big rig can demand a sizeable cash down payment, and then there’s monthly equipment payments. The owner operator needs a wad of cash to start up at a new job. A credit card, money for a float for out of pocket expenses, and a wheelbarrow full of cash is needed. Many truck owners rely on company fuel cards. As an owner operator, your financial risks are high.
- Time off. Compared to the company truck driver, the owner operator may have a more flexible schedule. However, a substantial portion of the time off, can be spent doing maintenance and repair on your rig. If a repair shop is doing the work, you’ll still need to take the time to drop and pick up the truck at the shop, and perhaps wait for the work to be completed. It takes away from much needed home time. There’s also record-keeping tasks, and time needed to pay attention to the health of your small business. Sometimes there’s not much time left over to spend with your family and recharge!
- Greater stress. Due to financial risks and pressure, truck payments, unexpected expensive equipment repairs, unexpected illness, owner operators can endure a great deal of stress. Even when doing everything right, the unexpected can bring an owner operator down fast.
- Dependency on the trucking company. The truck owner depends heavily on the carrier they are contracted to, to provide them with sufficient miles to be financially successful. This is why it is so important to do the research to choose the best trucking company to work for. If they don’t have the work they’ve promised, or if their company trucks are their big priority, you can suffer financially.
- Changing jobs is expensive. Changing carriers for an owner operator is very expensive. There’s a hold back of money involved and contractual obligations and a period of time where there may be no income until you can secure something else.
- The unknown. Unforeseen breakdowns, health issues, family issues will directly influence your bottom line. Be prepared for the unexpected.
- Never ending responsibilities. It’s so important to pay attention to what’s going on in your business and constantly be checking your profit margin. If you don’t have the skills required, be sure to budget to hire the pros to help keep you in the profit zone or else you’ll find yourself in big financial trouble.
Related Article > The Biggest Mistake an Owner Operator Can Make
The Answer to the Owner Operator vs Company Driver Comparison? WHICH IS BETTER?
The true answer is one is NOT better than the other. Each situation for every trucker is different. Each trucker has different expectations of the job and different needs.
Some drivers are completely satisfied with a low stress company driving job. Others have the need to own their own truck, which comes with a greater element of control, but potentially, with more headaches.
It’s critical that you do the research to understand what you are getting into, whether it be as a company driver or an owner operator because there are some great rewards to be had from a truck driving career.
You must make the decision for yourself what you want from your career as a truck driver.
WATCH THIS VIDEO TO DISCOVER WHAT WE LEARNED ABOUT COMPANY DRIVER PAY PACKAGES.