Owner-Operator Reserve Account

No offense but I am NOT giving you any of my money to hold to fix my truck, you fix yours and I'll fix mine. You are going to have to pay big big money to get anyone to bite on that. I have been an O/O for 14 years and never had any one ask me for a escrow account. Any company that expects one is going to be sadly disappointed in the quality of drivers/trucks that a scam like that will attract. How much are you going to give me to hold to cover my lost wages when your trailer breaks down? Or you loose an account and now there is nothing for me to do?

 

what you describe is more of an escrow account than a reserve when you require a certain amount. an escrow account is for covering any losses an owner op may incur to you... a reserve acoount is for the benefit of an o/o, you have no business requiring an amount in a fund of this sort.

you could establish voluntary reserve accts where someone could put in what he wishes every load or every week and the owner op have open access to these monies.

what you are describing is a veiled escrow acct and not a reserve account. are you hiring true o/o's or guys that need their hand held??

or are you looking for a way to cover your rear?

 

Most carriers require owner operators to post a bond that is returned to them if they leave the company. But, I don't know of any carrier's who require owner operators to pay into a maintenance account that is controlled by the carrier, although some do offer owner operators the option for the carrier to deduct a specified amount into a maintenance account.

As far as your own trucks are concerned, you could put back from $5,000-20,000 per truck, although the high end is not likely needed with that many trucks. The idea of having a maintenance account is to have sufficient funds in the account to pay for any major repair. Some recommend owners have about $20,000, which is about what it can cost for an inframe. With 10 trucks you could put $5,000-10,000 per truck and that should take care of any major repairs. It is highly unlikely that you will have more than 2 trucks that need an overhaul at any given time. If you put more into your account, any unused funds could be used to expand or upgrade your fleet when the time comes.

 

We have stayed away from this but looking at doing an escrow to cover deductables. Typically you have money in a final settlement to cover most items and you have to just be smart about not advancing beyond what a driver already has loads run to pay for.

But for smart O/O's, a new O/O company that is looking for escrow is a red flag. Being a company driver and O/O mix company is also going to be a tough sell.

We need to add 20 trucks in the first quarter of 2014 and have been presented with the option of bringing on company trucks but it just doesn't fit mixing the models with small carriers. Larger carriers can pull it off.

 

Why not just contact a broker/agent and put the loads out there based on your equipment needs.

 

If an O/o is leasing on with you, you have no right to hold maintenance money for him. He is responsible for maintaining his truck, not you. If he fails to do so, youc an terminate his lease, but you can force him to put money aside for it unless he wants to. At least i would never lease in with you if you required that. No most companies require an escrow of 1000-2000 for insurance, qualcome, trailer deductibles etc. Most O/O will obviosly prefer the companies with 1000 escrow. FI they have there own trailer, excrow should be much lower.

 

I have a 3000 escrow where I am leased to but I pull their trailers and that 3000 is to cover anything I tear up on THEIR equipment. I do have a maintenance account with them that I put a percentage of my gross into. but that's at my own free will and I do collect interest on it just like at a bank. I can access that money whenever I want.

 

Timely topic, I was just contemplating this issue myself. Is $2500 escrow reasonable for an O/O leased on pulling a company trailer to cover insurance claims, damage, etc? How long would you give the O/O to fund the escrow - 2 months or ??? I have had a couple deals fall into my lap over the past few months that I have the opportunity for year round semi-dedicated freight but I am just a solo operator now. I was considering leasing other O/O but started putting a pencil to paper and the "what ifs" that came up brought this topic up this week.