Truck Owner Operator VS Company Driver; Which One is the Best For You?

If you are planning to step into the trucking industry as a driver, you can be confused about whether to be a truck owner-operator or a company driver. Well, there are pros and cons of both that you need to consider and compare before making a decision. 

The day-to-day responsibilities of both types of drivers are the same; however, the major differences are in the back-end responsibilities. Let’s dig deep into the topic to see which is best for you.

OWNER OPERATORS

Owner-operators are independent people who own trucks and associate with shippers, freight brokers, or both for work. There are three types of owner-operators; 

Lease Operators

A lease operator leases their truck from a reputed trucking company to haul loads for the company. This option isn’t very common in the US because drivers aren’t comfortable with their employer also acting as their lender. However, the plus point is that you can get a truck easily.

Lease-Purchase

In this concept, you’ve to lease-to-own your truck from a third party and get under a contract to start hauling goods for a freight company. This setup gives more freedom to drivers as you’ll be assigned loads regularly.

Self-Employed Independent Contractors 

Self-employed independent contractors secure their trucks on their own and associate for individual loads. This gives freedom to choose the load and route you want. You are completely responsible for all the business operations, including scouting and booking loads.

Pros of Being a Truck Owner Operator

The biggest advantage is that you are free to make all the decisions. You also make more money (as high as three times) compared to company drivers.

Cons of Being a Truck Owner Operator

You are responsible for the entire business and the risks associated with it. You have to bear all the additional charges, like truck payments, maintenance, fuel costs, insurance, taxes, etc. As a truck owner-operator, you’ll have to frame a business structure, maintain records, and file complicated tax returns on your own.

Not just this, but you won’t receive company benefits like paid leaves, health insurance, etc. This simply means you aren't making any money if your truck is not on the road.

Income

Truck owner-operators are paid either based on the percentage of load, where a fixed percentage of the entire load revenue is paid to you or mileage, where you are paid for the miles you drive. 

Percentage of loads don’t result in consistent incomes, however, you can enjoy some great paydays. On the other hand, mileage-based income is more consistent, but you would lose on occasional big paydays.

COMPANY DRIVERS

Company drivers are employees who drive a company’s truck, use their resources, and are paid on mileage or hourly basis. You don’t have to maintain a log book because your employer would do that.

Pros of Company Drivers

As a company driver, you don’t have to find your next haul and also get consistent paychecks. This means you can plan your expenses and EMIs easily.  You can also enjoy bonuses at sign-on and when you achieve specific milestones. 

Not just this, but your company reimburses meals and lodging expenses while you’re on the road. Additional benefits include paid leaves, health insurance, employee discounts, etc.

Cons of Company Drivers

The main downside is that you won’t be paid for time waiting for a shipper or receiver, and you won’t get the opportunity to sign-up for last-minute high-paying loads. Not just this, but company drivers have to work for more hours than an owner operator to earn the same amount.

Income

Company drivers are paid on an hourly or mileage basis. Some companies set a guaranteed minimum income so that you get some money in your hand when the work is slow.