How To Know If You Should Become A Company Driver Or An Owner-Operator

Truck driving can be a great career, but it comes with challenges along the way. Would you rather work for yourself or for a company? There is a lot to consider when it comes to the industry. Owning your own truck is really special, but it’s not for everyone. Being a company driver can be rewarding and challenging depending on your work schedule, but there are several perks as well. We get it. It can be hard to decide which way is right for you—an owner-operator or company driver? Let’s break down the differences between the two and help you find your best fit.

In the trucking industry, you will usually find the two main types of truckers, company drivers and owner-operators. While it may not seem important which one you are, there is a significant impact each of these career choices can have on a trucker, both in terms of money and time. An owner-operator is somebody who owns or leases their own truck and gets loads through contracting with shippers or freight brokers. Owner-operators get paid through either taking a percentage of load revenue, or by mileage, which is the more consistent option in terms of earnings.

A company driver is an employee of a trucking company, so they are treated as such. Company drivers use likely the company’s fleet or equipment and get loads assigned to them, so they don't book or seek them out themselves. The employer is the one booking the loads in this instance. Often, company drivers are paid by the hour, while long-haul is more likely to pay per mile. In order to know which trucking option is better for you, it is important to examine what the characteristics and challenges may be for each of the types of employment.

Owner-Operators 

When we are looking into owner-operators, the most obvious upside is that you are your own boss and will have a lot more flexibility in your work and schedule. With freedom comes decision making and a greater choice of loads. Aside from laws and regulations, an owner-operator can follow their own rules and set a routine that works for them, as well as choose when to take loads or how often. Since they run their own business, they can directly negotiate with shippers or brokers for loads. Usually owner-operators can earn more than a company driver during a good year, but it does take a strong business mindset and hard work. Owner-operators also can get additional tax benefits or deductions, due to being able to write off business expenses for running their company.

With power comes responsibility, and owner-operators know firsthand how stressful it can be to run your own business. As an owner-operator you will be responsible for business operations, including making sure registrations are up to date, maintenance, insurance, scheduling, negotiations and looking for loads. Owner-operators have to pay the expenses of running their business, including fuel, maintenance and insurance. You will be filing your own taxes and have to manage your own record keeping practices.  Keep in mind that owner-operators also do not get coverage that other company employees would receive, such as health insurance, benefits or paid vacation time.

Company Drivers

Company drivers may be restricted when it comes to schedule and choice of loads, but they do get a consistent salary. Often, companies will provide sign on bonuses or incentives for drivers in order to retain their workforce, so company drivers may also be provided with a few added perks. Usually, depending on the trip, a company will reimburse food and lodging expenses for a company driver as well, to a certain percentage. The company driver will have access to health insurance and vacation time. Perhaps the biggest incentive for a company driver is that they do not need to pay for maintenance, or any startup costs, as the equipment is owned by the company. Some companies choose to provide a base pay rate, meaning you cannot earn less than that per week, which guarantees at least some weekly income.

While company drivers do have more consistency in their work, they also are limited in the opportunity to earn more money, as they are assigned loads by the employer and cannot take on any loads they want. A company driver will also often have to follow a schedule, so if they arrive at a shipper’s and the load is not ready, they are usually (more often than not) not reimbursed for their time waiting, and their workday can be extended by no choice of their own. Unlike owner-operators, a company driver is restricted in that they cannot pick up a last minute load that pays well, so company drivers are more limited in their income potential. 

The Bottom Line

In order to decide whether to opt for a company job or become an owner-operator, it is important to consider individual needs and abilities. If you are a new driver with little experience it may be safer to start out with a company, which already pays for insurance and truck maintenance, so it is one less thing to worry about. If you are considering becoming an owner-operator then it is important to consider your finances and make sure you have money to start the business with, because it will take some time to break even and then begin making a profit for your work. Becoming a business owner is a financial risk, so think things through. Some seasons can be slow with little profit, so it will be important to have a savings or backup plan. Other factors to consider when deciding on your trucking venture include:

• Your Health: Make sure you can endure long trips, the stress of the job and can afford health insurance if you are becoming an owner-operator.
• Your Network: If you are choosing to become an owner-operator, you want to invest time in networking and getting your business out there, so that you have a better chance of booking higher paying loads.
• Your Family: Owner-operators do have more control over their schedule, while company drivers may expect quite a bit of time away from loved ones and long work hours.

The decision of whether to be an owner-operator or company driver is a personal one. Whether you choose one over the other depends on your particular situation and goals. Consider the impact these pros and cons have on you, in order to know what the best choice for you is. No matter what your goals are, there are ways to achieve them as both a company driver or owner-operator. You just need to find the right fit for you.