Podcast: Are Major Carriers Nothing More Than Starter Companies?

Hey everyone, we have another new episode of our podcast "The Road Home" and it's titled:

Are Major Carriers Nothing More Than Starter Companies?

It's common to hear drivers say you should start your career with one of the major companies but then move on as quickly as possible to better jobs with smaller companies. But is this really true? Are large carriers nothing more than starter companies? Are the best jobs found at smaller companies? We'll examine all different facets of life for a driver at a small company versus a large company, and we'll explore the economics of the industry to see if this notion of starter companies holds true.

Enjoy!

Are Major Carriers Nothing More Than Starter Companies?

Starting with a larger company is always your best bet to start in the trucking industry. But are they nothing more than starter companies? that I don't know. From an insurance stand point, 90% of the insurance companies require a minimum of 2 years of trucking driving experience for them to insure a driver in a smaller company, some of them will make an exception for 1 year if there is only one driver or 2 depending on the size of the with just one year experience and none of them will insure a small company that uses driver trainees. I have seen many companies be dropped by their current insurance company for having hired someone with just 1 year experience.

Hey everyone, we have another new episode of our podcast "The Road Home" and it's titled:

Are Major Carriers Nothing More Than Starter Companies?

It's common to hear drivers say you should start your career with one of the major companies but then move on as quickly as possible to better jobs with smaller companies. But is this really true? Are large carriers nothing more than starter companies? Are the best jobs found at smaller companies? We'll examine all different facets of life for a driver at a small company versus a large company, and we'll explore the economics of the industry to see if this notion of starter companies holds true.

Enjoy!

Are Major Carriers Nothing More Than Starter Companies?

This was quite possibly the best podcast released to date. As someone who will make the jump in the next 1-2 years, I'm gathering as much info as I can. The decision of large vs. small was probably the #1 question. And what Brett covered makes sense. I work as a federal contractor and I've been an employee of the big and the small contracting companies. They each have their pros and cons but, overall, the larger companies seem a better fit with regards to coverage, options, and benefits (like free weight-loss clinics and mental health support). Well done, Brett, and please keep them coming.

Great podcast and I agree with 99.9% of it. The only thing I can see where there would be a difference is when a driver potentially looks at more specialized sides of the industry such as some tanker, dry bulk and specialized flatbed / heavy haul type work. The major carriers don't dabble in that type of work and quite a few of those type carriers want to see at least 2 years with s some wanting 5 or more years of experience. They'll also tend to be at the top end of the pay scale and for consideration, reputation is everything. I know it really has nothing to do with newer drivers just starting their career but maybe just something for them to keep in the back of their mind.

Keep up the good work!!

Thanks Paul and Robert!

The decision of large vs. small was probably the #1 question

That's a big question for a lot of people. We all hear the "you're just a number at a large company" thing, and we all hear the "family atmosphere at a small company" thing but I've never felt either of those were the case. I was certainly not just a number at any large carrier I worked for and there was no sense of a family atmosphere at any of the smaller companies I worked for, and one of them was run by my cousin! So it was literally a family affair at that company, and my cousin is one of the kindest people you'll ever meet. But if anything, work was work and family was family. When we were working we were all business. When we were at family gatherings it was all fun. But there was no 'family atmosphere' at any small companies I worked for, not even the one my cousin was running.

The other thing people often fail to realize, and I should've mentioned this in the podcast, is that you're a much more important player at a small company. That's not a good thing. They rely on you far more heavily at a small company than at a big one. If you decide to take a couple days off at a company with 10 trucks they've just lost 10% of their fleet, in an industry with 3% profit margins. That's not good! At a large company you can take a month off and no one but your dispatcher would even notice.

The only thing I can see where there would be a difference is when a driver potentially looks at more specialized sides of the industry such as some tanker, dry bulk and specialized flatbed / heavy haul type work. The major carriers don't dabble in that type of work and quite a few of those type carriers want to see at least 2 years with s some wanting 5 or more years of experience.

To some degree that's true, but not to a major degree, because there are a lot of exceptions. For instance, Prime has food grade tankers and Schneider has both bulk and chemical tankers. And most flatbed companies do oversize/heavy haul.

But there really isn't a large volume of specialized freight and if that type of stuff paid really big bucks then why wouldn't competitors swoop in and steal some of that thunder, right? Well in fact they do. So again, there goes those big, fat profit margins everyone hopes to find by going into specialized freight. And without big, fat profit margins you don't get big, fat salaries. You'll make really good money, but not much different than most drivers. Heck, Old School does drop-n-hook standard flatbed with a major carrier doing little or no tarping and makes more than most attorneys!

G-Town hauls box vans to Walmart, gets home regularly, and makes great money too.

So I think the idea that "all the big money is in specialized freight" is another one of those notions that many people have but I don't know if there's a lot of evidence to support it. Like I said, there's good money in it, but I don't know that it's much better than anyone else is making.

And the experience requirements that most companies have are set by their insurance company. It's not that they necessarily need someone with five years experience to do the job, but their insurance rates will be a whole lot lower that way. In fact, how many trucking jobs can you think of where you really need someone with years of experience? Very few.

Very true but there are some out there who are more particular and want those high mile safe drivers because they run top of the line equipment but you're right, they are few and far between. I do think that companies like Prime , Schneider etc aren't going to want to get into heavy haul for instance because of the equipment needed, training involved and the experience you have to have from the drivers. Not that any aspect of the trucking industry is easy but there are those sides which are much more difficult.

I think you'd have to pull numbers to really see how much better the specialized guys can make. The biggest difference would be that they don't have to drive near the miles to bring a bigger paycheck but again, that's experience coming into play along with so many other factors.

I think that was my favorite podcast, so far. Great info, Brett.

One question comes to mind, though.

What would the threshold be for a Large, vs Midsize, vs Small carrier? To me, being in the hospitality industry, A large company, such as Delaware North, has over 1000 employees, which is HUGE!!! but as an apple to orange comparison, Every company that I have considered, except maybe 1 or 2, has much more than that.

My company, Personal Touch Food Services, has about 200 employees, and is considered "semi big." The site I work at, I am 1 of 3 chef's, rotating 21 meals a week, for 100 nuns + school, administrative, and support staff, and their retreat center. In all, there are 12 of us, at that site(food runners, dishwashers, and part time event hosts). But that would still be enough to staff a small cafe, or restaurant.

This podcast, has definitely opened my eyes, as to what could be considered a mid size carrier, like Gypsum 512 truck? or is that "small?"

Swift, obviously is a BIG carrier, as is Knight, Schneider, Werner, Prime, and Roehl, i think.

This is just one of the many random questions that sometimes pop up in my head, when I go through the forums, and other resources, at my disposal.

Keep up the great work!

That's a pretty good question DanielSahn. I'm not sure if business wise, there's a determination based on number of trucks?

In my world (insurance ) 1- 20 units is considered a small fleet , 20 - 500 are considered a medium sized fleet, 500+ are considered a large fleet. that is in the insurance world.