Employed drivers vs subcontractors

Thinking about starting a trucking business? One of the thoughts you might be having is whether you'd be hiring drivers as employees, or be partnering with subcontractors? Both options have their advantages and disadvantages. Let's talk a bit more about those.

Employed Drivers

The main difference between an employed driver and a subcontractor would be the ownership of the truck/vehicle. Owner operators are drivers who operate their own truck(s) , while employed drivers operate & drive the vehicles you own . If you choose employed drivers over owner operators, there are many things you need to take care of, including:

Supply drivers with vehicles, which requires big amount of capital
Maintenance of vehicles
Fuel expenses
Repairs
Vehicle insurance
Drivers will complete the tasks as per your schedule

Subcontractors

These drivers are not employed by you, rather they work independently by driving their own trucks and delivering loads, which means :

No need to supply them with trucks
Maintenance depends on them
Fuel expenses are their burden
Repairs are on them too
Vehicle insurance, them again!
They work according to their time schedule
May charge higher than employed drivers as they use their own vehicles

Both options have their unique advantages & disadvantages, you as the business owner must access your financial capabilities & future goals in order to decide which is the better option for you.

When To Consider Hiring An Employee

Some of the main points you must consider before hiring a driver/employee, you should consider hiring an employee if:

You want the work to be done under your supervision, this will also increase you workload and monitoring load, but also increases your control radius

You want to control the hours of work and the vehicles and equipment used by the driver. This will increase your costs by a big margin, and you'll also be responsible for taxing and repair of the vehicles

If the work is long-term. If you don't want the stress to find independent truck driver every time.

If the driver is the essential part of the demanded task. In truck dispatch business, a driver indeed is an essential part. You'd want to find a professional who is consistent on getting the job done in time.

When to Consider Hiring An Independent Driver/ Owner Operator

If the owner operator is a professional who has been in the industry for a good amount of time, and doesn't need to learn the basics of the truck dispatch business

You are limited on the capital amount and don't want to spend on buying the trucks and equipment for your trucking company.

If a specific dispatch task is short-term. For example: You as a truck dispatch business owner decided to buy equipment for your Power Only Dispatch Services because you focus primarily on that specific service, you want your equipment to be operated by someone whom you can supervise (An employed driver) But, for Reefer Dispatch Services, you want to hire an owner operator who owns their Reefer equipment.

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