In the first eight months of 2012, Alabama-based flatbedder WTI Transport signed over 100 new Lease Purchase agreements. That’s an exponential increase over the few dozen WTI had at the beginning of the year. Which should tell you two things.
1) With the difficulty of finding banks to finance truck purchases, Lease Purchase programs are quickly becoming the only way ambitious drivers can become Owner Operators.
2) The folks at WTI are doing something right. Particularly when you consider how many of their Lease Purchase drivers successfully take title to their trucks. “The main thing is, we don’t treat our program as a profit center,” says Lease Purchase Director Jason Quinn. “We created it because we really do want to see more drivers become Owner Operators.
“Our President Rendy Taylor has always said, ‘We can’t consider ourselves successful until a driver gets his title.’ That’s our philosophy. And drivers know that.” So what’s WTI’s secret? It’s no secret: They actually help their drivers succeed.
HERE ARE THE FIVE FUNDAMENTALS OF WTI’S PROGRAM.
1) Minimize The Down Payment.
Better still, says Quinn, don’t require any money down.
2) No Balloon Payments.
It’s pretty simple, Quinn continues: If a driver can’t afford a large down payment, he certainly can’t afford a huge balloon payment. After all, Quinn notes, that’s where so many Lease Purchase drivers at other companies lose their trucks.
3) Pay A Decent Wage. And Make Payments Affordable.
As of August of 2012, WTI was paying its Lease Purchase drivers 70% of gross. That’s as high as you’ll find in the industry. It’s why driver Andre Davis left another company for a Lease Purchase agreement with WTI: “With that other company, I had to run a minimum of 4000 to 4500 miles a week just to make any money for myself. Plenty of weeks, I owed them money.”
4) Offer A Fuel Routing Program.
A successful Fuel program combines maximum fuel surcharge with solid MPG practices, says Quinn.
5) Teach Drivers Good Business Practices.
“We think this is one of the real cornerstones of our program,” Quinn explains. “There’s a huge learning curve for anyone taking the leap from Company Driver to Owner Operator, so we created a Business Planning support system, to monitor our Lease Purchase drivers’ success in several key areas. Each Fleet Manager regularly reviews, with his drivers, a chart he keeps on those areas. Over time, the areas he’s marked red (problem) and yellow (potential problem) start turning green.
“So I guess, Quinn concludes, “you might say we aren’t really successful until our Lease Purchase graduates consider themselves successful Owner Operators.”