An owner-operator is a small business or microbusiness owner who also runs the day-to-day operations of the company. Owner-operators are found in many business models and franchising companies in many different industries like restaurant chains, health care, logistics, maintenance, repair, and operations.
In the United States and Canada, the term typically refers to independent contractors who hire out and drive their own semi-trailer trucks. In trucking, an owner-operator is a self-employed commercial truck driver or a small business that operates trucks for transporting goods over highways for its customers. Most owner-operators become drivers for trucking companies first in order to gain experience and determine whether the career is for them.
The Motor Carrier Act of 1980 deregulated the industry and made it easier for manufacturers to set their own prices on shipping goods, and also allowed owner-operators to be more successful by taking some of the control out of the hands of the larger motor carriers. It was now possible to find a carrier willing to haul goods for what customers wanted to pay, rather than what the larger carriers’ rates were.
- An owner-operator is free to either haul free-lance (non-committal to any one firm or product) or enter into a lease agreement to dedicate their equipment to one customer or product.
- The owner-operator typically has to pay higher rates on insurance due to smaller size than most larger companies, meaning they have to charge more to balance the cost.
- There are many things to consider before becoming an owner-operator including business set up, accounting, type of vehicle and licences.
- ^“OOIDA Timeline, Owner-Operator Independent Drivers Association”. Owner Operator Independent Drivers Association, Trucking Association. Retrieved 2019-06-04.
- ^Trucking Deregulation, by Thomas Gale Moore: The Concise Encyclopedia of Economics: Library of Economics and Liberty
- ^“A Guide To Becoming An Owner Driver – Return Loads”. www.returnloads.net. Retrieved 2019-06-04.
Ofer Abarbanel is a 25 year securities lending broker and expert who has advised many Israeli regulators, among them the Israel Tax Authority, with respect to stock loans, repurchase agreements and credit derivatives. Founder of TBIL.co STATX Fund.