It’s probably that time of the year and you are considering what dynamic changes to make to the composition of your fleet of trucks. Or perhaps you are the new investor hoping to make a go at the Haulage Industry and you are caught-up in the dilemma of determining the optimal fleet selection and composition for your business.

The options open to you are really not far-fetched:

• You could decide to buy brand new trucks
• You could decide to lease (and there are various possibilities open to you here)
• You could settle for Used trucks

In this publication however, we will treat the option of used trucks while our subsequent editions will focus on the New and Lease Options.

To underscore the importance of this topic, follow us as we present you a related true-life experience:

A couple of years back, a businessman decided to go into the haulage business. His background was contracting so he decided to bring in an experienced hand to see the vision through. The experienced hand submitted a comprehensive business plan among which was the aspect that dealt with the Asset Selection. He presented three options:

Buy tropicalized new trucks locally from any of the OEM’s (Original Equipment Manufacturer) local rep with a proven record of impressive after-sales service and maintenance.

Buy Used (tested and certified okay) locally from well-recognized sales outlet

Buy Used from the international market leveraging on the competence of carefully selected buying agents with proven knowledge of the peculiarities of our local business and operating terrain

Each option was appended with the up and downside to ease the process of decision making.

Surprisingly however (but true to an average Nigerian businessman’s mentality), the investor set aside these options and decided to personally make direct purchase of the assets offshore working with a resident friend (also with minimal knowledge of haulage business). The resultant effect was almost catastrophic for the whole business initiative and nearly torpedoed the idea completely. How and Why?

Full-automatic trucks with very high sensitivity to diesel quality were purchased. With the widespread contamination of diesel in our environment, the impact of this sole variable on the trucks functionality is better left to imagination! Turbo chargers, rotors and injector nuzzles were changed at random right from the word go.

About 20% of the fleet on arrival had several terminal challenges ranging from faulty Transmission ECU, transmission system to gear-box failure, bad clutch system e.t.c. that grounded them for a significantly long period of time and almost undermined the profitability of the business.

Parts were very scarce and hence maintenance cost very high too. The combined effect of this was that trucks stayed too long in the queue awaiting repairs.

Drivers had a pretty tough time managing the trucks on the road (obviously, there is a dearth of experienced full-automatic truck drivers in the industry) hence series of reported incidents of truck malfunctioning in transit further aggravating the poor maintenance cost record.

Now, you can clearly understand where we are heading with this write-up.

Getting it right the first time is not just another cliché for the haulage business. It is ‘sine qua non’ for any haulage business seeking to succeed in this venture.

The Choice between Used and New Trucks

A used heavy duty truck will save you money up front, but if you’re using it for hauling, the existing wear and tear can result in a false economy.

When deciding between a new or used heavy duty truck, you have a few important decisions to make.

While a new heavy duty truck comes with a full warranty and is more likely to have a set of clean and functioning components, a used truck is often significantly cheaper. The risk is that you don’t know exactly the condition of the truck, and it’s possible that you’ll get a lower grade product than you pay for.

 

———————–To Be Continued in Part Two

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