Long Haul Trucking Paying 90%......REALLY?

You guys are right that many o/o get hung up on the gross percentage. It seems that more and more people don't want to sit down and do actual math when it comes to their pay...they would rather just have it handed to them in one simple amount and no explanations. Had a company driver try to tell me I was getting robbed paying 23% of the gross doing LTL reefer when his Dad was getting 95%. Well when I started throwing cost deductions at him he realized that 95% was actually paying worse than my 77%. After all was said and done his dad was making about $0.30 less a mile running the same area as me.

 

Yup, people get caught up with a single number because it sounds good.

Anyone who can't give you all the numbers, the gross rate, the percentage, the deductions, etc. is blowing smoke. But then you also have common senses. A percentage starts getting so low that the company can only hope people don't ask questions.

 

By giving Owner Operators 90% we are getting the margins as close as we possibly can. Which ultimately means that if you perform well, you will have more money in your pocket. As far as the costs you spoke of: the 2% FSC, is to benefit the Owner Operators because if Long Haul trucking didn't finance that 2% the drivers would have to wait for 30, 60, or 90 days or until the shippers pays versus being able to receive the money when you get paid for the load. The $17.15 Trip Pack is now scanned so driver's trips get to the office the same day delivered to make the process faster for the driver. The $14.00 Prepass is optional expense and can be purchased at the owner operator's discretion. OCAC is required by federal law, however, if you do carry your own you are able to use that. Our cargo insurance is higher because we haul high value loads that require higher liability and our rates reflect this. Customers are willing to pay a higher rate to ensure that they receive our higher quality drivers and services. As far as the 5.05 cpm for cargo dose not equate to an extra 14 % when added up, that is why we pay percentage so they run less miles at the end of the month and Quarter for more revenue and LTL whenever possible,

 

I am just curious about what you drivers that are leased to a motor carrier are generating in annual gross revenue? When I was leased I made $137,000 the first year and $163,000 the second. Since I got my own authority I have been at over $220,000 last year and will most likely hit $260,000 this year. I pull a flat bed, run 140,000 miles oer year and work only about nine months.

The idea of being an O/O is to own your business, generate revenue and make a profit. Chew on this fir a bit instead of trying to pick a carrier who will rip you off the least.

 

Could you explain how you run 140,000 miles in 9 months? That is 15,500 miles a month, or 520 miles per day. I was just doing quick math, but it would seem you would have to be able to run 65 mph for 8-9 hours per day, and not log any other on duty time. You would have to do this every day for the 9 months you work. Knowing the flatbed business it seems a little hard to swallow.

Your gross numbers are equal to slightly better than what my independent contractors make per mile. They get paid 68% pulling my trailer. I would imagine their cost structure is significantly lower than yours. They don't have any risk of customers not paying. They don't have to book their own loads. They also get fuel discounts, and other support from our company. Not everyone has the discipline to be a true independent, but I salute you for being successful at it.

I am only trying to point out that it is possible to be successful when leased to a carrier.

 

At those kind of numbers seems you'd be much better off leased on somewhere.

 

Since I have the attention span of a hamster..Have to break in and say congrats on your 15th anniversary with Pape Trucking!! Saw that somewhere else..

Now back to the topic at hand..I apologize for interrupting-but I'm in a hurry..

 

Thanks...it is a bit strange to think of my "time" spent at Pape. Seems more like I have always been there and probably always will be.

 

ocac is not required by federal law, I am leased and we aren't required to have it. you are wrong. and the 2 percent is for financing the fuel surcharge, I hope you don't really believe all you posted.


you must be a Washington dc spin doctor when you aint longhaulin

 

Desk Jockey it maybe more like 10 months or 300 days. I generally run 12k per month. Running long haul I try to drive at least 600 miles per day, 700 if west of the Mississippi. Fortunately my runs the back office, booking loads and keeping me moving. She usually has me booked a week to ten days out. successful ally run six days, parking Saturday night and Sunday for a 34 restart.

The reason we obtained our own authority was to cut down our expenses, increase revenue and keep moving. The problem we had when leased to a couple of companies was their inability to keep je booked, plus paying their high insurance premiums, computer and high dead head. My cost of doing business didn't change much when we switched despite the fact that we had to buy a new truck last year.

I agree that not all O/Os have the ability or discipline to operate independently. Many i have met operate like company drivers and haven't a clue to their operating expenses. They would be better off leased to a company but are too darn stubborn in their ways. I will also agree that it is possible to be successful leased to a company. All you have to is look at companies like Landstar, Mercer, etc. It just wasn't right for us.