Can I vent just for a minute.........

Truck payment is $32k/yr. I have a 2019 International LT that I purchased brand new from the dealership. I spent about $36k last year in fuel. $68k came with down payment on my truck, truck insurance costs, tolls, IFTA, obtaining my authority, attorney fees, state license fees, etc.

This year, my overhead will be higher because Progressive increased my premium by 50%. Fuel will be almost the same. I calculate my fuel as a fixed cost since I try not to go over $700 per week on fuel. With fixed and variable costs, I’m calculating total overhead costs at $2,237/wk.

Prior to COVID-19, my gross profits were $3,000 to $4,000/wk. This left a net profit of $763.38-$1,763. I take 20% for salary and 70% is reinvested in my company.

Currently, Net profits are down by as much as 39%. This 39% is what I requested from the SBA EIDL loan.

Can my business survive with a profit loss of 39%? Yes. But that’s not the point. The point is that the loan program was established for companies that have been impacted by this national epidemic.

It’s a loan not a free hand out. Why shouldn’t I utilize all tools that are available to my company? Someone presents to me an investment into my company for $100,000 for 20% equity in my business, should I turn it down. $100,000 can be used to expand my business such as purchasing a truck and hiring a driver that could increase my profits by 50%. Or, I could pay off my current truck and increase my profit by 50%, use that 50% profit increase to purchase a second truck increasing profits to 60%.

Hopes this answers your question.

 

I never said that I would use the money for expansion of my business. Although, there are business owners that have done just that. The loan can be used to pay truck notes, insurance, rent, utilities, etc.

I requested the money specifically to cover the cost of insurance. Again, the specific’s that I requested was only to cover the decline in profits which for my business is like $23k.

Since Progressive increased my insurance premium by over 50%, a huge portion of my gross and reserves has been allocated to paying Progressive. Please go back and read my posts on this subject if it’s not clear for you.

Since January of this year, Progressive has demanded that I pay over $13,000. That’s up front money which has to come from money on reserves.

As I stated in another post, It’s something I have to deal with until I can find another insurance company that will not do what Progressive has done to me.

I have 3 payments left with Progressive and should be paid up my September. In October, I will be able to shop around for a better insurance company.

By December, my authority will be 1 years old and my insurance agent will have better insurance companies for my business.

As I said before, my business will survive this epidemic but I’m not going to sit here and pretend that my profits haven’t been effected by this epidemic. It has and my profit and loss statement shows this. My overhead remains the same regardless. Thus it would be adventurous for me to apply for the EIDL loan which I did. Sadly, they declined my loan offer (which they offered to me $50,000 and I requested $24,000). A $1,000 was advanced to my company which I immediately paid to Progressive Insurance Company. That would have left $23.000 which I would have allocated to the remaining payments to Progressive plus partial payment into next years insurance premium payment.

Next year, my insurance premium will be half of what I’m paying now as a new entrant and that money would have gone to pay back the EIDL loan by December of 2021.

So, again, where’s this free handout/wannabe welfare queen that the other poster suggested? My offer still stands, let’s compare financial data and you educate me on where I’m going wrong and perhaps you can educate me on something I’m missing.