Rates are crashing and fuel to the moon!

I’ll take my chances of working 3 hours and then being available for 3 more 3 hour loads and still getting done 2 hours earlier.


There are easier ways to make 50 bucks

 

I’m for easy too when it comes to 50…..Minimum wage was 3.35 an hour in 1990. 4.50 hr was still unskilled labor wages

 

What....? No wonder why the business is the way it is... I cant believe i just read that

 

If you work 3 hours 5 times in a row, you will put in 1 more hour of work but make 750 dollars more. Than your piddly 250 bucks for 14 hours totals... Scale that out to a month , a quarter, a year... the difference is astronomical.... If you like to make 250 bucks for 14 hours of work i think you could do better a swift or western express honestly

 

If there weren't a way to crank out a few more of those short runs, I would take the $66/hr profit for 3 hours work vs $17.85/hr for 14, drop my wagon, and go sell some trucking. Sounds like a great opportunity to prospect

 

The old saying work smarter, not harder comes to mind

 

This is one of those things that there is no "RIGHT ANSWER", and the real world results often end up being counter intuitive.

Given a stable demand, higher prices result in lower volumes and lower prices result in higher volumes, because in theory buyers are priced out of the market. Given a stable production price, there is an inflection point where cutting prices to raise volumes results in a net loss. Increasing supply lowers demand, which lowers prices. Increasing demand will raise prices, which will increase supply until demand and supply end up in balance. Econ 101, right?

But that's not how things actually work. "Economies of scale" doesn't mean "cheaper by the dozen", it means that costs change relative to size. Doubling production may triple costs. Raising prices may increase demand. Restricting supply may cut demand. Increasing revenue per mile is good, assuming stable miles. Increasing revenue per mile while decreasing miles is also going to increase cost per mile as fixed costs are going to be a larger proportion of costs. If the revenue increase doesn't offset the cost increase, then the driver is actually losing money.

Given a choice between two runs that both take 12 hours start to finish:

• A) 464 miles and 1.5 hours of working the dock, total $511
• B) 478 miles and 1 hour of waiting time, total $487

In theory, run A pays $2 more an hour. In terms of pay for effort, B is better. But total time remains the same, so the question is taking a nap worth $24? It depends on the person. Applying the extra income from A to a mortgage will cut 10 years off a 30 year loan. That's a good trade off.

If the choice is between two runs that start and end in the same place, and the next load is the same - do you still choose the $200 3 hour load? The other 11 hours are wasted either way, so why not make an extra $50?

This is one of those things that separate the successful O/O's from the continual influx of 'yet to fails' - being able to understand and calculate their earnings compared to various benchmarks and choose the 'optimal' path. Taking a lower revenue per mile/per day load may make sense if it allows for a 34 and ends in a good market. Taking a high revenue load may be insane if it ends in a dead market. It's an art underlied by science. The problem we have is too many people taping bananas to the wall and calling it art.

 

This is not exactly an apples to apples comparison. So it doesn’t apply here, but that said your 24 dollars is before tax. It’s really only going to net you 18 bucks after taxes. So it’s 6 one, half a dozen the other.

Again this is a purely hypothetical question. That doesn’t really apply to the context of the argument, but I will indulge. In theory if trucks operated in vacuums, and one would be foolish enough to do this. The $250 would be a smarter choice. However trucks do not operate in a vacuum. You will make better time running an empty truck than you will a loaded truck, you also make your truck available to move another 300 miles. So either way at some point you will either A.) eclipse the other truck and end up with more loads loaded out of point B which will net you more. Or
B.) you will pick up one or more other 3 hour loads. Again which will yield a net gain.

And this doesn’t even take into account that an empty truck is cheaper to operate.

Lower revenue has zero to do with lower net profit. I’m on my way now to move a load that pays $800. That’s pretty low revenue, but it moves 3 miles and it’s on my way to the next load. A load in which I have already priced the deadhead into. So while I won’t say that 800 is all profit, it’s as close as one gets.

 

Lower revenue does contribute to net profit. Fixed costs don't change. There is a point where running less miles for a higher rate results in a lower net.

This is the same argument of running 65 vs 60 mph - there are times when it makes sense to run slower for the better fuel economy and there are times when fuel economy be ######. Sometimes less is more, sometimes more is more. Its about the whole picture.

 

I don’t really know what point you are trying to make. Do you agree with working 14 hours for 250 profit or do you agree with working 3 hours for 200?

I’m a little slow sometimes, but it seems that you are straying from the topic. They guy I originally quoted sounds like one of those guys that say “I have a daily revenue goal I have to hit” and come hell or high water he’s going to hit it. But in the same breath says he’s not paid what he’s worth.

The fact of the matter is, he is not confident in himself or his abilities to demand what he considers fair pay. He’s afraid that if he doesn’t take a subpar load that nothing else will come along. He says that if he can get his per mile rate up, but his revenue will go down. And it just might. But his profit will rise. He says it won’t, but he hasn’t tried it. So he really doesn’t know.

Let’s do some quick math. He said his numbers are the same as the guy in the video, so we will use those numbers.

1.65 break even and 2.30 all miles. We’ll use 10,000 miles a month.
1.65x10000=16,500
2.30x10000=23,000
23,000-16500=6,500

I suggested he get his all mile rate up to 2.58 which is roughly 12%. So let’s say that causes a 10% reduction in miles. We will say this lowers his overhead by 2%. Because just like fixed cost, you have lots of variable cost.

1.65X.02=0.033
1.65-.03=1.62
1.62x9000=14,580
2.58x9000=23,220
23,220-14580=8,640

that leaves us with a total net gain of
8640-6500=2,140. And a thousand miles less every month. You went from around 40% gross profit to 60% gross profit. Working less. How is that not a win/win. That’s what a 12% rate hike will do. But let’s say it causes a 20% reduction in miles.

1.62x8000=12,960
2.58x8000=20,640
20640-12960=7,680

still $1100 more per month and now that 2,000 less miles per month. Or 24000 less miles a year. More money and essentially two months less working time.