I'm REALLY Confused About Something

Started in May as an O/O and doing pretty good, I guess I had a luck with 07 Volvo that I bought from Baskin, yes Baskin, no major repairs, all in all some 6500-7000 $ in maintenance for the past 6 months. I do not drive over 64mph, which it seems helps out!
I do not take loads if less then 2$/mile, I do PA to Mass to PA to Mass then go home (IL), rest for a couple of days, and hit it again. It works ok for me, I do not have any debt, but truck and trailer payments!

 

One thing you're forgetting is hiring good drivers. They don't just fall from heaven into your trucks. Most of the sad sacks you'll be limited to will end up costing you money if they don't steal and bankrupt you. The good ones have jobs with benefits. $25k is an ok cushion for one truck, sometimes I have as much as $40k in receivables out there with one but I don't factor. That was on the high end average is about $20k

 

Who do you find paying $2 a mile out of the NE? What are you pulling?

 

So you will only be providing bobtail insurance and insurance on any owned trailers? And running under his authority? If the answer to both of these questions is yes, then you need not worry about factoring, as he is required by law to pay you within 15 days (if I remember correctly) upon receiving a signed bill of lading. 15% could be a good deal, but like any percentage based leased it all depends on what the freight is booked for as to wether it is good or not. You need to ask him what the freight he is booking is on the low side, the high side, and what the overall average is.

 

...so he's got 2 trucks that he runs, plus he takes 15% from 3 others that he dispatches...and he grosses $900,000/year. How much fuel did his 2 trucks burn? How much did he spend on maintenance & repairs for those 2 trucks? How much did he pay in driver wages for those 2 trucks? Insurance? Truck notes? It all comes out of that gross dollar figure you quoted. How much does he have left over after he's paid all of the expenses?

Now subtract the amount he's receiving from those three O/O's.....that 15% dispatching fee...because that money won't be available to you. How much is left over? Is it enough to cover the 15% you'll be paying him to dispatch your 2 trucks? How much...if anything....would you have left?

That's what you need to figure out. Gross numbers don't mean a #### thing...you've got to figure out how much you'll have left after all of your bills are paid....the NET.