Determining Common Carrier Rate fuel hauler

Hi I'm almost embarassed to ask this but I have no idea how to set our rates to be profitable. My husband has hauled fuel for a while in the Midland TX area and has decided to buy a truck and operate under his own authority. It is my understanding that a leased owner operator makes twice the pay of a company driver and an independant common carrier with own authority could make twice that of an o/o. We have inquired direct with clients who he ran fuel for as a company driver and they are all eager to get started as their is a shortage of drivers here but they say send me your rates and we have no real idea how to set them. I have looked at rates other people mention but they seem real low for what other command here in the permain basin. We don't want to price ourselves out of jobs and we don't want to price ourselves out of making a living. What info can you give us being a carrier who doesn't have to buy the fuel at rack. would you be willing to share your rate sheet?

 

That is the question. Oil field rates change on a monthly, and sometimes weekly basis. If you are leased on you will be at the mercy of this changing system. If you are completely independent, you will have to adjust your rates accordingly, or you will not be used. All of the oil filed companies have multiple ways of hauling their product. As you are a very small fish in a very large pond, starting out you will have to take what ever rate the company is offering. As a starting point, we were billing out our crude oil hauling at $ 140.00/ hour. Billing 20 hours+ per 24 hour period (we were running 100+ trucks each day). As a second point, you need at least 10 trucks pulling from refined racks to negotiate discounts off of the rack rate. When I was doing pricing for a major supplier, we would not give any discounts until the volume was sufficient. Good luck.

 

We don't buy fuel at the rack we just access it from the customers acct so no cost for the fuel we deliver. I would be okay with accepting the rate the company is offering but of the couple clients we have relationship with they ask us for our rate sheet and haven't offered any rate.

 

If it was me and I wanted to get started, I would let them know this and ask them what they would be willing to pay. Make sure the contract does not obligate you beyond 30 days at a time. Out of the oil field you need to generate at least 75-80/ hour for refined, for all hours worked (that means from pre-trip in the yard to post-trip in the yard). If you are delivering in the oil field, you need to generate at least 100-105/ hour minimum, for all hours worked. They will pay you by the gallon/bbl/or percentage of what they get, but in the end, we all work by the hour.

 

Better get a insurance quote first, Bulk Liquid Haz Mat Ins is expensive

 

what do you mean buy the rates seem low? have you all even priced what it cost to lease a tank or buy. i know some owner ops in OK that on a 170 mile one way run make around 600$ but they are leased and get payed %. what kind of fuel hauling do you all plan on doing (rigs, compressors, frac jobs, gas-truck stops) its a cut throat busn. for a one truck person unless you are leased on to a company.

 

by seem low I mean that rates people have posted on the site that they receive are less than what a company driver makes hauling hazmat here in my area where oilfield is king. I'm sure the common carriers operating under their own authority must gross more as they can afford to pay company driver $23-$27/ per hour plus benefits for doing the work he currently does. He generally drives an average of 400 miles per day delivering 2-3 loads of fuel. @315wheelbase it is mostly gas-truck stops

 

Start with what is costs to put that truck on the road, first estimate your mileage for the year by past work and break the annual (estimated) costs from that mileage. Your insurance will be the most, then your maintenance, fuel for that mileage using worst case mileage, then other insurance needs, and then driver's wages (gross).

 

Indeed...definitely price liability over 5m and hazmat. Hope you have a track record too or the quote is gonna hurt.

JMO

 

@chalupa do you mean track record as a contract carrier? If that's what you mean we don't as this will be our first time establishing a trucking company or receiving insurance. As en employee he has handled hazmat for years but even as I am typing my reply I know that's not what you mean oh well......guess we gotta get ready to bite the bullet