Can anyone explain how to operate at 1.75 a mile and stay in business!?

Mistake #1, you've been in the industry less than 6 months, and don't have the ability to pass the basic licensure test (ie backing up) which tells me you were in a more specialized area of the industry. You did not have the skills to start this business.

Mistake #2, poor capitalization.

If you knew you had to have the truck before being able to apply for the authority, and you knew (or should have known) that it would take several weeks before that authority would be granted, why not buy the truck BEFORE you quit your day job? That way you have some positive cash flow as you are waiting.

Also - if the financing fell thru why proceed with the deal? Sometimes it's good to go for it on 4th down, but not when you're deep in your own territory and have a long way to go to the first down. 20,000 in personal debt can be a huge burden when starting this kind of endeavor.

See mistake #1, not knowing enough about the industry.

See mistake #2, poor capitalization

You needed the space on those cards to cover expenses as your cash flow ramped up and you built relationships. Rates tend to take a dump in July and build thru the first of the year, then are cap until March. (Side note this is a gross generalization and over simplification ). My company encourages us to take our vacations in July, August, and January for this reason.

Mistake #3 - own your issues.

The shipper got you loaded late, but did you repeatedly contact the broker until the delivery was reset? Did you have detention listed in the freight contract?

You talked with a broker about a load, came to an understanding on rates, then said "I need to rent a trailer, I'll get back to you". Another driver said "I'm ready right now" and y poo u think the broker is acting shady?

Just because you can go fast doesn't mean you should. Especially if you're only getting 4,3 mpg. If the extra speed (read fuel) doesn't result in extra revenue, back off the accelerator and save some fuel.

Not trying to be mean, but if I were you I'd get signed on to Mercer, Landstar, Dart, etc so you can get under their insurance and use their contacts/freight contracts to start generating revenue as you figure this business out. Or just cut your losses, sell the truck for what you can get and get a company job and start paying off your debt.

 

You could cancel that $30K insurance policy.....for a start

 

I didn't say lease on with Swift or Transam. The companies I listed you chose your freight - based on what meets your needs. Most of the successful IC at Schneider sit north of 1.60 a mile - with no trailer costs. By running under someone else's authority you can get cheaper insurance, access to equipment, access to consistent freight.

So you can go someplace that guys can sit easily between $4-5000 in gross revenue while lowering your costs or you can keep doing what you're doing and lose everything in short order.

 

If you can't make more than $0.90-$1.10 a mile at Mercer or Landstar then you should go back to a company truck until you're ready to be an o/o. Just because you have your own authority doesn't mean you're prepared to actually run under it.

Suspending your authority & leasing on with a good company that pays % not mileage would be a good way to generate revenue & learn the business.

 

My first year last year (10 months) was $1.73 all miles minus %10 for the carrier so $1.55 all miles. Plus $190 week for insurance. My original budget was for minimum of $1.37.

I made it through. I did create some short term CC debt that is paid off already. I did fine and cleared over $50k. Not the best but I spent a ton on truck and trailer repairs.

$1.75 is not great but I could make a living at it and still take 4 or 5 weeks a year off and be home every weekend. BUT not with $30k a year for insurance and/or letting a dealer work on my equipment. That would kill it.

 

You may be confusing being a LEASE OPERATOR (L/O) versus LEASING ONTO.

L/O = leasing a tractor, from the some company, that you make weekly lease rental fee to, and they feed you loads (or starve you, if you dont act right)

LEASING ONTO = bring your own tractor, get loaded, if you get starved out, you keep on stepping.

Having your own authority at this time means nothing. You can barely afford to eat, leave alone fuel the truck or make insurance payments.

 

Actually if you take your truck to swift they still pay you $0.90 a mile. The compensation program companies have has nothing to do with where you get the truck.

 

Are you effin' serious????

Who in their right mind would do this?, esp if you own your truck outright? and are not "ball&chained" by their l/o program?

I'm shocked, to say the least