Yearly Profit After Expenses...

These numbers seem to be more or less in line with what I have. I already have the laptop printer and my phone will hook up as modem. So some of the initial startup costs are going to be taken care of because I already have some of the stuff. I am starting with 30k so pretty much twice the minimum and will be putting a fair amount back right off the start. Thanks for the info.

 

However to come on here and just say "you're going to fail don't bother you're just an idiot with no experience" is a waste of time. Ok well all the best , sorry that some of the GOOD advice that was given was not taken for what it was worth. Sad part is a lot with EXPERIENCE fail so I hope you make it.

 

I plan on starting with start up costs of around $270K cash so everything would be paid for. This includes a very large emergency fund, even for a new truck and trailer! You should seriously take these good old boys' advice! If you really want to succeed at least invest into more reliable equipment and try and get some experience first. I am waiting until I have a better business plan and can get drunk enough to blow that $270k. Because sober its a hard bullet to swallow!

Do you at least have a CDL? If so you should try and get with a company, if tickets are stoping you just plan and wait until they are gone as this will hurt your insurance.

 

270 k---if i had that much cash--a truck would be the last thing i would buy

 

Somebody ain't thinking straight if they have 270,000 American dollars and invest it in a truck.

 

If I am in a bad area I won't hang around very long. I will usually put it in the wind and head to a better area. Rather than take a load for $1/mile to cover fuel, I may deadhead 350 miles or more to a better area. At 5 mpg it will take 70 gallons of fuel to do the deadhead. If fuel is at $4/gallon, that means that it will cost approximately $280 for fuel. Actually, I should get better fuel mileage with nothing on the truck. It doesn't account for any wear and tear on my equipment, but I am not hauling to cover fuel costs. If I had taken the load for $1/mile then I would have made $70 over and above the cost of fuel. It isn't worth it. Most loads will pay a minimum of $500. Even at that rate, I would only make $220 after fuel. That doesn't account for insurance, driver, equipment payments, maintenance, etc., If the broker or shipper cannot move the load for $1/mile then they will raise the rate until a carrier takes it. If they have no takers then the rate can escalate significantly.

 

The trucker can only negotiate the rate. I've never been able to tell a broker or 3pl they have to pay me what I want...

If the shipper/broker/3pl sez it only pays X then that's what it pays... find another load. But the trucker does not control the rate.

Even the big guys have to take into account their competition when negotiating with their customers. If you are a buck a mile higher than the next guy, and he provides as good a service as you, you are out the door...

My son is always battling low ballers who come into his customers office and cutting his rate. His main account pays him $3.25/mile plus stop pay. landstar has gone in twice in the last three or so years and cut the rate to $2.50... but they could never get trucks to the dock. The customer is over 300 miles north of Milwaukee.

Recently the shipper found another cheap O/O to haul for him. This guy basically STOLE a truck from his parents trucking company and solicited the freight on his own... at 50% of the rate my son hauls for.

So my son, who get's $3.25 per mile, had to find other freight while this low baller took the business... until he, too, couldn't make deliveries on time, missed loading appointments.

My son couldn't control the rate... he could only control HIS rate.

 

It is the one who takes the load who controls the rate. I understand what you are saying. I think your example is typical of what happens with the cheap freight haulers. They may take some freight for a time, but they cannot afford to maintain the freight due to the low rate. If a shipper or broker wants service then they will need to pay a higher rate. I am glad that your son walked away rather than trying to compete on price. You will never win competing on price. If you get business only on price then you only have the account until someone comes in who is a penny a mile cheaper. It is a poor way to run a business. If I have an account who gives me the boot due to a cheap freight hauler then the price will go up when the shipper comes back when the cheap hauler cannot perform.

Whether the truck takes a load at a cheap or decent rate, they set the rate. Shippers and brokers can offer a load at a cheap rate, but until someone takes the load it is not set.

 

I have stayed home many times due to the rates. I am so arrogant, that many times, while I stopped getting loads from my dispatcher, due to the rate cutters, then when they low ballers could not, or would not take the loads anymore & they would call me & offer me a higher rate, I would just say no. not at any rate. I'm out for a few months & lose money & NOW you want to offer me the load, just cause the shipper cannot move it? let them have the loads sit on the dock. I know it may not be my dispatchers fault. I am a leased o/o. but I tell them, tell the shipper, I am not going to wait on the sidelines, hoping to get freight only as a last resort to them, if their low rate drivers cannot show up, then they call me? no way.I am not interested. i don't care if it pay's $5.00 a mile,now. if you cannot offer me a load first off & at a decent rate, do not call me later. I have been offered many times a great rate, but only after they would sit on a load for a couple day's trying to get it moved for cheap, would not let me have it for a decent rate.when they call back desperate. I tell them NO! now I don't want it, no matter the rate. it's just me, not trying to sound arrogant, but at times you have to be arrogant with these folks. to me $2.25 a mile is my min. if I am far from home & get a offer on a good rate after being offered a low rate I will take it. but if I am at the house. No. if you offer a cheap rate & then call back a day later with a better rate, sorry, not interested in helping you out.

 

I understand what you are saying but the name of the game for profitable carriers is to have the ability and stones to sit MT till you get your rate. Or DH to better rate area. At what point are you going to run out of customers near you home because they pissed you off at some point?
You may not like the game but if you understand it you can win. But it is hard to win when you are playing a different game than everyone else.