Authority

Read this, then ask specific questions and we'd all be glad to help.
http://www.thetruckersreport.com/tr...-operator/13608-so-you-want-own-your-own.html

 

I will mention a couple of things. Never extend credit to any broker or shipper without first checking their credit, broker authority and bond. If they have poor or questionable credit, either get your money up front or don't do business with them. You may also want to set up with a factor for your receivables, unless you have the funds to comfortably carry you until the money starts to roll in from customers. You can expect to start receiving payments from 30- 60 days from the time you submit your paperwork to them. I usually don't do business with any broker who has not been in business for at least 1 year. Once the load has been delivered, make sure to invoice immediately. The sooner you send your invoice, the quicker you will be paid. One other very important thing to remember is to ALWAYS read over every contract carefully. If you have questions or don't understand or agree with something that is in the contract, either get clarification, have it changed or don't sign the agreement. It is better to walk away than lose your shirt on a load. I always run the miles for a load before committing, too. Brokers and shippers can use different methods to calculate miles. There is a big difference between HHG and hub or practical miles. NEVER take a load if there is a question as to whether you can safely make the pickup and delivery on schedule. It takes years to build a good reputation, but a very short time to destroy. Don't be afraid to hold out for a better rate. There are too many out here who have no idea what it costs to run their business and earn a profit. Hauling too cheap will inhibit your ability to grow and take care of your equipment. Make sure you set up your books from the beginning and keep up with them. You need to know where you are at all times. You can use a spreadsheet, standard accounting programs or one of the trucking specific software programs. I can offer you a few options for trucking software, if you are interested.

 

Feel free to contact me anytime. I am glad to see that you are taking your time and doing your research. There are three trucking software programs that I am familiar; www.truckershelper.com, www.easytrucking.com, and www.trucknpro.com. All three have either an online demo or short trial where you can download the software and try it before making a decision. Out of the three, I think that Trucknpro is the easiest to use and has more versatility. They are always tweaking the program. You can use it regardless of the number of trucks you run and the cost is not that much compared to similar programs. You can track maintenance, brokers and customers with whom you do business. There are a number of reports that you can print. All three programs will give your cost per mile to operate on specific loads and your net per mile. I prefer Trucknpro due to it's simplicity. There are other programs on the market that can run into thousands of dollars, but you don't need them. I looked at about every program around before buying my first trucking software. I initially bought Easy Trucking. There customer service isn't great and there are some things that I don't like about the way you need to put information into the software. But, it will do the job. Truckers Helper is a good program. There are several versions, based upon the size and scope of your business. There is one version which has a driver qualifications file and will do payroll based upon type of compensation. It has the capability to calculate hourly, mileage or percentage. If you have drivers, payroll and driver qualifications file are good features. Some consider Truckers Helper a little cumbersome to use. Trucknpro is simple and gets the job done. You can print out a p & l at any time. If you put in your fuel and mileage, you can print out an IFTA report at the end of each quarter and you will have all your state mileage and fuel so that you can do your quarterly IFTA filings. It will also do invoicing and other features. When you put in your trip, it will give you your net profit immediately. It will also break it down by the mile, which I like. You know exactly what it cost to operate your truck on each trip.

There is nothing wrong with using a spreadsheet. It will give you the information you need. I also keep a spreadsheet for certain things. But, with trucking specific software, you save steps when you want to see how you are doing in any given time period. You can customize the software, to an extent. For instance, I separate tire purchases from my maintenance. If you want to see how much you are spending on certain items, such as pm's, tires, etc., you can do it. By separating specific expenses, I know what I am spending on each thing. It isn't necessary, but helps me in doing some planning and makes it easier to see where I am spending my money. At the end of the year, you can print out the reports you need or a p & l and give it to your accountant or tax preparer. One of my friends is leased to a carrier and has used Trucknpro for several years. It takes him about 30-45 minutes to do his books for the week. He usually does it on Saturday morning when he gets in from the road. I have another friend that has also used the software for a number of years. He runs his own authority.

Most trucking specifc software will do the same thing. Some are easier to use than others. I would check them out, or have your wife take a look and see if it works for you or if you want to continue using a spreadsheet.

 

You may want to start out with brokers. If you want direct shippers, you need to first familiarize yourself with rates for various freight lanes. Most who start out will often quote rates much less than they should. You must know your operating costs to break even. Unless you enjoy making sales calls and working with people, you may want to stick with brokers. You could use a dispatch service, but most will use brokers and load boards to keep you moving. Some carrier's have annual contracts with shippers with fixed rates. Those with annual contracts will usually have a base rate + fsc to offset the fluctuations of fuel. You also need to list the terms of the contract. For instance, you could offer 2% net 30. That means that if the invoice is paid within 10 days that they shipper can take 2% off the freight bill. You also need to have something in the contract that tells what will happen if the shipper fails to pay as agreed. You could add interest onto the invoice every 30 days until the invoice is paid in full. I would also make sure to include attorney fees, court costs, collection costs also included in the contract. If you are not familiar with contracts you may want to have a lawyer design one for you. Some shippers may also have their own contract. Sometimes, it is the consignee or a third party that pays for shipping costs. If you are not familiar with contracts, you may want to invest money having a lawyer familiar with transportation law, to design a contract for you. OOIDA may have a sample contract that you could adapt to you business, if you are a member.

Until you get your feet wet, you might be better off limiting yourself to working with brokers. They will have their own contracts that they send to you. I would advise you to read each contract over very carefully and don't sign anything has language that you don't agree. I always put something in their contract that covers me if they don't pay as agreed. Some don't like it, but it is business. Contracts should be fair to both parties.

 

Rates vary according to the time of year, region and other factors. Lately, I have seen rates from around $1.35 to a little over $2/mile. If you are looking for an average, I would say between $1.35-1.70/mile. There are some van loads that could pay $3/mile, but those are not the norm. Coming out of Texas, rates have been historically low. However, I have managed to find a few companies who are willing to pay a decent rate. If you want to spend the time and effort, you may find a shipper or two that may have regular shipments that have a decent rate. For the most part, short runs pay a higher rate than long miles.