Percentage Pay v.s. Per Mie Pay....

First, at the $1 it should be + FSC.

And while I am big on percentage vs mileage pay there are times when mileage will work better. But more than mileage vs. percentage is the O/O acting like a business person and understanding what they are doing. I have talk to many percentage drivers working with a "great" company that are making less than what CRE is advertising.

It is about understanding the numbers and what works for you.

 

Percentage pay is typically better than mileage, but you need to know what the rates are you will be hauling for to determine that. Let' just say fuel surcharge is equal between the two, on the mileage pay you are getting $1.00 per mile loaded only plus fsc, on the percentage you are getting 75% of the load plus fsc. Now the thing is on the percentage the rate is only $1.34 per mile, which is better? Neither, they are both the same in the end. So it is important on a percentage deal to know what the rates are. If a company will not tell you that then they are not someone I would be willing do business with.

 

% over millage is the best way IMO because companies play it safe with millage. The pay sucks sometimes with percentage and all the time with straight millage. Again this is my opinion based on personal experience as an owner operator. It's different in the ltl world.

 

Another thing to think about is if you are doing percentage, the company may take the highest dollar load but it may not be the highest dollar PER MILE load for you. Why take a load for $5,000 a distance of 3,000 miles when you could pick one up for $4,500 for 2,500 miles?

 

That's the thing with % pay. If it's not enough $$$ you can tell then to give it to Swift brokerage or one of those other guys that will give it to one of their millage paid drivers.

 

Well, let's see regarding the "I don't know how anyone can make it on a $1 a mile" idea.......

2012. 223 full days out, 43 partial days. Gross $184K. Net after all expenses (including health ins, personal vehicle cost, and associated cost when bought new truck in August) $72K. And that was on 136,128 total odometer miles. My net would have been larger had I not had to replace turbo and cam on my last truck early in the year along with adding some goodies to my new 2013 glider truck like ported/coated exhaust manifold, non waste gate turbo, and grill guard. And I got home each weekend/holiday and by the house once or twice a week, and got in the hunting seasons. No.. not on a dedicated run and even using e-logs.

What seem to elude most people's thinking with that $1 a mile thing, is that you have to look at the entire package. For instance, I get $100 for an extra stop off, I get substantial discounts on fuel (got .37 a gallon off the pump cash price on last fueling) and a pretty decent fuel surcharge on top of that (right now .46 a mile), I have no trailer expense or charges, base plate costs are reimbursed to me by carrier, I get roughly $38 an hour for detention (have gotten as high as $50 an hour) and I don't have to fight for it, the only company fee I am hit for is $10 a week for the qualcomm (no deposit or installation charge), my OCCACC is $136 a month, my bobtail is $7 a month and Phys Damage is $2.36 per thousand value of truck. I have my own BCBS health ins for $433.35 a month. Carrier pays the IFTA... not only files it, but pays any needed amount.

So much for that "you can't make any money running for a dollar a mile". Might have done better on a percentage thing, but all the variables have to be figured in. Right now, I'll stick with what I have. Oh, and this with Fremont Contract Carriers.

 

Cowpie is a great example of how you have to look at everything. The sun, moon and starts have aligned for him so that he can run an insane level of miles and still have some resemblance of a life. He was in a position that the huge risk of spending the money on a non-CARB compliant truck living west of the Mississippi wasn't that big a risk for him.

But to point at him and say it will work for you is as bad a decision as pointing to the money Rollin is making and saying what he is doing will work for you.

More, I cleared over $1,500 per week in a lease at CRE years ago. Do I recommend these programs for people? No.

You have to have a plan, figure out what people like Cowpie, Rollin and others are doing and ask if that will fit in your plan. You need to be honest with yourself about some of the little things that can make a big difference. Like the flatbedder going to a new company that talked with a ton of drivers on what they really make. But never mentioned that he refused to tarp in a company that is over 50% tarp loads.

The saying "The Devil is in the Details" is never more true than it is in trucking. People banking on detention and stop pay to make something work. Or cutting DH down to make something work. Think, plan, question and leave as little to chance as possible. That is how you will determine if mileage or percentage is better for you.

Now still doesn't change my overall opinion that if you can find a good percentage plan that fits you should be able to do better. And I say this because I have never seen a mileage person (talking dry van) tell me he is making better than $2/mile TTT.

 

$1.35/mile TTT - They better pay for everything.

And I want you to be honest here.

If some driver wanting to become an O/O came to you and was asking for advice on putting a business plan together. Would you suggest to him that he use the $.80/mile all in as a good number for budgeting? Or averaging 500+ miles a day? Or being home over 3-months?

And this is a good example of how some can make one of the lowest mileage pay plans in the industry work because it fits you like a glove. Problem is most people going into this don't know their glove size or what size glove they are getting.