O/O Advice Needed

Gokiddo has explained it very well. If you have an idea on how to run your back office than you will have an idea on how much profit you'll make. I highly doubt it will be more than $2,500 per truck/trailer depending on driver.

I have my start up planned but yet again I have 7 years in trucking, 6 as a driver and 1 as a dispatcher. What I could tell you is start from the cheapest possible...

I would rather advertise a bit and spend couple thousand doing that than to go and buy a used truck/trailer. See what you can gurantee have there once you buy the equipment.

 

I don’t think it’s a worthwhile endeavour with one truck. I speak from experience owning 3 right now and maintaining them for the drivers. We make decent pay hauling with them at the moment. It’s a full time job and if your not able
To fix your own then I don’t know how you would survive. Trucks break no matter what they are. My drivers get paid every 2 weeks. I haven’t been paid for anything after mid October. Can you float 100 plus k in fuel and other money? I don’t know how the dry van market is down there but I know there’s lots of immigrants running the rates down here.

 

Yeah I'd be pretty worried if you haven't been generating enough cash to pay yourself on 3 trucks since mid October. The market isn't going to get any better realistically.

What happened that caused you to have so many problems? What kind of revenue per week per truck are you generating?

 

Nothing bad has happened. It’s just the way they pay. It’s been like this for the couple years. We do some Powerline work in the winter. Trucks might not move much usually just one moving over the summer steady. Weekly revenue is a hard thing for me to state as our work can be so much you can’t handle it to nothing. 1 truck has been billed out at $4500 per 5 day week 2 loads a day 60 mile one way trips. Driver gets paid flat rate of $1250 for those loads plus wcb, vacation pay and that jazz. Doesn’t leave much for me after fuel and wear and tear. But that’s necessary as it’s part of the work. It keeps a guy employeed and we are satisfying the company. Kind of a trade off.

I didn’t mean I personally can’t make any money off the truck I mean the money I billed for my work is owed that far back.adds up fast. Not to mention repairs and two trucks got new rubber. You don’t come into the business to make big money overnight.

 

You are paying way too much for a local driver in a lot of markets. Also I'm fairly certain that 450 a load for 60 mile loads that eat half a day is pretty meh. Both of those depend a lot on where you are, but I can all but guarantee that one of them is pretty wrong. If the driver makes the right money for the local market your freight is way too cheap, and if the freight is the right price you're paying way too much. It's really either/or/both but it's never neither.

When you are running a business you do not do things to 'keep people employed'. Every truck on the road represents real risk to the company from breakdowns, accidents, claims, or just losing the driver and sitting there slowly eating your operating capital. This means that the company needs to generate a reasonable profit on the truck. You aren't a charity and behaving like one will eventually lead to your doors closing. Your job is to maximize revenue and minimize cost over the long term. This means that frequently you'll be doing something that doesn't do either in the short term, and that's fine, but the long term on what you're doing now is 'some massive expense comes down the road, I have depleted my personal cash reserves, I go out of business'.

You'll be fine as long as you fix your revenue and/or cost issues though. This business is really good right now. Anyone operating at breakeven or worse right now has massive holes in their business model leaking money like the Deepwater Horizon leaked oil.

 

Dads doors have been open for over 40 years. While sometimes I think we need to charge more I appreciate his experience. There’s give and take in everything we do. We aren’t millionaires but I live comfortably. I take the loads that pay a bit less and we also get the better paying loads. I’m making money on those loads I mentioned but not the profit of other loads. Companies keep good employees going if they can. Everyone has a family and I won’t use someone when I need them and money is good and say no when ya not as much money. I won’t keep them when I don’t have the work but that’s understood. I make a bit less because I pay my drivers good. I’m ok with that. Sometimes that tips the scales on weather or not they are easy on my equipment or their attitude. These drivers also have to gonoffroad at times. Chain and strap open deck loads. A good driver is worth good money because he will save you it quick. I operate as smart as I can. As a for hire trucking company we can’t control loads. If all my trucks were parked today it wouldn’t hurt me one bit. I don’t owe a cent on any of my trucks, 8 axle lowbed, step deck, trains... etc.

 

Like I said also the same place provides the low pay loads with the better paying ones. Give and take. We have a good relationship with them and we try to keep that.

 

So you have a freight problem. That's completely fine. You need to start actively looking for better stuff to haul it sounds like. In fact I don't think you have a more important task that needs to be completed in the next 7 days than finding someone who is willing to get you to 1k+ per day on that local truck.

 

Getting paid 100-300 under the daily market rate is not a 'good relationship'. It's you paying money to avoid having to go out and find something better.

I'm sorry but 900/day is being taken advantage of unless you can hire drivers for 1k per week or less all in including all benefits and vacation time. There are definitely markets where that's a viable business model, but you're unwilling to go that way so you have to find better freight.

Thankfully right now is literally the best time to go looking you'll ever get. I'd be shocked if you don't make more money with that truck the first day booking random load board garbage.

EDIT: Obviously start things with the customer off by saying that unfortunately due to increased driver costs over the last 12 months you have to raise your rates. Bump it up to 600 a load. If they say yes you're golden. If they say no tell them that you're really sorry but you have to find other work because you haven't paid yourself since October.