How much profit do companies make per truck?

The answers can very greatly... If you lease to a mega carrier on base mileage rate plus FSC then you really will only make enough to pay a driver and no other ROI.... If you lease to a smaller company that pays a decent percentage 85% and higher then you will do okay as long as the dispatchers are good at negotiating freight rates.... The other option is to higher an experienced driver that is a former owner operator and lease to a company that you or the driver can call customers and negotiate your own rates... Profit varies greatly depending on the truck and the level of negotiating skill and contacts you have... A cheap truck will cost you big in repairs.. A solid truck more expensive truck will have higher ROI....

 

An experienced driver with a lot of knowledge will cost you .40cpm minimum... .45cpm will lock in better drivers.. It is better to lock in solid drivers.. Driver turn over cost a company on average $3,000 every time it happens... Being a smaller company it is key to offer flexibility that drivers cant have at mega carriers... Also better equipment.. This being Pete and KW... Freightliners are cheap and rattle a lot... Not many drivers with experience will tolerate rattle traps after they put their time in them... Fuel cost is around .65cpm... Maintenance is about .10cpm... Insurance, Reg and fuel taxes can be a rough estimate of .05cpm... Then you still have to pay your normal income taxes, cost of the truck and what ever you would like to make profit as an owner... If you lease to someone that requires trailer rental, that is usually $150 a week plus repairs... It is cheaper to buy a trailer.. Rough trailer expense is .15cpm..

 

Fuel $4.00 gallon / 6 MPG
Note finance $100,000 @ 9%/4 years
Driver .50/mile
Benefits??
tires $500 each/200,000 miles?
insurance, tags, taxes???
truck/trailer washes, washouts
reefer trailer?? huge investment and maintenance costs.
lumper charges of $200-$300
tolls???? (have you paid the tolls into the northeast lately out of pocket?)
maintenance budget?????
bad debt write-offs???
accountant?
freight rates $1.30 mile?... $3.00 mile? freight slows, rates drop, bad market, good market
You can do the math as good as we can and the answer is ... in a perfect world, you can do great, but if things don't all come together 1 month or a succession of several bad months ... you can lose a lot of money, real fast

 

Running a cheaper truck, doing some work our self. Buying well and not over spending.... After ALL cost .... 5-7 per week, in the last 4 mths. But at that the office staff is free, as I am invested in the truck. The truck is currently leased on hauling HM, which is what helps makes the $$$. But that will go away when temps drop this fall.

Is buying a truck or two a good investment??? Yes and No. You really need to have a clue about trucks and trucking. Not everything can be learned on the internet. And you have to know how to operate a biz, which I think you do.

We are lucky in that I am the biz guy. I have owned and sold businesses as well as attended law school, many years ago. I can handle the books and hopefully all the files we are required to keep up with. My GF lives w/me and is a huge help as far as helping to track stuff and dealing with IRP issues. I know NOTHING about trucks, tho I grew up around them. Heck I am legally blind and can't even drive a car. BUT..... My partner is a 20 year O/O OTR driver. He knows truck, how to do basic repairs and has knowledge of such. But proper business operations are not his forte. So we make a good team.

Remember everyone lies. Some brag about how much they make and others whin about how little. Starting a trucking biz is just like anything else, you will get back what you put in it. Some guys work and run hard, others are just lazy and don't even know it.

 

I started as a O/O and later built up a small fleet and came off driving.
The biggest thing is to get enough of the right work.
The other issues you cant get away from and have to deal with so this is really the deciding factor.
It is really easy to be busy but there is no point in just turning money if there is no margin.
There are 2 ways you can tackle this issue (1) Get good rates.(2)Have low input costs.
I have always been better at getting good rates but this requires differentiating what you have to offer as a service from the other guys.
If you are just the same then you will earn just the same.

However to answer your question I would say that on general freight you can expect to make about 1/3 of what you pay the driver as profit.
This is based on what I experienced with owning 30 trucks.
I made about 10 times what I paid each driver.
Where you do end up making more is that you are acquiring an asset.
If the truck is freehold then after maintenance (assuming it is older) then on average about 1/2 of what you pay a driver.
You have to appreciate that when O/O say they make the same as being a company driver the company driver is not acquiring the truck as an asset.
Furthermore you cant expect a driver working for you to perform as well as an O/O with a real vested interested.

 

And a mega operates on an operating ratio of how many dollars do I spend to make how many dollars expressed in percentages......

Good mega's who know their game and play well have operating ratio's of 88%....best I've seen.....but then there are folks like USA who think they know everything and have the secret with a negative ratio of 100 plus %. I read a report about USA and it had them at 108% for a while.

You cannot spend $108 dollars to bring in $100 very long. Only thing that allowed him do that was the fact he's a public co. so he can add / sell shares to raise cash.

My number as an O/O is much lower because I don't have the overhead of a mega like land, mty iron, pvt. jets and worthless middle managers.

That help?

 

That is a question with alot of variables,

*Are you getting your own authority or leasing to another company
*what type of freight? ( dry, flatbed, refrigerated, oversize, specialized )
*Do you have the capital to properly start out without barrowing everything and paying intrest on everything and staping yourself with large payments right away
*Do you have any trucking background or knowledge of what you are getting into
*will you be offering health ins.


and the list goes on, The more info you provide the better the answer you will recieve.


Another very important thing to remember that owning a trucking company is very involved, It will not run itself and if you do not have any trucking experiance or knowledge it will definently be a steep and costly learning curve.

 

let's put it this way. there are a LOT of companies that no longer exist. that's how tough things are.

my very first company i ever OTR'd for.lasted 5 years after i left. and the economy was flying at that time. last i heard the boss was dispatching for england. he had a couple of customers hauling there freight specifically to there various terminals. which were mostly at the airports. he hauled 48 states. but those 2 companies closed up and the boss went outta business. he had 10 trucks.

don't know how long the internet boards have been around. but i don't think they were around at that time. since he couldn't find the freight to keep his trucks running. and the straw that broke his back. were 3 engine overhauls.

 

Well think about this way, a normal business would have a avg. profit of 10-15 %, Trucking companies back in the 90's had an avg. of 1.5%, don't know what it would be today but I do not believe it would be that much better, That's why you need a lot of trucks to get a better bottom line along with a good business sense.......