Keeping track of O/O operating costs

Discussion in 'Ask An Owner Operator' started by cats5000, Jun 30, 2011.

  1. cats5000

    cats5000 Bobtail Member

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    Jun 30, 2011
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    how do you all keep up with operating cost and make money
     
  2. cats5000

    cats5000 Bobtail Member

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    Jun 30, 2011
    hudson, fl
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    how do i find the right way to do operating costs. there is so many software programs out there but I want real time stats and dont want to wait to find out what the trip cost me:biggrin_25512:
     
  3. Nootherids

    Nootherids Light Load Member

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    Hey Cats, you might want to be a little more specific about what you're asking? Operating costs as a whole refers to ALL of the expenses incurred in a business except for Real Estate, Equipment and Taxes. For small businesses without too many assets (equipment or real estate) it's easier to split them into Fixed and Variable Expenses. We could go into a whole class about explaining how finances work and what operating costs are in the trucking industry.

    There are too many ways to answer your question without us knowing a bit more about what knowledge you currently have and what specific knowledge you need us to share with you. How about some more background on you and what you're trying to do?
     
  4. G/MAN

    G/MAN Road Train Member

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    The easiest way to get your operating costs is to buy one of the trucking specific software packages. As soon as you plug in the expenses for the trip it gives you your profit or loss for the trip and for any period to date. For a single operator you can find them from about $125-200. Several have online demo's or trial versions you can check. www.trucknpro.com is one that I prefer for the smaller operator. www.easytrucking.com is another that I bought. And another that I am familiar is www.truckershelper.com. This one has several versions depending the size of your company.

    There are other programs on the market. Most of them do basically the same thing. As I said, I prefer trucknpro. It is simple and competitively priced. I have used it and Easy Trucking for several years. Any of these programs will give you your profit by the mile as well as gross profit. I think that trucknpro will also give you a breakdown by kilometers if you are in Canada. As quickly as you put the trip information into the program you have a breakdown.

    You can set up your own spreadsheet if you prefer. OOIDA has a couple of spreadsheets that you can download and play with numbers. I don't think you can do the actual books, but it might be helpful to set up your own spreadsheet. www.ooida.com.

    Having up to date accounting information is critical in this business.
     
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  5. Allow Me.

    Allow Me. Trucker Forum STAFF Staff Member

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    3 words....manage your $$$. Kinda like, manage your time. I always say drivers who have a family at home VS a single driver have a much harder time getting by.
     
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  6. terrylamar

    terrylamar Road Train Member

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    I don't see why, seems like you could make a lot more money by putting the family to work. Do they really expect to sit it out at home?
     
  7. Allow Me.

    Allow Me. Trucker Forum STAFF Staff Member

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    I was thinking about Wifey and 2 kids under 5, for instance. Kids need clothes etc, Wifey needs to be home. Or, she could pawn them off to day care.....which costs money.
     
  8. BigJohn54

    BigJohn54 Gone, but NEVER forgotten

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    That's a fact. If you spend $40 - $50 a week driving to work and child care for two kids, it's like a fleece/purchase. A negative statement at the end of the week. Not to mention the toll on the kids.

    Then the stress and constraints that the family can put on you. The family thing is like drivers. Some have no business in trucking.
     
  9. BigJohn54

    BigJohn54 Gone, but NEVER forgotten

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    I think you have to plan it out well before you start. You need to do your projections based on realistic information from research. Then you pad your expenses, figure revenue and miles low. If you can't make it with those numbers, you figure a way to get expenses down or increase revenue. I think that planning plays a big part.

    Then you make sure you have the capital to cover what will go wrong, no if or I hope.

    Then you need a way to manage things. I used to use a ledger, but will opt for a software package this time. You have to stay on top of things. When something isn't working, be aware, fix it or park it. This is the hard part to grasp.

    You can go broke sitting at home as easy as generating revenue for someone else. Sure you still have payments and insurance, but if you planned wisely they are probably 15% of gross (25 - 30% of truck costs). It's easy to be in a situation losing 15% of gross through decreased revenue or increased costs. If I planned with no profit and lose 0.30 CPM from my gross revenue that is where I would be. If I'm paying that out of my wages, I can get a job and do as well.

    So you have to be willing to make the tough decisions before bad turns to ugly. Having seen ugly firsthand this is not so tough for me. If you haven't weighted the risks financial and family, don't do it. If you don't have a plan as to what you are willing to lose, stay out of business of any kind. If you don't have an exit strategy to minimize damages, don't do it.

    I guess my post says it's all about planning. We all know the saying about best-laid plans, so it's no guarantee. I can guarantee lack of planning will only end one way. There's a lot more to it than driving, loading and running miles. If all you plan for is success, you missed a big part of the planning process. In aviation there's a saying, something like "anything you have a planned response for is not an emergency". While it's not entirely true, if you have a plan for the inevitable downfalls, a successful outcome is much more likely.
     
  10. Nootherids

    Nootherids Light Load Member

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    When it comes to planning and budgeting BigJohn is on point and knows what he's talking about.

    But the OP hasn't responded with a bit more information :biggrin_25512:
     
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