I am looking for input from owner operators...this is not a sales pitch: I need input. We have gone to great length to assist our operators with their business - they need to succeed in order for us to exist. Recently, I had an owner(4 units under our lease) walk in to my office and explain that he needed more money per mile; seems like a fair request. However, as we broke down his master lease agreement(which is NO DIFFERENT than any of our other operators)...the real problem started to surface: HIS POOR FINANCIAL MANAGEMENT! Did I mention the $65k custom bike that he rode up on?
After all was said and done...he left with out making any decisions. As I tossed and turned last night...I knew that I needed to reach out for real owner operator communication.
Here's where I need input: we offer 2300-2400 mile weeks, almost all 1-1 runs(2 nights home and all weekends), total pay package $1.65/mile - all miles paid, in addition after 90 days we pay 50% individual healthcare policy premium and match up to 50% annual deductible. We pay for all extras too!(ie, detention, diversion, extra stop...) The only escrow is $5k maintenance - no holds: you leave balance is on last settlement. Are we completely underpaying our operators? We have added operators consistently, and haven't lost many...so I like to think that we are in line.
I will not give our name...just want unbiased input, thank you.
Looking for input...real pay package
Discussion in 'Ask An Owner Operator' started by sawgs624, Sep 4, 2014.
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If your pay package is comparable to other outfits then what does this guy with 4 trucks stand to gain by taking his trucks to another outfit? How he spends his money is his problem.
281ric Thanks this. -
Sounds like an advertisement. $1.65 is ok for drivers that can't run a business. Better than what most companies pay contractors. Still cheap labor. Not profitable. I don't care how many miles they rack up or what you may or may not be paying for. Big part of what's wrong with the industry.
barnmonkey, windsmith and SL3406 Thank this. -
I appreciate the input...helps us build a more solid program.
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if you say it,put your name on it..
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If you are including the fuel surcharge in pay package, then they are making about $1.20 per mile on the runs.
They are paying for the fuel which is pretty costly in some areas. I also think routing has a lot to do with fuel costs. Interstates with limited stopping and slowing vs what I call cow trails with stop lights every block which in my opinion eat up a lot of fuel.
How much is being deducted at one time for the escrow amount?
Then there are tolls in some areas.
The only way to make more money is to give up the weekends and put in more miles running recap. This also means the loads need to be scheduled tight sometimes, no slough off time. Runs of 400 - 500 miles per day so that the driving hours are kept down.
You are also helping on med insurance, something a lot of companies have done away with when it comes to O/O or L/O.
Either they have to have a cheaper lifestyle or more miles which means giving up some of the time off, perhaps the home 2 nights.
Time for him to make a decision as to what he wants to do also if you are able to increase the miles driven. -
What about your fuel program? What kind of discounts do the OO get? Shop program? How often do you settle them? Is that $1.65 including any fuel surcharge? What kind of freight? How much weight? Do you provide trailers? Trailer rental fee? At $1.65 per mile the profit isn't great.
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1.65 isnt bad gross revenue. it not great, but not bad. 5k for maintenance escro seems steep. If they are O/O why do they pay you for maintenance? Are they pulling your trailers? Most companies charge between 500 and 2000 for trailer escrow. Im not charged anything for maintenance since as an o/o maintenance is my problem, not the companies. I would not sign on to a company that charges 5k for mainatance.
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What it really comes down to is...what is the driver worth to you? Could you replace him or is he worth extra to keep. Maybe its as simple as signing him up for a book keeping service like atbs or one of the others to hlep him manage his business better. Even if you paidd for it, that would probaly be cheaper then giving him more money and might help him be more satisfied working for you.
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Thank you for the responses...I will review the maintenance escrow, essentially done to assist o/o's in unexpected break-down situations: I agree it is up to them to manage their "business". This was put in place to offset me becoming the banker side of the industry - when an o/o is broke down and broke...I will look hard at it. Yes, to trailer programs...$1500 escrow; built up weekly at .08-.12/mile (maint was being built at .10-.12/mi). Settlements weekly, direct deposit. Average weight last quarter - 36.5k...general commods, all most all 1 pick/ 1 del.
Fuel discount program is an area that we need to work on. Also, I do have a shop that provides great general maint, tires and brakes at a discounted rate.windsmith Thanks this.
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