O/O Advice Needed

Maybe there is abundance of high paid where you live but there is not round here..... plenty of people lining up to steal our work for less. Including gardwine who was pulling trains for less than we were pulling straight trailer. The short haul loads and most load for this company are truck only so it’s their trailers getting the wear on them. So what price do you attach to your truck pulling 6 axle loaded mile for someone? With and without your trailer.

 

Maybe looking into a loadboard in the off season is a good idea. But at the moment my trucks are moving steady. I just fired a driver so my 3 rd truck now sits with no driver and too much work. The trucks have a load designated before they get back so they are moving pretty good. I’m not sure if a load board can keep them that busy. On top of the fact the loads originate in our base town. No travel. These also affect costs.

But when we slow down I will take your advice on searching for loads.

 

You're busy because the market is hot. When it slows down it will be because the market isn't hot anymore and it'll be a lousy time to find new customers. It's kind of the paradox of freight sales.

I'm not telling you to go get on a load board and expect magic to happen... But you definitely want to have the option of saying 'no' to your customers when they ask you to run something super cheap. And if they don't have any freight at all the wheels on the truck still have to go round and round. It's absolutely NOT OK to lose more than half a days productivity as a local trucking company.

At the end of the day it's not unreasonable to expect customers to either pay a solid rate consistently that is profitable year in and year out OR to pay the market rate. If they pay subsistence money you're actually getting the worst of both worlds. They can just tell you they are slow when the market is down and buy your trucks for below market rates when it's up. That's not fair to you.

 

So for a 133 km one way trip. Takes 30 mins to load reels and chain them. Head back drop trailer grab empty and do same. What would you charge? Per mile or per load?

 

Mileage pay is for longer lanes. Anything under a full days ride gets charged a daily rate based on the time it takes. The reality is that for the owner of the company the costs just don't change that much from 100-400 miles driven in a day. The primary cost for short haul operations is capital costs for the equipment (fixed usually) and driver pay which should be %, flat, or hourly.

Always make sure you are charging customers in a way that actually lines up with how your business creates costs. I don't care if they pay you 20 dollars a mile if it's a 5 mile run and it takes an hour on each end to load/unload. You'll starve.

A good example of this from a freight brokers point of view is that I always pay the truck the way I'm getting paid. If the customer is paying a flat rate that's what I'm paying the truck. If the customer pays by the CWT I'm going to pay the truck in CWT.

 

Then answer the question any way you would like. Your getting hired per load. The load takes 4 hours and just your truck is used. Its someone else trailer.

 

I am paid a flat rate for theee loads based on time spent. If they waste more time hen I allowed we charge extra per hour. Employee is paid flat rate for the load as well and for any hour I can charge the truck so the employee gets.

 

That really depends on what the market rate in your area is. The best way to figure that out is to call a bunch of local shippers and inquire about being a local trucking company for them... and what they pay.

Then go to your current customer and ask them to match the best offer you got. If it's close don't bother, but find new cheaper drivers... Because again, if you aren't making money now at the top of the market, you won't ever be making money again.

I'm assuming you've been working with this customer for years. When was the last time you raised their rates?