Ready to jump in, Looking for advise

Look for companies that don't care what it costs to get it there on time!

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Thanks so much as a newb i really feel lucky getting to discuss these issues with the experience here on the blog I hope one day to pay it forward

 

Guys thanks again for recommending ITS there's lots of opportunity there and plenty in my area.
So now another question arises is what should I seek rate wise? Do you guys have a standard that you maintain?
Thanks

 

Thats a very tricky subject, especially as a Hot-Shot.
The best answer I can think of is always as much as you can get but never below the following;
Figure out what it costs you to run, now double that number, that's your rock bottom yard to yard or to next load.
There are folks that will argue that if you have to deadhead it's better to take a load for fuel money but I will not.
If someone wants a load picked up or delivered in a dead area they pay there and back or at least to good paying loads, and they will!
It takes a while to really get the feel of what pays and when your better leaving the truck parked and spending time looking for a good paying load than taking the crap. Actually there's no crap loads out there, only crap shippers and brokers (mostly brokers) who have time to leave some of their loads on the loadboards at a worse than cheap price for a week or two hoping the trucker that works for fuel money passes by and takes it. This is exactly why I am against this theory, and that's exactly why brokers even exist, unfortunately a lot of truck drivers only know how to run a truck, running a business takes a little more savvy. Remember the broker is getting what the load is actually paying, what he gouges out of you is your loss!
Being a hotshot you will be more lightly to get expedited loads which we charge $5 PM after 250 miles. Local is usually set to day rate or a price your very well covered for. We pick up at the Bay Area airports, typically $400 per crate SFO into the city. Even if we only pick up one crate it usually takes 1 to 3 hours but when we pick up three, four or five crates at the same time, well now your making money.
If you travel far with a hotshot your not going to realisticly get an expedited load at the other end, so your options are LTL's to get back to your customer base your building that pay for your premier services.
It might be easier to get steady work in your neck of the woods but usually anything steady for a hotshot doesn't pay well and pretty soon even though your making a living your truck is wore out and your wondering where your going to get the money to replace it. There are threads here all about that, I'll see if I can find a link for one.
If you look at most lease operators they typically get paid every week, they usually run for wages and if they didn't get paid for a month they would go broke. You can not run a truck or business on fumes but if you do you will be very popular with brokers and have more work than you can handle till you can't put fuel in the truck anymore.
A good rule of thumb for an owner operator is if you can run for 6 months before you get money rolling in then you have enough to start a trucking business. If you have enough work and money to run another truck for a year before getting paid you are ready to buy a second truck and put a driver on it.

 

Here's the scoop on running a hotshot as an LTL service. Explanation starts near the bottom of the page the link brings you to.

http://www.thetruckersreport.com/tr...um/198900-beware-of-m-and-h-logistics-15.html

 

Our standard has always been the same here, get as much as possible for the load, within reason. Let me be the first to tell you, a Shipper offering a load, or a Broker with a load is rarely going to pay you round trip, or for the 20 to 50 miles deadhead from the truck stop, or your house whichever your sitting at to where the load picks up. And if you go around asking for that on every load your gonna be sitting around a lot. There's no money is sitting around.

There are occasions where a Broker/Shipper will call you and say whats it going to take to move a load. If they're desperate to move something and you flat stick it to them, don't expect to get any other freight out of them after this run. Brokers and Shippers have a long, long memory and it's doubtful they'll want to work with you again after you've stuck it to them. Treat them fair and they'll call you over and over again.

Most Brokers will tell you the rate, some Shippers may ask but they already have a rate in mind. Blurt a stupid figure out and they're not likely to call you back. A basic freight rating formula for you will consist of these things. Operating cost per mile, Driver paycheck, a modest company profit, and deadhead miles from the delivery point to where you can get a reload on, that's only if there's some serious distance involved.

Lets talk about that last part. This is where most guys blow it and get hung up on by Shippers. You should have a seperate figure for deadheading. If you ask for a premium rate per mile on both, your loaded and deadhead miles your gonna hear no thanks a lot.

Where a lot of newbies have trouble is, they simply don't know what lanes work. Another problem for most is Hot freight lanes can shift sometimes several times throughout the year. Lets say your running steady for weeks, or even months in a certain lane. Overnight this lane can dry up and if you don't realize it's happened, or which direction is going to pay off you could be in for some serious hard times. Those of us with experience know the patterns, and how to react when they shift. If you don't and you sit around telling everyone $2.50 a mile, or double your op cost is your rate you better have some serious money in the bank to carry you through until it shifts back to that area.

Keep in mind that you have to put at least two loads together to get any kind of a average. Lets say you take a load from Los Angeles to Denver for $2.40 a mile. You could sit there forever trying to get $2.40 a mile heading back out of there. Me, I'll grab a $1.40 per mile load if thats whats available and head back for Los Angeles where I can grab another $2.40 per mile load heading back to Denver, or somewhere else.

Lets look at the average on that round trip from LA to Denver and back. $2400.00 going, $1400.00 coming back. The run consists of approx 2000 miles. That means my average rate per mile on this round trip was $1.90 per mile. Run a 100,000 miles a year at $1.90 per mile and your grossing $190,000.00 a year. IMO thats very respectable.

Whats your op cost running a hotshot? If your set up similar to us, you should be somewhere around $0.70 to $0.80 cpm (cents per mile). Lets say it's .80 cpm. $190,000.00 gross for the year minus $80,000.00 in operating cost for the year equals $110,000.00 net.

This is just to give you an idea how we think, and how we operate here. Everyone thinks and operates a little different and there's nothing wrong with it if it's working out.

 

Who am I? I'm the owner of M&H Logistics, and Gary's Fleet Service.

 

That is some good info...... and I have been watching the board for the last few days the learning curve(which will be developing for me) is lining consecutive loads from start to return. I will be factoring the same costs as you both have described and applying them. I am so excited for the amount of freight that just seems to be available and I have been receiving calls already requesting my services.
Now for freight droped in a remote location were there is no possiblity of backhaul I am thinking $3 PM thats 2 loaded and 1 deadheading. Does this sound correct? or would you be asking for more or less?

 

The question is, will the type of freight support $3.00 per mile? 9 times out of 10 probably not. Give me some more details on the load like, origin, destination, product, is it for a shipper, or a broker? With that info I can probably tell you if $3.00 a mile is something they might go for.

If it's not a local run, why deadhead back? Isn't there a town/city a shorter distance then running all the way back home? The reason I say this is, lets say there's a city not far from where you deliver that you could find a load taking you back home. If you quote that extra $1.00 per mile on the total distance you could lose out on the entire deal when you may of been able to make even more money on the trip by quoting less deadhead miles and picking up a load going back . Most Brokers/Shippers aren't gonna be excited about covering excessive deadhead miles. A lot of Brokers/Shippers are gonna look at it like, this isn't right. Why should I have to pay you to travel all the way back home just because you MIGHT not be able to find another load? Most Truckers think Brokers are the Devil. Don't fall in to that mindset they're businessmen just like you. As a one horse Owner Operator you being able to develop working relationships with Brokers is going to be critical to your success.

Some on here might say, Yeah they should pay it, or they should find someone else to haul it. And thats exactly what will happen. Another Owner Operator, or company with more experience, and more connections will step right in and offer a more competitive bid and take that load.

The point I'm trying to get across to you is, you have to look at it from everybody thats involved point of view. Buyer, Shipper, and Broker if there is one, and of course yours. When I'm bidding on freight this is exactly what I do and it helps me to nail down a rate that'll work for everyone involved.

 

Lining up consecutive loads is going to be a big challenge for you. For instance if you wait to take a load out until you have a pre arranged return load you could be waiting a long time. It's nice when it happens but after 30 years of doing this I can tell you it takes a lot of time to develop the connections to make it happen.

While your learning the load board keep in mind that what you see today has probably been booked already, or the broker/shipper that has it won't want to hold it until you get there.