Reality of my logic

Discussion in 'Ask An Owner Operator' started by Trucker indiana, Aug 5, 2019.

  1. Trucker indiana

    Trucker indiana Light Load Member

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    Hello all and thanks in advance for any help, advice, or even criticism.
    I am aset up to make the move to owner OP. I think? I have a year otr in, business experience, and a about 30k cash plus another 15k line of credit to start. I did the year solely to see if I like or better yet handle the trucker life.

    I have had a very basic pitcher in my head and on paper to what i need to start that is as follows
    Truck 15k
    Maintenance cushion 10k
    Initial exp 5k

    My expectation on exp. Are
    Fuel 60 cpm
    maint. 10cpm
    Toll and fees 5cpm
    Total ... 75cpm
    Fixed exp
    Inser truck 1000 per mo
    Family insurance 1000 per mo
    Personal income needs 1500 per month
    Total 3500 per mo. Or about 800 a week or 42k year
    Expected rev.
    $1.75 per mile to truck
    Running about 80k miles a year
    Minus rolling exp that is 80k a year minus fixes is 38k profit a year for a personal net profit of 56k before taxes and what not

    Some info. I flate bed, I set my average for running 2000 miles a week 40 weeks a year, I guessed lower on rev and higher on exp. Till I can confirm them.
    I do not go out west I stay east of the Mississippi 99% of the time and 75% of the time in the mid west il. Ind. Mich. Ohio. Ky. Tenn
    This truck is only intended to last a year
    I do plant o. Running more miles and I should come in a bit higher on my all mile rev. Average

    Ok sorry for the book there. Wanted to have my train of though laid out before my questions.

    1. are any of my guesses to high or low?
    2. I am not brand loyal so at 15k what kind of truck should I be looking at and should I take 5k of the maint cushion to get a slightly better truck up frount.

    Fyi I have been looking in the early 2000's. N14 and Detroit 12s. My main priority in a truck is reliability.
    3. Is there a solid old vs new argument for fuel economy
    Thanks again
     
    Truckermania and Concorde Thank this.
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  3. x1Heavy

    x1Heavy Road Train Member

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    You were on the right track with finding one number cost per mile you need to break even. You think that 3500-4000 in fixed costs to yourself works out to what?

    2500 miles x 4 weeks = 10000 miles loaded. You are bordering on .40 a mile.

    Under the line total of your first group adding up cost per mile of 0.75, add that 0.40 and you are now at 1.15

    Your fuel burn for 10000 miles will be around 6 miles per gallon. Allowing 3.00 per gallon you need... to buy 1700 gallons of fuel at $5100 for the month. That's about what? another .46 a mile?

    Edit forgot you are allowing .60 a mile fuel as foundation.

    Im afraid to dip any further into your costs.

    You are into 1099 land. Your single taxes for yourself is going to be stacked onto Fed, State, fuel taxes, social security, medicare and god only knows what else .

    There is also stickers and tags to legal that truck to run each year. Blend that into a fixed cost and then divide by 10,000 per month. You can assume that if you meet this number and exceed it the rest is gravy.

    You say 10K cushion for fix it stuff. You want 20K in one year from now. 30K in two 40K in 3 build up. In 4 years you can withstand and endure a total engine failure possibly.

    Who knows.

    Edit.

    Clean forgot the one thing in trucking I insisted on first frost about october. 10 virgin quality tires for winter battle. Older 10 set has plenty of miles, goes into your tire shed ready to go when you go through tires now and then. That's 5000 dollars plus sales tax once a year.

    420 dollars a month. about 0.042 something cents per mile.
     
    Last edited: Aug 5, 2019
  4. RoadRooster

    RoadRooster Road Train Member

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    Didn't see anything about taxes...maybe I read it too fast, maybe you didn't think of it yet. Good luck.
     
  5. nikmirbre

    nikmirbre Road Train Member

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    E9D6719E-7B1B-4A9C-8C11-F80D9FFC753C.jpeg
    Basic pitcher...

    Or any Detroit Tigers starter this year....
     
  6. Bakerman

    Bakerman Road Train Member

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    Just do it. You're not going to know if you can make it, until you make it. Just get out there.
     
  7. x1Heavy

    x1Heavy Road Train Member

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    I am familiar with Detriot 12's into the relatively then big 500 HP range, Ive had three trucks with that in my life time into 2001. All three showed consistent behavior that I grew to rely on. Ive had episodes on some loads where 2100 miles to empty or near 85 hours waiting precooling burning almost 400 gallons ready to go at a moment's notice.

    Those were extremes. The 2100 mile episode resulted from Mr Dowdy's decision to ban California fuel purchasing for a short time. Essentially were buying too much fuel in CA then. There I was deep in the NW and looking at Arizona as next fuel. I had doubts. But she did it but a little dry tanks for my liking. CA was #### big N to S... ugh.

    I lean towards engines that you get big horse, old time Jacobs Braking of highest quality and everything else will take care of itself on the theory that big doggies don't have to strain themselves to lift you over the rockies.
     
  8. JonJon78

    JonJon78 Road Train Member

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    1.75 to the truck for flatbed?
     
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  9. Midwest Trucker

    Midwest Trucker Road Train Member

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    Your paying yourself $375 per week to drive the truck? Your about $1000 light on that.

    I’d put your maintenance at .25 per mile. I’d say your insurance is likely to be higher. What about trailer costs?

    I’d readjust your target revenue to be $3.00 per mile. You’ll make nothing at 1.75 running how you say you would prefer to run.
     
  10. REO6205

    REO6205 Road Train Member

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    A 15K dollar truck? Can you do most of your own wrenching and service?
     
  11. FoolsErrand

    FoolsErrand Road Train Member

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    There will be a lot more good trucks for sale in the 15k range after a year of these low spot market rates from attrition. Meaning the same 15k will buy a better and better truck as the weaker operations seek an exit from the downturn.

    Food is a hundred a week or so, didnt see that in your estimates.
     
    x1Heavy Thanks this.
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