"The almighty $2.00 a mile theory"

Not every load will meet or beat your break-even point and make a profit. You need to develop your freight lanes so that when you've completed a month and a quarter you are showing a profit. There's a good blog article on Getloaded that explains this.
http://getloaded.com/content/how-profit-cheap-freight

It's the over all revenue from a round or several rounds over a period that must make a profit. If you at least met your BEP on the round you did OK, just can't afford to do that every round. Occasionaly it has to be for the cash flow. But the overall objective is to profit.

By the way it's not just the WI public schools, I'd say it's our national public schools - Teaching to a #### test, hell that's how most CDL schools teach today- to pass the test.

How many of you pay yourself a fixed (not per mile) salary as an expense and actually leave your profits in your business account?

 

Hmmm.....

This thread has become a liars, braggers, and whiners convention....


I'm going to pizz many off with the following...

If someone can run for $1/m and still profit from it...More power to them.....

Why is it that we set a baseline of $2/m anyhow?

You don't see a minimum in other businesses....

For an example....a writer doesn't set a minimum established on a "baseline"......They negotiate a contract with a publisher based upon their value as an author....

To be sure there are O/O's out there who can and do run and profit with a $1/m average...

They may have no mortgage on their equipment.....No other bills....No families back home....
Others may also receive government contracts...and so on....


From my perspective....Running a $1/m would drive me under....I can't make that average work under the current conditions......Not only that...I'm a Cali based carrier...I'm under more strict conditions than say a carrier based out of Arizona...I'm under more rigorous rules than a carrier who never runs to California....So therefore...my business model must work effectually under those conditions.....

So instead of whining about how others "stealing" from your business....concentrate on your business and run your business your way.......

The loads are out their.....The freight has to be moved....

If a shipper wants to move it for a $1/m...You don't have to move it if that's not in your business model...simple as that....

Cheap freight is all "relative" anyway.....I remember a couple of years ago I moved a tank for $2/m and received a lot of sheyat for it because I was "hauling for cheap".....

Now the NAFTA rigs and the "Bottom-feeders" will always be here...They will always haul the "Cheap Freight"....This will never change unless government becomes involved and gets back into the business of regulating rates....

Do we really want that to occur?

Do we really need more government involvement in our business and in our lives?

 

[QUOTE=" OPTIMUS PRIME ";1662809]Are you making the avg. of $2.00 a mile (or close to it) before the cost of fuel or after?
[/QUOTE]It seems to me some of you are forgetting the original question. Some of you are whining,complaining,bragging or trying to explain how you make a profit or trying to teach others how. Or who can/can't haul for $ X per mile. The question has been answered by some and hijacked by others.

 

I did not see that part just the part of low paying frieght out of e PA, sorry.

 

[QUOTE=" OPTIMUS PRIME ";1682481]Wow!!!!!!!
I did not know this, I really didn't. That is outstanding, I didn't mean to leave out anyone. If you are making a profit with a $1/m please by all means post in this thread b/c I would like to hear from you as well. If you can make it work with that amount then $2/m is really a bonus. But I hear many complain about "DON'T HAUL CHEAP FREIGHT" but I never looked at it from that point of view. It isn't cheap at all to someone who is making a profit off it. I would love to know how you got your b.e.p. so low, along with your profit info.(Not to get off subject but I think that info would help explain to me and others how you are able to profit from those runs.)


I agree with you 100%.

You are right once again. But it's cool, hopefully it wasn't done on purpose. Even if so, I still appreciate all comments. Besides I think we are doing a good job keeping them in line when they get off track.[/QUOTE]
You have much to learn about business then.....

How is it that Swift requires a lower B.E.P (per rig) than a "Single Pony" carrier?

Anyone in the biz long enough knows that answer and can recite it in their sleep....

Business isn't fair either.....It took me awhile to get over the fact that certain bizzes will always have subsidies and, There's not a ##### thing the rest of us who don't qualify can do about it....Other than to complain....

The simple answer is don't compete with Swift or the "Designated" carriers...Find your own lanes and fill those needs....

If you worry about how much the other guy is making...You are wasting time...Valuable time that you can utilize making your own money...your way.....

 

Very true about a company with a lot of trucks having a lower BEP than a single O/O. Some of the expenses are spread out over the number of rigs that are running, where as a single O/O has all expenses on one vehicle. Doesn't take too much to figure that one out! Thanks for bringing that one up!

 

No need to be sorry I think I forgot to put it in the original post.

As to what WCP has stated.... I can go out and make a living off of alot less than most being most of my stuff is paid for, but that doesn't mean I should.

I had a buddy who had the theory.... a load on my wagon and I can make money, It'll figure out at the end of the week... Well, he was right, toa point. What he and many fail to realize is hauling a load cheap may cover your fuel, but its also alot of wear and tear on your equipment, versus runnign empty.

Now at the end of the year we did some figures... After it was all said and done, he made more than me, but ran a lot more miles.... and more miles means more wear and tear. He ran 160k+ miles where I only ran 120k.

That theory worked out ok when freight was plentiful and rates, even cheap rates, weren't all that bad. when things went down hill, so did he!

I'd take a pic and post it of his KW, but it really looks bad with no hood or doors!

 

Excellent advice- know your BEP, establish your rates based on your BEP, then find freight lanes and customers (shippers and brokers) who are willing to pay your rates . The real secret to success is developing a freight lane with multiple customers (not dedicated freight). Diversify your freight base so no single customer, broker, or agent represent anymore than 25% of your total revenue. It's getting the right mix of freight with the right mix of customers, in the right lane(s). Not rocket science. Making a decent profit in trucking isn't hard, as long as you don't follow the crowd. It's not how many miles you drive but how smart you drive each day.