To those that work for low rates...

supergreatguy · Jul 12, 2022

runningman0661 said: ↑

You made some valid points in your original post, but I love when people say don’t haul “cheap freight”. Can you define cheap freight? If one operator has low operating costs and no equipment payments, he can afford to haul for less than some schmuck, that went out over the last few years and overpaid for his equipment, ran out got his own authority, and is paying out the arse for insurance for the first two years.
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exactly, it’s never about what you make. It’s about what you keep. Someone making profit on 1.50 vs someone breaking even on 3.50. I’d happily be in the 1.50 boat

supergreatguy · Jul 12, 2022

F4T6UY said: ↑

This topic is so individual. This is business. That driver in the next lane is your competitor. Fact. Still your brother, but your competition in business. Not the broker. Not the shipper. Your brother.

All these calls for unifying and sitting is nothing more than a pyramid scheme. Good luck. All you’re in fact trying to do is speed up the inevitable natural ebb and flow cycle that is this business. Just wait. Those that want to sit, will sit, because they HAVE to sit. Some businesses fail.

Yes, Rates are dropping, fuel is low, equipment is expensive and this business is easy to get into, therefore ill prepared unorganized people get into it.

You’re original post was accurate and well written, but I’ll admit I got bored and initially skimmed over it, because any mention of banding together and sitting makes my eyes roll and the following fluff loses credit.

Some people are struggling hard right now, and those are the ones you’ll definitely hear from. While others are continuing to flourish. Why is that. Natural business competition. For the same reason Chic-Fil-A has a line out to the street, and Wendy’s across the way doesn’t even have a car in the drive thru. Some do it better.

If you did things right, heII, just did things better than 30% of the blind dreamers that got in this game…just wait. They will sit. Because they have to.

As a businessman, If a guy is telling you to sit because he cant even cover fuel, but you know you’re still making good money and realize the profit in your game is still better than it was in 2015, would you sit with him, or go steal his customers?

I don’t even know if I will make it through this, but it will only be the mistakes I made if I don’t. But I feel pretty good about it, and I like the other irons I have in the fire…
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That’s right. That’s the whole point in the USA. SET UP RIGHT AND LET THE SUCKY SET ER UPPERS FAIL. Just how the poop rolls. Either get with it or get sat down. Nothing more, no hard feelings.

I bought my junk CHEAP, and rebuilt during CHEAP parts market. Now I can sit as much as I want, make money when I want. I can range from 1.50 a mile to 10+ a mile and make money. I don’t give a $**t about what the avg rate is. Stocks make money, truck makes money, wife makes money. ESS ALL ABOUT THE SET UP BABY.

supergreatguy · Jul 12, 2022

Rideandrepair said: ↑

I too prefer to net $1000 per day. Break it down, let’s see some details, real numbers. I’m sure you have detailed spread sheets with Charges, costs etc. Show is how it’s done. Always willing to learn, from those more experienced.
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barking up the pile of a mf that barks a couple times only gets you a couple more barks. Are you met with a pos that ONLY has money?? Numbers, money, spreadsheets?? F*** em

bad-luck · Jul 12, 2022

Renegade92 said: ↑

I recently heard about a OO that in refusal to work for low rates, parked his truck for 4 months. I really respect his decision, effort, and financial ability to PARK. If trucks, and not just a truck were to do the same thing, all over the country, I do believe the opposition could be made to hurt. I do believe that change could happen.

Unfortunately, he was alone, and therefore his impact was futile.

Things need to change.

Before I continue, let me make it clear that the rest of this message is not directed to those OOs who have managed to operate successfully and have withstood the test of time. Rather, this message is for those who have created a situation for themselves that does not allow them to park. A situation that requires them to roll their wheels to the tune of rates that are way too low. My intent while writing what I have written below, is to constructively criticize, and nothing less. Please do not take offense.

From what I've gathered over the years, from reading discussions on this website, and talking with some guys that I went to high school with who are now Owner-Operators, and from meeting OOs while on the road myself, the ability to start a trucking business is too easy.

What I mean by that, is that these days, it seems like anybody can start/have a "trucking business". I'm not talking about the fact that getting approval for financing is too easily given, and too easily accepted. The notion that modern society is too comfortable being a slave to financing and debt, is a conversation for another time.

I am talking about my observation, which has shown me that many OO are blind, in ways that aren't good for them:

Blinded by the pride that comes along with being able to claim that they are their own boss. Blinded by the pride that comes from claiming that they own (technically, they financed; the bank owns it until it is paid off) their own truck. Blinded by the pride that comes from being able to claim that they have their own business. And last, and perhaps the worst, blinded by the pride that comes from the ability to claim that they are "grossing" six figures annually. Those of us who actually know something, know that gross isn't worth anything; it is all about net.

And blinded too by an attitude of ignorance that is too common. An attitude that entails an OO not knowing and doing things that any responsible and competent business owner should know and do in general, regardless of the business.

Such as not knowing what his true operating-cost-per-mile is, aka his break-even point. Not knowing what his profit margin is, as in not knowing how much money he is actually making and taking home. I understand that OO have a long list of items to pay for, and that the math will require effort to solve. But, if you have chosen to be a business owner, your refusal to do the math will ensure your failure. Learn the math, or get out.

Also, not accounting for the real depreciation of his equipment (in the case of OO, very expensive equipment). I'm not talking about "phantom" depreciation, which has to do with the IRS. I am talking about acknowledging the fact that equipment has a lifespan. In the context of trucking, that lifespan is measured in miles. Real word wear and tear will require that your equipment eventually be put out of commission, and replaced.

And further, not respecting their time-worked. The CPM pay structure in general, is problematic as it is, as it does not take into account real world delays. But when you drive for low rates, it becomes even worse. Detention and layover fee amounts, are not suffice either.

Instead, many just believe that if they keeps the wheels rolling, they are "making money".

And so you end up with an industry that is full of businesses burdened with financing, and "leases", etc., for which the true costs aren't even known nor understood.

Which leads to an industry full of businesses that have to do one or more of the following, throughout the life of the business, just to survive. Not thrive, but survive:

-Utilize factoring to compensate for their mismanagement of their cash flow's timing
-Settle for profit margins that are too lean if even existent at all
-Operate with a perpetual lack of cash reserves.

Not all OOs are like this. But many of them are. Further, enough of them are, so as to hurt the industry as a whole, for everybody.

Ask yourself the following:

-How can a business be expected to turn down work if their cash flow is so messed up, that factoring is relevant?
-How can a business be expected to turn down work, when they don't see that the rate, and it's entailed profit margin, is too low?
-And how can any business be expected to turn down work, if they are broke, or just about broke, as in there are no cash reserves to call on?

What all of this means, is that a large portion of businesses in trucking are operationally incompetent, and thus financially weak, to the point of dire straits.

The opposition, the brokers, they know this. And they push those offensively low rates on the market, because history has shown that somebody will take it. They know that their is no reason to push a decent rate, when many will settle for less. And evidently, many are settling for less.

The industry is paying just enough to survive.

The only way things will get better, is if those who are operating as I described above, to change your ways. To realize that the worth of false-pride, is nothing. To learn about business and your business, so as to fix your incompetence. Or, to just get out and don't look back.

And further, for anybody who has yet to get in, who plans to do things the wrong way, to stay just away.
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You have made some good points here. The number one thing that I have learned over the years that is the deciding factor that one wants to become an owner operator is money.

They talk to a few people and hear about how much money that person or persons are making and they are hooked. They start to dream about how their life would be with more money. And there is nothing wrong with that as its human nature.

However, they don't have a clue... we see it here all the time, guys don't even have a CDL yet and they are asking about advice on buying a truck. Or have 2 months of experience and just bought their first truck, a prostar with a maxiforce.

Trucking is like no other business, you can have great business skills and an MBA and still fail at trucking. Because they know nothing about trucking.

Rideandrepair · Jul 12, 2022

Well, today I got lucky. Stayed at the motel as long as possible. Got loaded 15 minutes away. About 2:00 I was loaded, 21k lbs in 28 ft. Still had 24 ft of Trailer available. Found 18 ft. @ 23k. All on my way, So 2 picks, 2 drops. Total $2800 for total of 750 miles. $3.74 pm from Allentown to Grand Rapids. Lucky I found something that ships late. Usually not so lucky. Feels good. This is why I don’t make plans. I have enough deadlines and appointments to make. I’ll decide tomorrow wether to deliver GR after Detroit, reload and keep rolling, or go home, till Thursday morning and Deliver GR on Thursday. I’ll decide tomorrow morning, after delivering Detroit. Now just gave to safely deliver, Lol. Not the best part of town. At least the Projects are gone. My wife and I will be strolling down memory lane, Lol. We both grew up about 2 miles away. Stay safe everyone. Time to hammer down, get out of Pa. before they figure out I’m here.

bad-luck · Jul 12, 2022

Rideandrepair said: ↑

Well, today I got lucky. Stayed at the motel as long as possible. Got loaded 15 minutes away. About 2:00 I was loaded, 21k lbs in 28 ft. Still had 24 ft of Trailer available. Found 18 ft. @ 23k. All on my way, So 2 picks, 2 drops. Total $2800 for total of 750 miles. $3.74 pm from Allentown to Grand Rapids. Lucky I found something that ships late. Usually not so lucky. Feels good. This is why I don’t make plans. I have enough deadlines and appointments to make. I’ll decide tomorrow wether to deliver GR after Detroit, reload and keep rolling, or go home, till Thursday morning and Deliver GR on Thursday. I’ll decide tomorrow morning, after delivering Detroit. Now just gave to safely deliver, Lol. Not the best part of town. At least the Projects are gone. My wife and I will be strolling down memory lane, Lol. We both grew up about 2 miles away. Stay safe everyone. Time to hammer down, get out of Pa. before they figure out I’m here.
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Perfect example of how it is done! Didn't know you ran PA, we have probably shared the same highway.

God prefers Diesels · Jul 12, 2022

PoleCrusher said: ↑

It's funny to me when I see these threads. I've had numerous discussions with o/o that can tell their fuel costs to the ¹/1000 of a penny, tires down to how much rubber they leave on the road per foot, McDonald's/mi expenses for every happy meal, etc....

Every one of them is looking to lower their expenses, so they can bid cheaper. Trying to compete with megas on the megas' playing field, then end up crying over low rates. Makes no sense to me.

My cost per mile today is not the same as it was yesterday, or last week, or 6 months ago. Hell, back in 2020 I was buying fuel for $0.95/g, running for $2/mi. Last week fuel was over $6/g, this week it's around $4.5. Fuel, tires, breakdowns... all can fluctuate wildly. All you can do is prepare the best you can, plan for the worst and hope for the best.

The other thing that gets me, is when people put their fixed costs in their so called "cost per mile". It doesn't matter if that truck turns 1 mile or 50k, truck payments, insurance, plates.... those costs are the same.

And when you say it's about hard work, yep, you nailed it. That's the real common denominator in every successful o/o I've ever met, hard work. It's not all physical or driving work, some is figuring and planning and strategizing. The fact is though, if you don't get out there and do the work, regardless of anything else, you will fail.
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I still don't know my cost per mile, lol. I capture all the raw data, and my Excel workbook is about ten tabs wide, but the only thing I bother calculating is tax stuff.

My equipment is paid off. My insurance is inexpensive. I do my own wrench turning. I don't pay full price for fuel, and I've only hauled for less than $3/mile one time this year. So if I can't make it on all that, then I'm doomed.

I'm already running a tight ship, and I haul for the best rate I can negotiate. Cost per mile doesn't even enter my mind when negotiating rates, because I want the maximum no matter what. I'm not trying to underbid people, so I don't need to know how low I can go. It's irrelevant to me.

If the net cell is black, I'm good. If it's red, we got problems.

xsetra · Jul 12, 2022

I see how the spread sheets help an office dweller keep track of expenses. Every Quarterly filing shows your business situation.
But I drive my own truck, it's just me, I know how much and when is getting spent. I have all my major expenses for the year due the 1st quarter. I pay them all off and save for the rest that are due thru July. Rest of the year I only have to worry about repairs and fuel.
Pretty easy to keep track.
Good luck to all of you in the days to come.

supergreatguy · Jul 12, 2022

Rideandrepair said: ↑

Well, today I got lucky. Stayed at the motel as long as possible. Got loaded 15 minutes away. About 2:00 I was loaded, 21k lbs in 28 ft. Still had 24 ft of Trailer available. Found 18 ft. @ 23k. All on my way, So 2 picks, 2 drops. Total $2800 for total of 750 miles. $3.74 pm from Allentown to Grand Rapids. Lucky I found something that ships late. Usually not so lucky. Feels good. This is why I don’t make plans. I have enough deadlines and appointments to make. I’ll decide tomorrow wether to deliver GR after Detroit, reload and keep rolling, or go home, till Thursday morning and Deliver GR on Thursday. I’ll decide tomorrow morning, after delivering Detroit. Now just gave to safely deliver, Lol. Not the best part of town. At least the Projects are gone. My wife and I will be strolling down memory lane, Lol. We both grew up about 2 miles away. Stay safe everyone. Time to hammer down, get out of Pa. before they figure out I’m here.
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I’ve worked 8 days in the past two months. What are appointments and what do they feel like? I’ve only accepted open loads and cannot get myself to deliver until midnight

Rideandrepair · Jul 13, 2022

supergreatguy said: ↑

I’ve worked 8 days in the past two months. What are appointments and what do they feel like? I’ve only accepted open loads and cannot get myself to deliver until midnight
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Lol.

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