Do you know what your ARPD is?

[Bruno]

In this business eveyone always talks about they want to drive for the best company out here. One of the best ways to make a good choice is to ask the company what the fleet ARPD (Average Revenue Per Day) for your size unit. The last six months I have been off the road getting Fleet Management Services moved in to our new office in Rittman, Ohio.

I have been putting things together for next years goals, talking to different owners like Davekc and Greg to see how they do things as far as backhauls and the different things they do that I don't. When I worked in the Rent to Own business before signing on with Roberts Express we had projection sheets that we went over in the managers meeting each month. So I sat down and came up with a goal for the gross revenue of the trucks for the month of December. I knew what the ARPD was for the month of November. I wanted to set a goal that was twice as much revenue in the month of December as we did in the month of November. I stayed on top of this goal by checking the ARPD daily. Keep in mind this is a fleet of trucks I'm taking about. As of last night the company is $3000.00 over the goal I set for the fleet.

By setting goals for revenue each month and checking them daily you find it a great way to gross more income. Now I know some will ask did the cost of doing business go up? No It went down because I was checking things daily. Now was I micro managing drivers or mother hening them. Nope I let the drivers do there thing as far as what loads the did or didn't do. So set goals for your business that way if you hit 95% of that goal your still a winner in the long run.

 

[fortwayne]

Dave, I would totally agree with checking your numbers daily. I too ran a business outside of the transportation field for 15-years and by checking those numbers you had a picture of what you would have to get done for the rest of the week, month, quarter and year to hit your objectives.

Also, what kills me is when you ask people what there goal is in life, as an examble, alot of people would say to own their own house - and that is of course a great goal.

However, when you ask them how they plan on reaching that goal, they have no plan or they simply say to have a good down payment - yet, once again no plan on how to get that down payment.

Daily planning is everything - failure to do so is just that - a failure.

 

[Bruno]

ARPD is a good thing to keep track of daily. A $700.00 ARPD for a truck would be a great month for a truck.

 

[pjjjjj]

In this business eveyone always talks about they want to drive for the best company out here. One of the best ways to make a good choice is to ask the company what the fleet ARPD (Average Revenue Per Day) for your size unit......

.....So I sat down and came up with a goal for the gross revenue of the trucks for the month of December. I knew what the ARPD was for the month of November. I wanted to set a goal that was twice as much revenue in the month of December as we did in the month of November. I stayed on top of this goal by checking the ARPD daily. Keep in mind this is a fleet of trucks I'm taking about. As of last night the company is $3000.00 over the goal I set for the fleet.

By setting goals for revenue each month and checking them daily you find it a great way to gross more income. Now I know some will ask did the cost of doing business go up? No It went down because I was checking things daily. Now was I micro managing drivers or mother hening them. Nope I let the drivers do there thing as far as what loads the did or didn't do. So set goals for your business that way if you hit 95% of that goal your still a winner in the long run.

Not meaning to be argumentative here, but..... how do you figure that setting a goal, or even choosing an arbitrary goal of double the revenue from month before, is going to be a great way to gross more income?

If you set the goal, and check it twice (daily), it isn't going to make the goal realized, and especially if you are signed on with a carrier who happens to be in control of what you are offered.

Sure it's great to set a goal, and see how you are keeping in line with the stats, and realize that if you're behind on a given day of the month, you're going to have to run a lot harder for the rest of the month in order to keep up with the end-of-month goal... but how does this get you more loads and revenue? And especially if you aren't mother-henning and micro-managing your drivers by demanding they accept load offers that they wouldn't otherwise take?

That's wonderful that you are over and above even your seemingly arbitrary, double-the-month-before goal, congratulations on a spectacular ending month to your calendar year! But how did choosing that goal and checking it daily impact the results? And how did your December 09 goal relate to December 08? Thanks for any further info.

 

[fortwayne]

pjjjjj -

The point I would make on that is that if you see your goal is not being reached at a current pace after you check your stats, you get on the phone and ensure that your dispatch has you in service, maybe you tell them that you will take a short or long run, eastcoast, south, west, New York City, Laredo, wherever.

Maybe you were planning on taking a day off, well, instead you don't take that day off and you stay out.

Sure if a carrier kind of controls you getting a load or not it puts you behind the eight ball a bit, but, like I said, get on the phone and talk to them, let them know you are willing to go that extra step to get the load picked up and dropped off on time because maybe your sitting there with three other trucks and dispatch is getting no help from them, but then you call, and they can move the load.

I think there are alot of things you can do to ensure a carrier is a dispatch asset in reaching your goals rather than a holdback on you reaching your quest. Its about building a relationship with the customer and just as important with dispatch and management.

 

[FIS53]

You're quite right that formulating a decent relationship with dispatch helps and keeping your truck in their minds does have its rewards. It has been a strategy I've used over the years and it definitely has kept me moving more than some of the others. But as PJ has implied dispatch can also be that holdback even with the calls to them and they don't have the runs available that pay.

While making goals and trying to meet or exceed them is great. If there are others holding the strings for the work then reaching those goals may require a rethink on part of the strategy in reaching those goals especially as others get into the game and some of them will.
Dispatch or the company only have so many runs available as more fight to get a share of the pie, what worked for these few months may not work so well in the future. Therefore take what you can while you can and keep planning as more o/o's will join in the fight for a share and diminish yours (unless you're trucks are more attractive).
Rob

 

[Turtle]

As an independent contractor, dependent on a carrier and/or shippers to have available freight for you to haul, and being in the right place at the right time, setting goals is admirable, but it's an exercise in wishful thinking more than anything. Unless you have the absolute power to control what and when you haul freight, at all times, you have no control whatsoever over the ability to reach your goals. Oh, sure, you can "run harder", but that's still wholly dependent upon a load being available for you to run, something you have no control over. You can call dispatch until you are blue in the face, but contrary to popular belief, dispatch cannot manufacture a load for you, regardless of how good a relationship you have with them. Having your own authority doesn't guarantee you anything, either. You can bid stupid low and come up with revenue, but it's meaningless unless it's a profitable load. Bidding for lunch and fuel money in order to attain some arbitrary daily average is hardly meaningful. And ensuring that you are in-service and available for a load is no guarantee that you will get one.

Your carrier's ADRP is a far different thing that your own. Theirs is an average of many, yours is an average of one. Their figures have almost as much meaning to you as their daily load count does. Trying to reconcile or correlate the two figures is an exercise in futility, for even when the figures coincide it's just that, a coincidence. It's about like taking today's high temperature and comparing it to the historical average or "normal" temperature for the day - it's meaningless, since today's temperature isn't an indication of anything at all other than just one more number that will go into the pot of numbers used to yield the average or "normal" temperature for that day. And you have about as much control over your own ADRP goals as you do today's temperature.

The only way your own ADRP becomes even marginally meaningful is when you have enough of a history to begin comparing your current ADRP to your own historical ADRP. And even at that you must make adjustments for your profitability and CPM over time. If you crunch the daily numbers in a meaningful way, you can yield some interesting albeit marginally useful information, but if you look only at raw numbers and fail to put in the time and effort involved at getting useful information, what you end up with is at best an illusion, regardless of whether or not you have attained your wistful goals.

An ARDP is an after-the-fact result, not something to be reached for on a daily basis. Most people know what their daily fixed expenses are, those relentless costs that tick along whether you are in or out of service. It's unrealistic to try and cover those daily expenses on a daily basis, just as it's unrealistic to try and achieve some ARDP on an daily basis. It's much more realistic to track these numbers over time, tracked monthly, quarterly, and annually. There are simply too many variables, ost of which are out of your control, to look at some ARDP and glean anything meaningful from it.

 

[Steady Eddie]

I never thought much about the ARPD. Not much use for it. Means nothing to me, as with the daily load count. My load count from day to day is what I look for. If I'm not included in the carriers load count, I don't care.

History from prior months, year are a far better way to forecast and set your goals, (budget). based on historical data, I can set my 2010 budget by Quater, and this should show real time data from past history.(months)

If my revenue increased 5% avg over a 5 year period, then why wouldn't I show it for 2010 budget? The same with exspense's. All things being equal, making adjustments as current events dictate, you should have a better grasp on you numbers. Don't need to micro down to a daily number....(rate)

 

[Bruno]

I guess it can be harder for a single truck owner to set an ARPD goal for his truck. A fleet owner can set a ARPD based on 2 to 100 trucks if they have that many. We base our ARPD goal on what the trucks did in the last 30 days. Then you have to look at what last years income is for the the same month. Lets take Decembers ARPD, it's going to be higher than the ARPD in January. January is a slower month so you have to know its not going to be as high as in the month of December.

By setting a goal each month you have something to shoot for. No, your carrier can't make up a load for you, but you may think twice about turning that $1.30 a mile load that is 450 miles. Most drivers are looking for the golden load every time which we know causes turn downs and trucks sitting. I asked my older brother who drives one of our trucks with Panther to run the whole month of December and follow my 13 day out program. My brother drives team in a C unit dry box. He was home after being out 12 days for the weekend and then back home for 5 days for Christmas. Both times home he was on a load that didn't deliver until Monday.

His in service for December was a 100% and that truck had the best month ever at Panther and he was at home during the month. Is it going to be like this every month? No, but with a goal for our trucks and we make 90% of the goal we set we are still ahead.

In this business everyone doesn't have a positive outlook on things and they think negative about things. If you think positive about things you will fine your luck will change. I know it sounds crazy but it's ture. My wife got me a book and then the DVD called "The Secret" The Secret :: Official Web Site of The Secret Movie :: Law of Attraction I watched the DVD and it has changed my life and our business. If you have the time to read or watch the DVD it will change your life like it did our.

The Law of Attraction really works, it did for me I know.

 

[davekc]

When Dave asked me about this I had no clue what he was talking about. Maybe a new retirement program?
The only thing I look at daily would be what the costs are for me and the cost to the team if there is no productivity. There are only so many days in a month, and for every day you sit, it still has a attached cost. Outside of that, I only look at things by the quarter. Too many items or variables that are already mentioned by others as to why I don't look at things daily.

 

[Bruno]

When Dave asked me about this I had no clue what he was talking about. Maybe a new retirement program?
The only thing I look at daily would be what the costs are for me and the cost to the team if there is no productivity. There are only so many days in a month, and for every day you sit, it still has a attached cost. Outside of that, I only look at things by the quarter. Too many items or variables that are already mentioned by others as to why I don't look at things daily.

Thats funny Dave. At the 1st of each month I take the stats on the truck from the same time the year before and what the truck made the month before to help set a goal. I take what the ARPD was last year for the same month and the month before and set a goal. I just started doing this again. Our trucks did better in the past when I did do this each month. These are goals thats all. Nothing wrong with setting goals for trucks.

 

[Turtle]

So you set, say, a ARPD of $500 for a given truck. What happens the day after they didn't do $500? Do you call them up yelling and screaming at them for not getting a load of at least $500?

 

[Bruno]

So you set, say, a ARPD of $500 for a given truck. What happens the day after they didn't do $500? Do you call them up yelling and screaming at them for not getting a load of at least $500?

No, The ARPD is based on all 30 days as a fleet. Lets say you have a fleet of 5 trucks and you wanted them to gross $12,500.00 each or $62,500.00 as a fleet. The ARPD based on 30 days would be $2083.33 for the fleet per day or $416.66 per day for each truck. If a truck gets a load that is 2500 miles paying a 1.35 per mile which is $3375.00 and it takes them only 3 days to do it, they are ahead on ARPD by $2125.02. For the most part it works Turtle. Call me sometime bud.

 

[Turtle]

Yeah, next time I'm up there I'll give ya a call.

 

[Moot]

...setting goals is admirable, but it's an exercise in wishful thinking more than anything. .

Oh how wrong you are! It is an exercise in positive and powerful thinking. I have read self-help and motivational books by Tom Robbins, Penn Geller, Norman Vincent Rockwell, Tim Allen and Vince Lombardozzi. One of these dudes can even bend a spoon with his mind. If he can do that, how hard would it be for him to pull a high paying load out of a dispatcher's butt on a daily basis?

Bruno, I guess this post goes a long way to explaining the following quote from another post.

I work about 70 to 80 hours a week on avg doing this with 5 trucks of an owners trucks. I had to hire a Fleet manager for our trucks because I was only getting 5 hours of sleep each day.

 

[Moot]

My wife got me a book and then the DVD called "The Secret" The Secret :: Official Web Site of The Secret Movie :: Law of Attraction

Will all this stuff work now that it is no longer a secret? Will the author change the title?

 

[Bruno]

Oh how wrong you are! It is an exercise in positive and powerful thinking. I have read self-help and motivational books by Tom Robbins, Penn Geller, Norman Vincent Rockwell, Tim Allen and Vince Lombardozzi. One of these dudes can even bend a spoon with his mind. If he can do that, how hard would it be for him to pull a high paying load out of a dispatcher's butt on a daily basis?

Bruno, I guess this post goes a long way to explaining the following quote from another post.

I was talking about mine and my wifes 5 trucks we own. I had to hire a fleet manager for them. I hired my stepson to run them. I have 10 others I manage. Try getting some work done with 15 teams calling you all the time.

 

[Bruno]

Will all this stuff work now that it is no longer a secret? Will the author change the title?

Read the book or watch the DVD then ask me that. I know this may sound crazy but it does work. Last month I set a high goal for one my owners fleet of trucks and the fleet did $4597.54 over the goal. I set a goal of $2500.00 ARPD for the month of January for the same fleet of trucks. I know they can do it, I'll let you know how it turns out at the end of the month. Today the fleet beat their ARPD of $2500.00 by $1382.79 as a fleet.

 

[x06col]

Fifteen calls @ ten minutes might be hunnert fity minutes, by my figgur'in. Be a couple hours plus??? If yer not finding freight for em, where does the other twenty sum hours go.

Oh, my bad. I guess i'm that busy at the Pass, an better not throw those stones.

 

[greg334]

Well I see this thread kind of went all over the place.


Got to tell you Dave that the “secret” has been around for a while, it's great that you found it. It is based on the work of W. Wattle's book “the Science of Getting Rich” which is actually a good book to read with his other books and the books of Haanle, Haddock and Towne (to mention a few). It seems to be the basis for the up and coming Intention-Manifestation which is also based on part of the authors mentioned and may be Oprah's next thing, I think she has done something on NLP and a few other new age things but who knows with her, she just keeps making money and crapping on people – maybe she made a deal with the Devil?


I'm just having too much fun tonight.


I personally like Chris Brogan's take on things with some of the others like the Zen “power of less” ideology in business thrown in there for good measure. There are a lot of things people can do to remain positive in cr*ppy condition, but the negativity any person has can actually be harnessed for positive results, but most wouldn't understand that.


To the ADRP thing.


Yes it is one of a few metrics used to measure performance but... it is one that needs to be used as an established metric with lots of trucks behind it, I would say at least 5 near hands on managed trucks would use this number.


I tell people to figure out their break even point for a single truck and then the fleet, then look at how to leverage your situation with specific goals in mind.


Panther, unlike other companies and as Dave mentioned allows the use of their authority for owners at 15%, that is a big deal because it means that your ADRP goals (if you want to use that number) and your Contribution Margin per unit in your BEP calculation can be something that you can control. Unlike say FedEx (one example) where you are locked into their system and can't maneuver at all, a fleet owner is overly dependent on the company to provide the work as much as a single truck owner and there is too much favoritism that is possible there which kind of takes the joy out of it. Landstar (the other example), well that's a bit different – with the system they have, it is as difficult to control things as it is with FedEx to a point, the saving grace is the agent and the flexibility they have when you build a relationship with them.


Well I digress


Bruno's point is one of a few on how to manage the numbers, which is a good thing when you look at the big picture. A lot of fleet owners don't know what to do in order to see where the rough spots are and how to solve them. A lot of owners still treat this as a vacation benefit then cry about cheap freight.


I was talking about BEPs this afternoon and it seems a lot of people think it is a simple to figure that out. I pointed out that past numbers help you with it but it is dynamic and should be figured every month until you get a grip on things. Which brings up the real point about the ADRP thing, that's for fleets or seems to be but as a single truck owner, it maybe a smart thing to figure out by the month how well you are doing, not daily or weekly. It takes a lot of pressure off of you that way and gives you a clearer picture.



Back to reading and being bored.