Flat rate vs Percentage dry box. Part 3,456.

[Dreamer]

Question for dry box trucks only, any company.

I'm asking this separate from Phil's thread so as not to derail it.

Assuming you were paid flat rate $1.30 including FSC for all miles dispatched, including deadhead to pickup, run miles, and miles to authorized layover...

Would you have made more or less over the past year? Granted, the trucks at Fedex going to this are part of a test program using load planners, so they will see more pre-dispatch on the loads that are scheduled ahead...which is about 50% currently.

I just want to know. When you divide income by ACTUAL miles, which way would it pay more.

In my opinion... if you had high deadhead..you make out better... low deadhead...company comes out better.

Dale

Posted with my Droid EO Forum App

 

[davekc]

At 1.30 plus a decent surcharge, (.40 to .50) it would be a close call actually. That would have you running at 1.70 to 1.80 for all miles.
If it was a dollar plus the FSC, then it is a no brainer. Better off without the flat rate deal.
I am basing this on a fleet deadhead average this year of 11 percent.

 

[Dreamer]

Thanks Dave... with low deadhead, I agree. But, you really work for your trucks.

Dale

 

[TeamCaffee]

One of the things to consider Dale is if the dead head was authorized or not. Many of us as Jim mentioned go where we think the freight will be and that is not always where the computer picks for our layover.

I took our total mileage which was off of the truck odometer taken on January 1st to December 31st with what we made and the we would have done better with the flat rate program. We made the decision to dead head to several different events and this often would effect what loads we would accept or not.


Other companies I believe have get home programs that ned to be taken into consideration as we would not be comparing apples to apples.

 

[jjoerger]

Since we usually DH to an active freight area, regardless of the layover option, we ran a lot of unpaid miles.
I took the total miles the truck ran this year, minus out the personal DH home, then divided my gross by those miles and we came up with $1.35 per mile including tolls assistance and accessorials.

 

[TeamCaffee]

At 1.30 plus a decent surcharge, (.40 to .50) it would be a close call actually. That would have you running at 1.70 to 1.80 for all miles.
If it was a dollar plus the FSC, then it is a no brainer. Better off without the flat rate deal.
I am basing this on a fleet deadhead average this year of 11 percent.

Dave brings up something else to consider is the truck a O/O or is the truck part of a fleet. The truck in a fleet situation is often keeping three families afloat.

Our truck is a one truck operation with us the drivers. All money goes into one account.

 

[davekc]

Linder is correct.
I would look at things differently because I am looking at a whole operation, verses a single truck. There would be some differences. That dreaded phrase, ROI and all that it entails goes into how I do things. A single truck may not even look at that as we have found from previous posts.

 

[greg334]

BUT as part of the FedEx system, the way I understand it works is simply they have a separate dispatch system with a different purpose - trying to keep the trucks loaded.

IF this is the case, the idea of moving to an 'active freight' location becomes a moot point if they keep you moving or willing to pay you the full rate to move to a location after X amount of hours sitting so they can utilize your truck for their use to cover their customer.

 

[pjjjjj]

Dave brings up something else to consider is the truck a O/O or is the truck part of a fleet. The truck in a fleet situation is often keeping three families afloat.

Our truck is a one truck operation with us the drivers. All money goes into one account.

TeamCaffee you are quite right in that the operations are different. This post is not aimed at you, but to any OOs who may believe the difference in how a fleet owner evaluates his business does not really relate to them.

In a financial sense, it makes sense for every OO team, and every solo for that matter, to look upon their numbers and evaluate them in the same way a fleetowner would. That exercise will give an OO a snapshot of how their operation is performing as a viable business.

At the end of the day, the fact that an OO team ends up placing the revenue from all the different aspects into one bank account is really irrelevant. All aspects should still be profitable, no matter where the money gets placed, or who it is supporting. In my view anyway, if a team is a same household team, it should not make a difference in each individual team member's revenue goals or viability.

While a married team may not 'need' to net as much profit or 'pay' as an unrelated team, that fact could be tucked away as an advantageous ability to stay afloat during a perhaps rougher time, as opposed to being a justification for ongoing lesser profitability than a fleet operation. Why should one driver's revenue expectations be lower just because of his/her marital status or the fact that they share living expenses? And why should an OO's expectations to earn enough revenue to support the ongoing operation of his business equipment be less than a fleet owner's expectations for doing the same? There really are 3 entities involved, if only on paper, and even if all 3 are really one family.

If an OO takes the time to figure out their numbers in the same way a fleet owner would, by breaking them down into the separate entities, interesting information may be discovered which an OO could then use to see potential problem areas and perhaps make business decisions which would correct them.

 

[TeamCaffee]

Pjjjj I agree with you 100% the columns and lines are the same in a fleet owners business as well as ours.

The fleet owner and us each must pay the drivers as well as set money back to replace the truck, maintain the truck, and expenses to keep the truck on the road.

The difference is the driver being the owner of the truck and having a vested interest in keeping the truck on the road and profitable.

I believe being the owner of the truck I can keep my expenses down more than a truck with a driver.

 

[ATeam]

pjjjjj and TeamCaffee, you are both right, but only to the extent that profitability is an objective. I know of fleet owners who run a fleet more to pass the time than to make money, and drivers of the same mindset. Some are in it for the money. Others are in it for the fun. Some try to be in it for both.

 

[TeamCaffee]

Some are in it for the money. Others are in it for the fun. Some try to be in it for both.

I think you can take the work TRY out of this sentence as I have met many people out here on the road who make a good living and have a blast doing it. They have figured out a balance that works for them and are able to obtain both goals have fun and run their butts of when needed.

 

[nightcreacher]

a flat rate was tried a few years back with some of the tractors,it didnt work,loads were still turned down.they put the trucks back on percentage.I think a straght truck at 1.30 / mile all in,loaded and empty,since their fuel mileage is much higher than a tractor could survive,but if you sit waiting for a load like you do when on percentage,you wont get enough miles to make it worth while

 

[Dreamer]

a flat rate was tried a few years back with some of the tractors,it didnt work,loads were still turned down.they put the trucks back on percentage.I think a straght truck at 1.30 / mile all in,loaded and empty,since their fuel mileage is much higher than a tractor could survive,but if you sit waiting for a load like you do when on percentage,you wont get enough miles to make it worth while

Steve,
From what I was told, the trucks in this fleet will be mostly pre-planned, using that 50% or so that is called ahead.. only if those loads are not available in the area they're going to will they be in line waiting. More of a traditional OTR dispatch model, as I'm sure you're getting used to again now.

Dale