paullud
Veteran Expediter
The average miles per shift wouldn't come into play in this decision. You would look at the revenue per mile and where the load delivers to see if it is a good area.
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Miles
- Thread starter spongebox1
- Start date
The average miles per shift wouldn't come into play in this decision. You would look at the revenue per mile and where the load delivers to see if it is a good area.
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I would tell them to consult the magic 8 ball. What you don't have one? well you've come to the right place for the low price of $19.95 you can have A magic 8 ball specially designed for truckers just ask the question then shake the magic 8 ball and turn it upside to see the answer. Get your credit card out and order NOW! but wait there's more for the first 10 callers we will throw in the amazing Ginsu by Ronco. I'd give them away but my wife won't let me.
Thanks for your support
Thanks for your support
pandora2112
Seasoned Expediter
It's going to depend on previous experience according to your hypothetical question the pays a total of 220 dollars or 27.50...going off just 400 miles. Now if previous experience tells you, you're going to have to occur extra expenses after the run to deadhead to a good freight area or spend 24 hours waiting then is it really a profit of 220 or 27.50 an hour.
Again it's hypothetical and more about what your previous experience tells you about certain areas, extra time a run may require because of known factors like a coming blizzard or traffic. You can't forsee every factor all the time.
But for arguments sake let's say you had this run and another offer that only pays 200 in profit for 8 hours work or 25.00 bucks but the freight area of the delivery is better, than the run making 220 or 27.50 so instead of sitting idle for 10 hours you get right out on another run in 2 hours? This run is making you 295.00 in 10 hours...now instead of making 220, then sitting 10 hours you've make 495.00 in 20 hours? You have to weight all options...if you are sitting you may not be occurring expenses but you're also not making profit. I'm trying to look at all sides, making 5 cents profit after expenses is not doing anyone any good but without considering the freight area you're going to, downtime occurred for truck maintenance or personal care (bc let's face spent away from home is work, this isn't a 9-5 come home to the wife and kids gig), etc than you may find that while you are making a profit of 65 cents a mile your time away from home, waiting on load is making that 65 cent profit more like 45. I'm not saying take cheap freight, but I am saying sometimes you end up with 55 cents a mile profit on a run but position yourself for more potential profits...it doesn't always work in your favor, sometimes the 400 miles at 1.80 is more all the way around but sometimes when looking at how long a rum will tie up with waiting on a load, etc it is more profitable to 1.75 a mile.
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Again it's hypothetical and more about what your previous experience tells you about certain areas, extra time a run may require because of known factors like a coming blizzard or traffic. You can't forsee every factor all the time.
But for arguments sake let's say you had this run and another offer that only pays 200 in profit for 8 hours work or 25.00 bucks but the freight area of the delivery is better, than the run making 220 or 27.50 so instead of sitting idle for 10 hours you get right out on another run in 2 hours? This run is making you 295.00 in 10 hours...now instead of making 220, then sitting 10 hours you've make 495.00 in 20 hours? You have to weight all options...if you are sitting you may not be occurring expenses but you're also not making profit. I'm trying to look at all sides, making 5 cents profit after expenses is not doing anyone any good but without considering the freight area you're going to, downtime occurred for truck maintenance or personal care (bc let's face spent away from home is work, this isn't a 9-5 come home to the wife and kids gig), etc than you may find that while you are making a profit of 65 cents a mile your time away from home, waiting on load is making that 65 cent profit more like 45. I'm not saying take cheap freight, but I am saying sometimes you end up with 55 cents a mile profit on a run but position yourself for more potential profits...it doesn't always work in your favor, sometimes the 400 miles at 1.80 is more all the way around but sometimes when looking at how long a rum will tie up with waiting on a load, etc it is more profitable to 1.75 a mile.
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pandora2112
Seasoned Expediter
But shouldn't your average mile per shift come into play? If you average 50 miles per hour it takes 10 hours to go 500 miles but if I average 70 miles per hour I go 500 miles in just about 7 hours! Leaving me 3 hours to make more money, take a nap or whatever. Not to mention I've now not had to waste a half hour on my mandatory break! So it's now taken you 10 1/2 hours and me say 7.25 hours...again it's just another factor to consider. If we are both paid the same and our expenses are the same who made more in less time?
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paullud
Veteran Expediter
If you have a big difference in average speed between team members it is most likely because of the difference between night and day driving or one drives much faster than the other. The first one is just dealing with traffic, etc and calculated into your average dispatch speed. The second one is just a speed adjustment based on when the load needs to be there. Both are just factors into how fast and far you can move as a team not individually. If you had 2 drivers running the same load for the exact same pay and one does it faster than the other the one that does it faster likely made less because they drove faster and got worse MPG.
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In that scenario, if I was the one going 500 miles in 10 hours, there is no question; I am the one who made more money for three reasons. (1) You burned more fuel to drive the same amount of miles. Your higher expenses mean I made more money on the run. (2) I don't need to be out of the truck to manage sleep time or enhance my productivity and quality of life. (3) Pay per hour is an irrelevant number in expediting.
You can convert run pay into pay per hour all you wish, but when real-world money people ask an expediter to show profits and losses, it is done with an income statement, not with pay-per-hour numbers that can be manipulated to say anything you wish.
So to answer your question; no, absolutely not. Average miles per shift should not come into play.
I woke up this morning thinking about this thread and the "average miles per shift" indicator that has been proposed. The reason I am so enthusiastic in my critique of this indicator is that I do not want expediter newbies and wannabees getting the idea that pay-per-hour is a meaningful way to evaluate your true revenue in this business; and I especially don't want new people thinking that if they become expediters they will be out here making $17 - $23 an hour as has been suggested in posts above.
Expediters do not get paid by the hour. Profitability in this business is measured by subtracting your total expenses from your total revenue. It is not measured by pay-per-hour. It is measured by the amount of money you have left over (or lost) in a given and meaningful time period.
Revenue and expenses are measured both by the mile and by the day. Expediters who know their numbers know how much it costs to drive per mile and they know how much it costs to operate per day (sitting and moving).
You cannot rely on your revenue per mile alone to tell you how you are doing in this business. Nor can you rely on your revenue per day. You have to consider both together, and even doing that will not give you a good picture unless it is over a meaningful period of time like a month or even a year.
The problem with the "average miles per shift" indicator and the pay-per-hour conclusion it supposedly supports is that it overlooks your operating costs per day.
More to follow by way of specific examples. Gotta run now.
Expediters do not get paid by the hour. Profitability in this business is measured by subtracting your total expenses from your total revenue. It is not measured by pay-per-hour. It is measured by the amount of money you have left over (or lost) in a given and meaningful time period.
Revenue and expenses are measured both by the mile and by the day. Expediters who know their numbers know how much it costs to drive per mile and they know how much it costs to operate per day (sitting and moving).
You cannot rely on your revenue per mile alone to tell you how you are doing in this business. Nor can you rely on your revenue per day. You have to consider both together, and even doing that will not give you a good picture unless it is over a meaningful period of time like a month or even a year.
The problem with the "average miles per shift" indicator and the pay-per-hour conclusion it supposedly supports is that it overlooks your operating costs per day.
More to follow by way of specific examples. Gotta run now.
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pandora2112
Seasoned Expediter
And I'm not saying use this method to calculate your income but use it as an extra tool to look at things from a different angle.
Like my real life example. We have taken this same run 5 times, the broker had this run every Monday. It's never ready at our appointment time, we have to wait up to 4 hours for it to be ready. We have to deadhead about 3-4 hours away from delivery to be in good freight area and it's still occasionally a wait. We get to the new freight area at 10pm so we are there until morning. Once winter hits our drive time will be extended because this is a heavy snow storm area. So since I have first hand knowledge of this run and all it's factors I can use more than one way to look at this run. Yes it pays well but how much time am I wrapping up in this run, that accounts for my profitability. If I look at my costs and calculate my profits into hourly wages I'm not hurting my ability to cover expenses but I'm giving myself another way to look at my profits.
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Like my real life example. We have taken this same run 5 times, the broker had this run every Monday. It's never ready at our appointment time, we have to wait up to 4 hours for it to be ready. We have to deadhead about 3-4 hours away from delivery to be in good freight area and it's still occasionally a wait. We get to the new freight area at 10pm so we are there until morning. Once winter hits our drive time will be extended because this is a heavy snow storm area. So since I have first hand knowledge of this run and all it's factors I can use more than one way to look at this run. Yes it pays well but how much time am I wrapping up in this run, that accounts for my profitability. If I look at my costs and calculate my profits into hourly wages I'm not hurting my ability to cover expenses but I'm giving myself another way to look at my profits.
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Well stated.
We do the same in this truck. Any tools available to look at the business we use them. I want to know how much an hour we are making and use the information like you. Just one piece of the puzzle to obtain great profit.
As with your stated run above, we have a few runs that we keep detailed notes on. We want to make sure we remember the extra time/effort involved with the un- typical runs.
As to the OP's question.... we do 550-650 +/-
If we run west to east, east west, it's usually 44 hours straight then sleep the night before delivery in a stopped truck.
You may be giving yourself another way to look at your profits, but it is not a way that bankers, the IRS and other money people use to measure the actual financial success of a business.
More to follow.
pandora2112
Seasoned Expediter
No but as someone who owned a business before I know turning a profit on 100 hours that equates to 4 bucks an hour profit paid to me is bad business! If I'm going to put in the hours and make what equates to minimum wage I'll go be a door greeter.
I've worked on commission, owned my own business before this and profit is one thing but making a living wage is entirely another! You have to look all factors to truly measure success...if I work 40 hours a week and make 100,000 a year and you work 65 hours a week and make a 100,000 who's making a better profit on their time?
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In the scenario you present, the profit is exactly the same. You paid zero for your time and I paid zero for mine. There were no other expenses mentioned. Each of us used our time to make $100,000, producing a net gain of $100,000.
Profits are not measured in time. They are measured in dollars.
Hourly rate is typically used for local delivery and should be factored if running into a metro area like N.Y.C.
I think what Pandora is trying to say is and please correct me if I am wrong. This business is really all about the numbers.
When it comes to miles per shift, miles typically = work completed. So yeah, if I average 700 miles per day but get paid the same amount as the guy averaging 500 miles per day in an 11 hour day. Yes, I should be offered a better rate because I get the work done rather than intercourse the K9.
Take 2 drivers fresh 11 / 14 hours available same day, and driving conditions both loaded and leave at the same time to Buffalo NY to Richmond VA that should take 10 1/2 hrs or so legal . Driver 1 gets it there and delivered in a single shift but takes driver 2 an extra 2 hours, on top of having to shut down for his 11 off.
Sure driver 1 deserves a better rate per mile.
If I were a team driver I would expect my co driver to average the same or close to it considering I have to share the pay with him/her.
Bob Wolf.
I think what Pandora is trying to say is and please correct me if I am wrong. This business is really all about the numbers.
When it comes to miles per shift, miles typically = work completed. So yeah, if I average 700 miles per day but get paid the same amount as the guy averaging 500 miles per day in an 11 hour day. Yes, I should be offered a better rate because I get the work done rather than intercourse the K9.
Take 2 drivers fresh 11 / 14 hours available same day, and driving conditions both loaded and leave at the same time to Buffalo NY to Richmond VA that should take 10 1/2 hrs or so legal . Driver 1 gets it there and delivered in a single shift but takes driver 2 an extra 2 hours, on top of having to shut down for his 11 off.
Sure driver 1 deserves a better rate per mile.
If I were a team driver I would expect my co driver to average the same or close to it considering I have to share the pay with him/her.
Bob Wolf.
pandora2112
Seasoned Expediter
So your time is not a commodity? I value my time...
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A person's time is a commodity that can be bought and sold. In my case, I have FAR less time available to me than I did at 25. THEREFOR, since my time is a rare, and getting more rare with each passing minute, it is worth FAR more than it used to be. At the rate it's going, it will not be long before no one will be able to afford me. That is when I become priceless!
No. My time is not a commodity. I can sell a commodity; something like gasoline or corn for example. But I cannot sell my time. And no one else can either.
If you approached someone and said, "Hey, friend, I have a couple of hours to sell you," how would you price those hours? How would you deliver them? Your friend and you begin your day with 24 hours. There is no way for you to sell him two so his day will be 26 hours and yours will be 22. Time cannot be bought and sold. Therefore it is not a commodity.
Time is a resource and an asset, but it is not a commodity.
Years ago I was a professional who billed by the hour but when I wrote up the bill, I did not charge for the time. I charged for the services provided in the billed amount of time.
The bill did not read "1 Hour." It would read something like "Financial Planning Consultation, 1 Hour." I was not in business to sell time. I was in business to sell my services. The services were quantified by time and billed at a per-hour rate, but it was the services that were sold, not the time.
So too for an hourly employee that makes say $20 an hour, 40 hours a week. That person does not arrive at work and get paid to do nothing. He or she does not get paid to give up one's time. The person gets paid to do whatever work the employer is paying that worker to do. The worker does not sell his or her time for $20 per hour. It is labor that is sold at the rate of $20 per hour.
Fuel is sold at $x per gallon; hamburger at $x per pound, consulting services and labor are sold at $x per hour, transportation is sold at $x per mile. But as for time, it not sold at all because there is no way to do so.
You can measure an hour of time but you cannot sell it. An hour of labor can be sold.
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zorry
Veteran Expediter
Phil, say you were still at Fed.
I'm on a secure load and you park next to me.
I may say "Phil, my books a little tight, I know you don't load til day after tomorrow. Would you guard my load while I take a much needed break ?"
Sitting in your seat, looking at my truck shouldn't be a high paying job. Your time, lost log book hours, is worth much more.
If I took an 8 hr break, while you secured my load, you in effect have sold me 8 hrs of time.
I'm on a secure load and you park next to me.
I may say "Phil, my books a little tight, I know you don't load til day after tomorrow. Would you guard my load while I take a much needed break ?"
Sitting in your seat, looking at my truck shouldn't be a high paying job. Your time, lost log book hours, is worth much more.
If I took an 8 hr break, while you secured my load, you in effect have sold me 8 hrs of time.
paullud
Veteran Expediter
The high rate per mile equals a better rate per hour. Of course there could be hold ups at the shipper or receiver but detention pay helps there.
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