Per mile vs percentage
- Thread starter unvme2
- Start date
I personally like the per miles better. Both are ok but the percentage requires more leg work. If paid on percentage, you must see the BOL and surcharges to know if you are getting the correct amount. I wouldn't under any circumstances,"just take the companies word for it" Three years ago we had trucks leased to a nameless company and we found out through one of their customers, that we were getting screwed. They even had the nerve to argue about it until proof was shown.
Always demand the BOL to know what you are really being paid. If they are too busy or refuse, leave and go to another company.
Davekc
owner
20 years
Always demand the BOL to know what you are really being paid. If they are too busy or refuse, leave and go to another company.
Davekc
owner
20 years
Dave and I disagree on this issue 'cause I prefer the percentage method that FedEx Custom Critical utilizes. As the customers tariff increases, so does our share. We are not locked onto a fixed pay per mile no matter what the customer is charged. I don't disagree with Dave about the checking of the Customers BOL. We have seen many dozens of BOL's over the years and have never had to dispute the percentage computation. I believe our carrier's reputation speaks for itself and that checking every BOL with them and, perhaps, other reputable carriers is not necessary.
A deeper issue though is what difference does it really make if you are happy with the cents per mile average you enjoy at the end of the year. I took many loads that paid less than those major carriers that pay per mile and, I took many more loads that paid considerably more. At the end of the 2004 calendar year my average per revenue mile, with fuel surcharge, was $1.19. With many of the carriers paying $.75, .77, or .80, who's better off?
Terry
A deeper issue though is what difference does it really make if you are happy with the cents per mile average you enjoy at the end of the year. I took many loads that paid less than those major carriers that pay per mile and, I took many more loads that paid considerably more. At the end of the 2004 calendar year my average per revenue mile, with fuel surcharge, was $1.19. With many of the carriers paying $.75, .77, or .80, who's better off?
Terry
I believe you can make more on a percentage basis however you have to know what you are doing and work the system properly. For someone like Terry it works well because he's got the experience and intelligence to make it work to his advantage. He's also with a company that is extremely unlikely to screw the contractor unless by accident.
There is also something to be said for the consistency of a per mile system. It may not total as much at year end but it's a given and much easier to audit than a percentage system.
I also believe the difference Terry points out is as significant as it is because it's in a van. I think in a C or D unit it wouldn't be as great, maybe 10-15% instead of 25-30%, but that's just my gut feeling. I could be wrong on that.
I'll shut up after repeating something I said in another thread. If the prospective percentage basis carrier doesn't immediately respond yes when asked if they will provide copies of BOL's and invoices upon request then don't just walk away but run. My .02, YMMV.
Leo
truck 4958
Support the entire Constitution, not just the parts you like.
There is also something to be said for the consistency of a per mile system. It may not total as much at year end but it's a given and much easier to audit than a percentage system.
I also believe the difference Terry points out is as significant as it is because it's in a van. I think in a C or D unit it wouldn't be as great, maybe 10-15% instead of 25-30%, but that's just my gut feeling. I could be wrong on that.
I'll shut up after repeating something I said in another thread. If the prospective percentage basis carrier doesn't immediately respond yes when asked if they will provide copies of BOL's and invoices upon request then don't just walk away but run. My .02, YMMV.
Leo
truck 4958
Support the entire Constitution, not just the parts you like.
At the end of the 2004 calendar year my average per revenue mile, with fuel surcharge, was $1.19. With many of the carriers paying $.75, .77, or .80, who's better off?
Terry
I am not sure with the vans as much, but when looking at load boards and bids, LDB is right on in that freight is moving at very simular rates with regards to straight trucks and LTL loads
The .75,.77 ect is only a base rate. I am sure they don't include fuel surcharge, deadhead, or empty mile moves.
FedEx for example on deadhead, pays after the first 100 miles while others are at 50.
Alot of factors to consider. Sadly, it was what we thought at the time a reputable company that we encountered some problems.
One of those be careful scenerios.
Davekc
Terry
I am not sure with the vans as much, but when looking at load boards and bids, LDB is right on in that freight is moving at very simular rates with regards to straight trucks and LTL loads
The .75,.77 ect is only a base rate. I am sure they don't include fuel surcharge, deadhead, or empty mile moves.
FedEx for example on deadhead, pays after the first 100 miles while others are at 50.
Alot of factors to consider. Sadly, it was what we thought at the time a reputable company that we encountered some problems.
One of those be careful scenerios.
Davekc
The big advantage on the flat paid miles rate is when your carrier gives a customer a large discount they eat the discount instead of you. Having said that I prefer the percentage vs per mile due to additional charges that may incur,such as inside delivery/pickups etc. In my years with my carrier I have only had one trip that did not match up to what was charged,called about it and it was corrected. However I am using their pay sheet to check on what was billed to the customer and I feel it is believable as if it was not their credibility would go down the tube real fast and their reputation would be similar to the Ft Wayne outfit that we hear about.