What Makes a Good Month?

[jimby82]

I'm sitting here looking over our numbers from last month, July 2012, and I started wondering, "Did we really have a good month?" I think we did, but I really only have our figures from previous months to compare.

So I'm wondering, "What IS a good month, anyway?" I guess there are several different to measure "good", but in this case, I'm talking strictly income. I know our numbers, but how do they compare to other trucks and carriers? Could we do better or are we doing well already?

We drive a "DR", White Glove, TVAL straight truck for FedEx Custom Critical. (22 ft. Box, lift gate, WG equipment, reefer) We have all our qualifications except DOD (haven't applied). We take loads to Canada, and far too often, into and out of NYC. We drive for a fleet owner. July was our 12th month of being out here on the road.

Since we don't pay for fuel, tolls, repairs or maintenance on the truck, (we as drivers are on the 40/60 plan.) It really makes little sense (in this context only) to include those in this discussion, since everyone's expenses and costs vary. The number I am looking at is monthly gross income to the truck.

I know everyone seems to get a little "freaky" when talking about actual income, so share if you want, or don't

So for this last July, we were home for 2 days, spent 5 days in SC at our nephew's Marine Corps graduation, and the truck was in the shop for maybe a day total. We sat over 2 weekends waiting for a Monday pickup. The rest of the month we were on the road.

We hauled a total of 16 loads, and had 2 dry runs. 12 of the 16 were WG loads, and 8 were refrigerated, none were TVAL (that's another story). 2 were Hazmat and only 1 Canadian. We were only west of the Mississippi for 1 load.

We ran 12,636 "authorized "miles (13,233 actual). For the month, our truck grossed $22,223.21. (I'll save you the trouble, that's $1.76 mile / all authorized miles, $1.68 mile/ all actual miles).

So how did we do? We exceeded our goal for the month ($20,000 gross), but we've had better months. Do we need to raise our goal? Any thoughts? How would you define a good month?

 

[Monty]

Jim, after a year in the business, seems you have a handle on it ..... if you made YOUR goal, then welll done!

As for, "is it enough" ... it's never enough. Always strive for more, as you did above. There will be lean months, and exceptional ones also. I always ask folks to average their income over 3 months, then see how you are doing weekly.

Weekly concerns seldom ever show you the big picture.

 

[OntarioVanMan]

Jimby...its a tough question because you aren't a normal expediter...LOL

I mean Tval/WG and all...two different customer types....different freight...

so you want to know how a regular dry freight truck did in July?

I've seen this so many times....people start to question if they are where they should be during a slow period..a slow month or even slow quarter does not always equate to a slow year....If you have no other issues and you are happy with your fleet owner...you should ride out this downturn. IMO

 

[layoutshooter]

That is a real 'solid' month. Not great, but FAR from bad. We would NEVER complain about a month in that range. That $1.76 per mile is low though. Not sure why your loaded miles are paying in that range. That number should be over $2 for a TVAL truck. Must be because you worked less temp loads than normal. That can be pure luck.

 

[OntarioVanMan]

That is a real 'solid' month. Not great, but FAR from bad. We would NEVER complain about a month in that range. That $1.76 per mile is low though. Not sure why your loaded miles are paying in that range. That number should be over $2 for a TVAL truck. Must be because you worked less temp loads than normal. That can be pure luck.

He did say half his loads were not refridgerated...so would that not knock his income down a bit?

 

[layoutshooter]

He did say half his loads were not refridgerated...so would that not knock his income down a bit?

That very well could do it. I would NEVER sneeze at a month like that. It is, like I said, SOLID. No where near bad. Multiply $22K times 10 and you have a GREAT year!

 

[ATeam]

First of all, a good month is one in which you begin it healthy and safe and end it the same way.

You do a good job of detailing many of the variables that apply and explaining why it is difficult to make apples-to-apples comparisons among expediters, even if they run with the same carrier.

At Landstar, I have met BCO's (contractors) who consider any month in which they gross over $10,000 to be a good month. I know of a team that works a few months a year and spends the rest of their time camping in their RV. For them, four months that produce the money they need to live on for the year would be a good four months. Three months that produced the same amount of money would be even better. Two months would be fantastic, but in every case the target amount remains the same for them.

When we were at FedEx Custom Critical, we came to consider a month over $20,000 gross to be a good month. That thinking took root and carried over to Landstar where we are now. But there is a problem. Expenses have soared in the time we have been in the business so the profits have declined. Earlier, we were able to easily and quickly pay off our new truck when grossing $20,000 and more a month. Today, that would not be possible. You can still gross the $20,000 but the money does not go as far as it once did.

Monthly gross revenue figures are helpful indicators in some respects. But they can be very misleading too, and even fatally so. If an expediter team tells themselves they had a good month because they grossed over $20,000, and had a good year because they were able to take some time off and still grossed over $200,000, they may miss the fact that declining revenue per mile and increasing expenses (including personal expenses) are putting the squeeze on.

It's OK to ask, how much did we gross this month? It's better to ask, how much did we keep? If all expediters asked the second question and looked hard to find the answer, many of them would find themselves grossing $20,000 a month while joining the ranks of the working poor and doing little or nothing to provide for a financially secure retirement.

It feels great to say "We grossed over $20,000 this month." But look harder. For who else was your month a good month? How much of that $20,000 did you pay to the oil companies? How much did you donate to the state in the form of tolls and other taxes? How much was given up to the declining value of your truck? What tire dealer's son got a contribution to his college fund out of the $20,000 you produced? How much of that $20,000 does your fleet owner get to take home and use to buy rounds of drinks at the clubhouse? Which truck mechanic gets to make the Snap-On man happy with some of the $20,000 you grossed? How much of that $20,000 goes back to your carrier in the form of Qualcomm and other fees? How much of that $20,000 was pocketed by insurance companies?

We put ourselves at risk on the highway and work a full month of our lives to produce $20,000 gross. But when you think about it, you see that you are working hard to give most of that $20,000 to other people and entities.

Feel good about your monthly gross if you wish but pay attention to your net. Otherwise you may find yourself "Working for the man every night and day."

Don't work for the man. Work for yourself. The man likes it when you focus on your gross. Expediters need to focus on their net.

 

[Moot]

Feel good about your monthly gross if you wish but pay attention to your net.
.
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Expediters need to focus on their net.

Excellent advice!

 

[Moot]

The man likes it when you focus on your gross.

As does the IRS.

 

[ChanceMaster]

Your post also reminds me of folks who brag about the number of miles they run without focusing on the revenue aspects of those miles.

Sent from my PC36100 using EO Forums

 

[layoutshooter]

I though that this was a very good post. It is a rather new to expediting team attempting to gauge their performance. They are on the right track with questions like this.

 

[skyraider]

I do not know the straight truck part of the world, but if it compares to a cv, you might get half of the gross for you to keep,maybe.

 

[jjoerger]

Sounds like a solid month to me.
Our June numbers were @ $25000 for 15000 total miles.
Only did 6 runs.
Took most of July off.

Sent from my PG06100 using EO Forums

 

[zanico]

I agree with Phil. As a prospective expediter, and reading this site, no one ever says anything about their net, only the gross, and the gross is hard to get from people. It doesn't matter what your gross is if there is nothing left after the expenses are paid. I know it's "taboo" to talk money. For someone who is researching this field, the bottom line is, can I make enough money for me. I know "enough" depends on the individual. But some numbers would help a "wannbe" with his/her decision.

 

[scottm4211]

The net can be just as misleading depending on the overhead/expenses of the OO.

 

[zanico]

The net can be just as misleading depending on the overhead/expenses of the OO.

This is true. I also know it will be different with CV, Sprinter, and ST. I just think it would be nice to see some real numbers if anyone is willing to give them.

 

[jimby82]

Some great responses so far! I hope to comment more once we are finished here in the shop (having the starter and ignition switch replaced). This phone app is good for viewing, but not so great for typing

As a team (husband and wife) on the 40/60 plan, we together take home approximately 33% of the gross revenue to the truck each month. (In last month's example, about $7250. There is some variation in this from month to month (smaller than 1/2%) due to if loads involve labor or secure services. We are paid 100% of these services rather than the usual 40%. They don't make too big a difference in the overall net, but they do add up over time.

That 33% is gross to us. We pay occupational insurance out of that, and eventually taxes on our profits after expenses. No truck or fuel expenses.

% of gross take home would of course vary for those on a 60/40 plan and for a true owner operators. I would suspect the % would be greater in both cases.

 

[layoutshooter]

Here you go Jim, the best of both worlds. REAL per mile numbers without REAL totals.

YTD

$2.59 for all loaded miles

$1.99 for over all miles.


Hope that helps you.

 

[Steady Eddie]

Some great responses so far! I hope to comment more once we are finished here in the shop (having the starter and ignition switch replaced). This phone app is good for viewing, but not so great for typing

As a team (husband and wife) on the 40/60 plan, we together take home approximately 33% of the gross revenue to the truck each month. (In last month's example, about $7250. There is some variation in this from month to month (smaller than 1/2%) due to if loads involve labor or secure services. We are paid 100% of these services rather than the usual 40%. They don't make too big a difference in the overall net, but they do add up over time.

That 33% is gross to us. We pay occupational insurance out of that, and eventually taxes on our profits after expenses. No truck or fuel expenses.

% of gross take home would of course vary for those on a 60/40 plan and for a true owner operators. I would suspect the % would be greater in both cases.

Just think, If you owned that truck, you would be right where you are now! 33.33% to you and wife, 33.33% to truck, and 33.33% to maint. fund. Why not take that 33.33% and live free...... Good move!

 

[beachbum]

Your net is after overhead and expenses.

The net can be just as misleading depending on the overhead/expenses of the OO.