It's a Team's Life
To Each Their Own
A business’s goal is to make money and not all of us follow the same path to reach the end. To figure success or failure is to know how much money you keep at the end of the year. This is where the goal can get tricky as my idea of how much money I kept at the end of the year might not match your idea. Since I am not an accountant my profit and loss statement is pretty simple. How much did we spend, how much do we owe, and after paying all bills what is left is our profit.
Over the years I have talked to many different business owners and how they figure a profitable load. What I find fascinating is that the people I talk to that complain the most about not making a profit or the ones that are quickest to scoff at different ideas, or they say they won’t do something. During this pandemic, many of us have changed our thinking about the old ways of doing business.
Some drivers do not care about pay per mile they are more concerned with pay per day. These people know how much they need to make or average by the week or the month. The people that average by the month seem to be less stressed than those that worry about profit per individual day or week. This way of figuring profit seems to bother many people the most that only look at the rate per mile. Many that figure loads this way are unbelievably profitable and stay moving but often have a lot of deadhead.
Other business owners are concerned with a rate per mile and will not move unless the rate reaches a certain number, this idea seems to be found the most with fleet owners. Those drivers seem to sit more than those who use a rate per day to accept loads. Trucks that are leased to a percentage-based company deal with this situation on every load. In my mind, the problem with only using a set rate per mile (RPM) method can get you into a bind by accepting short loads that pay great per mile but not that great overall. For example, when accepting a load that pays $100 and is ten miles this looks great per mile, but if the load picks up in the afternoon or if a solo the load will start their clock. Taking a good-paying short load in the afternoon might do you out of getting a longer or better load. For a team, it works out to take a short load early in the morning so that in the afternoon when many loads come out you are again available for a load. For a solo, those high paying short loads can ruin their hours for the day.
Many owner-operators use a combination of these two scenarios day pay as well as rate per mile. Not every load is perfect but knowing what you need to make each day out on the road will make decisions easier on which load will make you a profit.
Keep your mind open to new ideas as you never know the idea might be what makes you several thousand more dollars a year.
Bob & Linda Caffee
TeamCaffee
Saint Louis MO
Expediters since January 2005
Expediting isn't just trucking, it's a lifestyle;
Expediting isn't just a lifestyle, it's an adventure;
Expediting isn't just an adventure, it's a job;
Expediting isn't just a job, it's a business.