I know it was a while ago, but last March at MATS 2008 Getloaded.com's own Director of Product Development, Eddie Peloke, became famous....well kind of; regardless I wanted to share it with all of you. Check out the video below. It's an exerpt from "The World of Trucks" and Eddie is the star!
Gotta love it!
Wednesday, September 24, 2008
Monday, September 8, 2008
Knowing Your Costs
Within the transportation industry, as with all other industries, maximizing your profit is a very important factor. But you might be asking yourself...how do I figure out the cost per mile to move my truck, how much do I ask for when bidding on a load and how do I ensure I will make money?
First off, you want to start by knowing how many miles per gallon your truck uses when it's fully loaded. After that you would add up all the additional costs that are involved in running your business. Don't forget to account for your truck payment, trailer payment or lease fee, insurance payment, driver wages, business taxes, fuel taxes, IRP fees, overhead (if you rent an office, have a dispatcher etc), load board membership fee’s, association membership fees, truck maintenance and anything else related to your trucking company that costs you money.
Once you have this data you can really see what your cost is per mile. To calculate this take all of your costs per year and add them up. Then add up your total average miles per year or the miles you anticipate driving. After that you will divide the miles per year by your cost per year. This will tell you how much you MUST make per mile to cover your costs.
The second part of this is to see what your average fuel cost is per mile. To do this you divide the price of fuel by your trucks' miles per gallon. Since the price of fuel fluctuates you should recalculate this figure each time you bid on a load. You can either add this to your cost per mile or ask for it separately as a "fuel surcharge".
Lastly, don’t forget, when you make a bid on a load, you will want to bid HIGHER than your cost per mile plus your fuel cost. Doing this will help ensure profit on each load!
Hopefully by knowing your true costs you will be able to better negotiate the bids on your loads.
As always thanks for stopping by and keep 'em loaded!
Best,
GLA
First off, you want to start by knowing how many miles per gallon your truck uses when it's fully loaded. After that you would add up all the additional costs that are involved in running your business. Don't forget to account for your truck payment, trailer payment or lease fee, insurance payment, driver wages, business taxes, fuel taxes, IRP fees, overhead (if you rent an office, have a dispatcher etc), load board membership fee’s, association membership fees, truck maintenance and anything else related to your trucking company that costs you money.
Once you have this data you can really see what your cost is per mile. To calculate this take all of your costs per year and add them up. Then add up your total average miles per year or the miles you anticipate driving. After that you will divide the miles per year by your cost per year. This will tell you how much you MUST make per mile to cover your costs.
The second part of this is to see what your average fuel cost is per mile. To do this you divide the price of fuel by your trucks' miles per gallon. Since the price of fuel fluctuates you should recalculate this figure each time you bid on a load. You can either add this to your cost per mile or ask for it separately as a "fuel surcharge".
Lastly, don’t forget, when you make a bid on a load, you will want to bid HIGHER than your cost per mile plus your fuel cost. Doing this will help ensure profit on each load!
Hopefully by knowing your true costs you will be able to better negotiate the bids on your loads.
As always thanks for stopping by and keep 'em loaded!
Best,
GLA
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