What do you think an o/o or independent should PROFIT?

[allan5oh]

Hauling regular freight, dry van or deck freight.

IMO... a buck a mile for an o/o, independent even more(depending on circumstances of course).

[Rev.Vassago]

Hauling regular freight, dry van or deck freight.

IMO... a buck a mile for an o/o, independent even more(depending on circumstances of course).

:shock:

I'd have to average almost $3.00/mi to profit that much.

I'm wondering how exactly you manage or expect such a huge profit margin.

[no_worries]

Someone please explain profit...again.

[Rev.Vassago]

Someone please explain profit...again.

Profit = money left over after all expenses, including wages.

[NotSteve]

Yawn. Okay.

Fixed Expenses / Mo 9000/mo 9000/mo
Equipment per month per mile

Tractor $2553 $0.28
Licensing/Permits $155.31 $0.017
Federal Use $45.83 $0.005
Bobtail Insurance $82.29 $0.009
Collision/PD Insurance$226.58 $0.025
Liability Insurance $0 $0.000
Health care $451 $0.050
Worker Comp $0.00 $0.000
Retirement $0.00 $0.000
Ph/fax/internt/ldbds $220.99 $0.024
Office $20 $0.002
Tax/legal $10 $0.001
Software etc $0 $0.000
Salary $6000 $0.667
TOTAL FIXED $9765 $0.828


Variable Expenses / Mo 6mpg
Fuel @ $4.10/gal (/Taxes/Fees?) $6,150.00 $0.683
D/H Fuel (10%) $0.00 $0.000
Reefer service?? $0.000
Reefer fuel?? $0.00 $0.000
Taxes (road, use, fuel, fed) $26 $0.003
Food $400.00 $0.044
Truck Wash $100 $0.01
Servicing (P/M) $250 $0.027
Lrg Repairs(escrow) $300 $0.033
Tires(escrow) $122.00 $0.013
New truck(escrow) $0.00 $0.000

Total Variable $7348.00 $0.816
ROI (12% on $107K) $0.00 $0.00
TOTAL COSTS $17,113 $1.90

I'm curious. In your numbers you posted before which I listed above you don't have profit or ROI included which BigDiesel would say you don't know how to run a business???

[lowrange]

Hauling regular freight, dry van or deck freight.

IMO... a buck a mile for an o/o, independent even more(depending on circumstances of course).

I'll restate your original question another way: What do you think an o/o or independent SHOULD profit?

I don't know if it's your intention but let's say for a moment profit in this case includes driver pay. Is anyone besides Bandit's Cousin or anyone in a niche that just pays well above market rates, is anyone making a buck a mile? Don't most O/O barely make company drivers' pay?

That seems to be my case. I'm personally in the situation of considering a job change or a company job. It would be nice if everyone could get honest here a bit. Is anyone making, say, the equivalent of $70,000/yr NPBT?

[Rev.Vassago]

I'm curious. In your numbers you posted before which I listed above you don't have profit or ROI included which BigDiesel would say you don't know how to run a business???

I know you don't understand the concept of profit or ROI, but:

1. Profit is not an expense, and
2. ROI is the same thing as profit.

Now, if you could be so kind as to show me where I have any of my revenue listed on there, I'd be happy to calculate my ROI for you. I think you'll be hard pressed to find a line even on there for entering revenue, making the ROI line superfluous.

I do find it quite curious, however, that you have my expenses at such quick access. Sounds awfully obsessive.

[Rev.Vassago]

I don't know if it's your intention but let's say for a moment profit in this case includes driver pay.

The definition of profit usually doesn't, but okay. :wink:

Is anyone besides Bandit's Cousin or anyone in a niche that just pays well above market rates, is anyone making a buck a mile?

Niche areas may offer higher revenues per mile, but in most cases, the miles are a lot less, rendering that high rate per mile useless.

Don't most O/O barely make company drivers' pay?

Many don't even make that. I think you'd find that there are a lot of O/O's who neither understand the concept of profit, nor have ever turned a legitimate (by the definition) profit as an O/O. I think you'd find several on this board.

Is anyone making, say, the equivalent of $70,000/yr NPBT?

I'm sure there are. I'm also sure that they know they are, rather than "winging it" like many O/O's do, picking up the scraps after the truck-specific expenses are covered.

[lowrange]

Let's try this, then:

9,000 mile = $9000. $9000(12) = $118,000. Now this is profit, and you can choose the best definition, including or not including drivers' pay.

Seriously, I was hoping to be close to being out of debt by the end of the year. It seems I've made no progress these last four months and the truck just keeps putting demands on me. The latest, a tandem on my tractor, it looks like rubber was shaved off flattening them and making the ride bumpy, I don't know why. I MUST think about parking the truck.

Seriously, if I can't make the equivalent of $70,000 net before taxes, why am I incurring these risks? Why am I paying self employment taxes and health insurance (or should be paying health insurance)? I'm not trying to make this thread about me. I'll just watch the responses to making $118,000 profit after driver's pay, should be interesting. 8)

[GMAN]

There are few owner operators who will make $118,000/year. There are a couple of reasons why owner operators why they don't earn this much profit. Foremost are the rates. Rates are generally way too low to have this much profit for most owner operators. Another reason is that there are way too many owners who don't know how to run their business. Part of running a successful business is getting decent rates. Unless you run at fair rates you won't be profitable. Unless you can earn more than drivers wages, it isn't worth the effort or risk. When new owner operators start out it is difficult to know your operating costs. That is why it is critical to do your research. Most come to this board expecting a cookie cutter approach to calculating operating expenses. It doesn't work that way. Some get frustrated that we cannot give them exact operating costs. They don't understand that everyone has different costs, so everyone will have slightly different operating costs. Owners should have at least a 30% profit after all expenses (including drivers wages) are paid. I doubt most will have that much profit.

[GMAN]

I have owned several businesses over the years. A basic formula that I like to use when doing estimates is 1/3-Overhead or operating expenses (excluding wages), 1/3- Labor or wages, 1/3-profit. When you run for cheap rates you cannot use this formula. It won't work. If you spend 40% for fuel it skews everything else.

[rgarthman1969]

[quote="lowrange"]Let's try this, then:

9,000 mile = $9000. $9000(12) = $118,000. Now this is profit, and you can choose the best definition, including or not including drivers' pay.

You can make $118.000.00 at $1.00 a mile for running 118,000 miles. All you have to do is have someone else make your truck/trailer/insurance/taxes/etc/etc/etc/etc/etc/etc/etc/etc/etc. payments :wink:

[lowrange]

[quote="rgarthman1969"]

You can make $118.000.00 at $1.00 a mile for running 118,000 miles. All you have to do is have someone else make your truck/trailer/insurance/taxes/etc/etc/etc/etc/etc/etc/etc/etc/etc. payments :wink:

Stay on topic, the subject is profit.

Allan5oh is definitely no dummy, I'm hoping to hear a little 'splainiing.

And for everybody else, the question I have is this, considering self-employment taxes and no benefits, are you making more than you could as a company driver? Ok, if you are, you have risks, capital investment and a whole lot of work a company driver doesn't have. Are you making $20,000 more than you would as a company driver?

[rgarthman1969]

I know three drivers that are leased OO and they make less that Company Drivers. One has already broke his contract and the other two are going to ride it out. Well try that is. All three said that they wished that they would have had a lawyer look the contract before they signed. I do not know what the numbers are that they are making but they told me that they made more as company drivers. Sorry I cant offer any more info than this. BOL

[lowrange]

I know three drivers that are leased OO and they make less that Company Drivers. One has already broke his contract and the other two are going to ride it out. Well try that is. All three said that they wished that they would have had a lawyer look the contract before they signed. I do not know what the numbers are that they are making but they told me that they made more as company drivers. Sorry I cant offer any more info than this. BOL

That's plenty right there, rgarthman. I tell you what, I'm not going to limp along in my current condition. I'm going to get a better contract or I'm getting out. I can make what I need on company driver's wages. The big thing I have to avoid is one of these jobs where they're constantly pushing you to go, go, go, until some months later you absolutely hate your life and you quit your job just to see if you can get a life, again.

[Rev.Vassago]

I have owned several businesses over the years. A basic formula that I like to use when doing estimates is 1/3-Overhead or operating expenses (excluding wages), 1/3- Labor or wages, 1/3-profit. When you run for cheap rates you cannot use this formula. It won't work.

Well, that has you up at about a $3.50 - $4.00 per mile average, and paying yourself between $1.20-$1.30 per mile for wages. Sorry to say, GMAN, but I just don't see that happening. Your formula only works when fuel is cheap, which it isn't. As soon as one goes out of whack, the other two are thrown out the window. The formula is at the mercy of inflated expenses.

[no_worries]

At the end of the year, I would make more as a company driver. Partly because I can get some higher-paying driver jobs, mostly because I'd be running a lot harder. But most O/O's would do better FINANCIALLY in a company position.

I posted once, a breakdown of what you'd have to pay yourself as an O/O to equate making $.50/mile as a company driver. It's nearly $.60 if the miles are identical. That's just to make up the difference in bennies and employment taxes. Tack on all your operating costs and a little something for your risk (ROI) and you see why the situation is what it is.

[BigDiesel]

Hauling regular freight, dry van or deck freight.

IMO... a buck a mile for an o/o, independent even more(depending on circumstances of course).

What does your Messiah Kevin Rutherford say about this ????

[allan5oh]

I'd have to average almost $3.00/mi to profit that much.

You have expenses of $2.00 per mile? Are you self-employed or incorporated? If the first, driver wages shouldn't be included in the calculation.

Revenue - expenses = your wage = profit

I'm wondering how exactly you manage or expect such a huge profit margin.

I don't profit $1 a mile, but I think I should be. I'll never reach $1 mile under my current pay program. I'd have to switch companies.

[BigDiesel]

Trucker math at its finest.......