What's really best percentage or miles?

[matcat]

That sounds like a lot of money for a mileage carrier.

I would of never believed it myself if I had not seen the paperwork. He was getting .96cpm for all miles moved, but lately they cut him down to 92cpm and with no students to train he hasn't been moving much at all. He also did a lot of hazmat when not training (Unless he had a student with hazmat end).

[Heavy Duty]

Silly LOADIT. How does it feel to be wrong? If an o/o did that he could gross over 300K in a year, even with a crappy backhaul on a 50 week running year. And we all know that's imposible. Please quit lying to people on CAD

I know quite a few trucks that run over 300k a year. Some have done quite a bit more. Now if they were smart enough to put their own name on the door and quit leasing to a carrier.

[BanditsCousin]

If I could get my hands on the freight I haul on my own, I most surely would.

And I don't have a scanner in the truck and my 1099's are at home. Someone once said they can guarantee I didn't turn 300K last year (let alone the 327K I grossed). I'm just waiting until the wager is there like I originally offered. Other than that, naysayers can call B.S. and we'll all move on.

But I can guarantee I won't break 300K this year, thats a certainty.

[allan5oh]

I honestly don't really care what anyone grosses. It's what you keep that matters.

[BanditsCousin]

Very good point. My first 1099 was for 35K and change. However, I had loading, unloading, packing and a few shuttle truck rentals I had to deduct, and that knocks down your net real quick.

Gross is only really relevant when you compare 2 similar o/o's side by side, and no 2 will have the same expenses, and no 2 will operate identically to the other.

[GMAN]

I think it depends on what you are comparing, BanditsCousin. If you are comparing total revenue then gross may be a good way to compare two different operations. If you are looking at the more successful or profitable then net is more important.

[BanditsCousin]

Agreed. The 2 similar operations I was mostly referring to would be like 2 trucks smilarly specc'd leased to the same company.

But, you and Allan are right about the net/bring home deal.

But to get on track about the % or mileage, it's really what is "value added" in a leasing contract. Tolls, scales, plaets, ins., etc. that are paid for do add a value to the mileage pay. A lot of the time, that value isn't greater than running under percentage...but there are cases when it is. I can't recall of any, but there's always an exception.

[GMAN]

Some of the large carriers offer a cost plus pricing at TA for fuel. That can save a considerable sum over the course of a year. Savings can be $0.20/gallon or more with some carriers. That also has value. I know Landstar and some of the other major carriers offer the cost plus program. Not all carriers pass all of the savings along to their owner operators.

Most carriers who pay for base plates, tolls, etc., are lower mileage carriers. If you consider the cost of those things and the earnings differential of percentage pay, the percentage rate still tends to be higher in most cases.

Some of the benefits that some pay such as base plates can add about $0.016/mile to your bottom line based upon a base plate cost of $1,600 and running 100,000 miles during the course of the year. You need to look at the entire picture.

[Fredog]

I honestly don't really care what anyone grosses. It's what you keep that matters.

only what I keep matters to me, I dont care what anyone else makes or claims to make

[LOAD IT]

Bandit, I have to side with Rev about your $300K yearly revenue until you prove it. Rev once posted his Tax forms to make his point,....so why dont you? I really hope that you did make $300K, but I think we all would like to see it. Also the scenario I posted, 1 truck could not do 1 load per week, because one load would take 4 to 7 days depending on the driver and the stops, etc. As you already know.

We have gotten off topic from what the original poster wanted to know. I dont really care if Bandit made $300K with one truck (which would have to be gross). But this forum is here to disperse good information and not trucker BS. I dont think he grossed $300K and I dont think a trainer grossed $272K running 96 cpm linehaul. So newbs, there is money to be made in trucking but you wont be making those numbers with 1 truck and what is important is how much PROFIT you made and in a business of cents per mile profit, you have to be very conscious of what is PROFITABLE, not just loads, but your actions also. I had a o/o turn down a load last Friday, 12 miles paying $600 because he wanted to be out that weekend. He wasnt thinking about PROFIT. The next o/o in line was very pleased.

[GMAN]

Gross revenue has little to do with profit. Some get confused over revenue and profits. You can gross $200,000 in a year and lose money while someone else grosses $100,000 and show a profit. Much of the success or failure in any business is how you manage it and respond to current economic changes.

To compare mileage and percentage lets take a look at a couple of scenario's. Let's say you have a 500 mile run that pays $1.50 to the truck on percentage. Your gross would be $750 for that run. Fuel should run approximately $200 (100 gallons at $2/gallon @ 5 mpg). Your gross profit after fuel is $550. Most of the mileage carriers seem to pay about $0.92/mile. Your gross on this same run would be approximately $460 (500 miles x $0.92/mile). Fuel would cost the same. Your gross profit running mileage after fuel would be $260. That is a $290 difference for the same run. I didn't include a fuel surcharge in these comparisons. The way rates are these days you may or may not be able to get $1.50 to the truck until the economy picks up. The type of freight can also make a difference in your rate. The more specialized your freight or equipment the higher the rate. Flats or step decks could have extra pay such as for tarping or extra drops and pick ups. Vans and reefers could have extra pay for drops or pickups and for assisting in loading or unloading.

A word of caution to the original poster. One thing to look out for when talking to those who run percentage is whether they are quoting you gross revenue or truck money. I know when I was leased to Landstar some years ago, most owner operators would quote the gross rate, not what the truck made. For easy calculations I will use $1/mile as the line rate. At $1/mile Landstar would pay $0.65/mile for power only and $0.73/mile if you have your own trailer. So the truck would actually make $0.65/mile for power only, or $0.73/mile with your own trailer, not $1/mile. I am not specifically picking on Landstar but that can be true of any who run on percentage.

In reality, you can make more running percentage or less than if you run for mileage. It all depends on the rate. I think most who run percentage earn more over the course of a year than those who run mileage. Running percentage you need to be more aware of rates and profit of a particular load. Mileage people seem to be more concerned with the number of miles they run. Percentage has more to do with profitability.

[Fredog]

I reduced my rate to 1 dollar a mile, this gets me more customers than I can handle, now all I have to do is run a million miles a year and I am a millionaire!!
I dont know why no one else thought of this.

[GMAN]

When you run mileage it doesn't make much difference where you run since all your miles should pay the same, although there are some carriers who pay less on deadhead or a different rate depending on the length of haul. When you run percentage the decisions you make can have a profound effect on your bottom line. You will need to be more aware of freight lanes and rates. You should no longer think about how many miles you can run in the course of a day or week. You will be more concerned about the profit you make on a particular load. Owner operators who run percentage have a different mindset than those who run for mileage. Or at least they should.

[solo379]

With all that said, when you run mileage, doesn't mean you shouldn't think of what you doing. Tho in a different terms. More like wasted time wise. For example, if paid on %, i could loose some time, and still come ahead with the money. On a mileage pay;-time=miles=$$$. Get familiar with your running area, avoid the places you could stuck....and so on.
What I've meant is that running w/o a head, wouldn't get you far, no matter how you got paid.

[GMAN]

Your income could still suffer if you get to an area where there is little or no freight and your company doesn't want to pay for your deadhead to a better area. You can wait 3 or 4 days to find a load in some areas unless you are willing to deadhead out. Personally, I won't sit that long for the possibility to get a load unless I am home.