and, Can you estimate the appropriate $ per mile, that should be planned and budgeted, for each?

I'm stumped on Market Risk.
Not the market price, on equipment...
the risk that business will dry up.

This was an aspect of business, for which I've never seen anybody anywhere make any mention of.

 

Depends on where teh economy is in the business cycle I think.

How about building a business model around 100% chance of a 12 month recession in 5 years. Therefore on would want to have replaced all of one's investment and then some, before the 12 month recession started. This would enable the business to sit out the lean period.

 

The main risk element you have in trucking for which you can budget is maintenance and breakdowns. You can also budget for slow times of the know business cycle. Ideally, you will have at least 6 months of operating expenses set aside. You should also have enough budgeted to take care of the most expensive equipment failure. In the case of trucking, it is usually the engine. There are a lot of variables in budgeting for risk. You will NEVER be able to budget or plan for ALL contingencies or risks when it comes to business, regardless of the type. You could set aside a flat rate for maintenance out of each pay cycle, such as $0.10-0.15/mile or s specific dollar amount, such as $500. You can also set aside a specific amount of money out of each pay cycle for your safety fund until fully funded.

 

Thank you, both, rank and GMAN.
Don't nothing slip past you guys.

Looks as if I'm slipping, a bit, based on the number of views.
You would think that current conditions would lead a lot of drivers to focus like a laser, on the risk that is ever present.

The purpose of the post, like most that I do, was to raise the bar, to generate a new level of discussion, that is not normally seen in trucking.

There is lots of talk about treating it as a business, but so little discussion beyond how sharp the pencil is.

There is a huge cost to the business of trucking, that could easily be covered with a fairly blunt pencil, if the rates could rise enough.

I guess I need a better topic line, so, back to the drawing board.

 

I guess you are not a subject to a random drug test!? :roll: :P

 

Ya think?
:P

 

Business drying up is always a risk. While most sectors will never see a massive dry time, the lean times can come up and bite the unsuspecting in the rear.

Are you mainly focused on having your own authority or leasing on to a carrier?

 

I'm leased on, with an attitude. I run my rig, and if it don't pay, I don't move - generally speaking.

I just don't believe in subsidizing some other business. It is a difference of going broke fast or slow, with free labor to boot.

The thread was intended to raise the level of discussion, regarding real issues that hardly ever get mentioned.

Everyone says run it like a business, but all too often it evolves into a spread sheet discussion.

Business is often down in the gutter dirty.
There are strategies and tactics.
There are skills, such as negotiating rates, terms, conditions, and any number of other issues.

To run a business, you must be able to recognize a compelling tactic that leads you to act against your better judgment. Then, you must be able to react in a way that improves your situation, rather than harm it.

There is a lot to business that never makes it to the public eye.

That's why I say that a business man is usually heavily scarred. That is from daily battles - some won, some lost. The war never ends.

So, if you meet a driver pulling a high dollar load, pay him your respects.
Particularly these days, not many high dollar loads floating around in search of just any truck to pull it.

 

When you plan for break down or accident, plan big.

They can cost a lot in down time, too. In 10 years, we've had 2 $10k break downs and one $16k break down. We've had several accidents that cost us a lot in down time- even though the insurance took care of it (doesn't matte if it's your ins or theirs), you're still sitting there with no $ coming in. Downtime insurance helps- but doesn't make up for the lost income or the cost of getting back into the swing of things.

 

The dirty interlopers have had control and have been taking advantage, for too long.

If your business has slowed down considerably, try staying closer to home.
When you initiate contact and are offered a load from brokers and agents:

Ask for 40% more, then shut up.
And Wait.
Wait some more.

If the agent counters with a 50 $ raise, grunt the word "huh?".
Then Wait.
Wait some more.

If the agent wants to negotiate, listen, then counter offer with 35%, or even 36% - to send a message.

The cost of fuel inflation is a given.
Most don't consider the inflation on everything else, from tires to eggs.

It is past time to start.

Now, when you settle on the load and the rate,
you are ready to play hard ball.

This is when you ask for a "Back Haul".

Get the back haul lined up, the same way you negotiated the rate on the original load, as a condition of accepting the original load.

If there is no back haul,
You should ask for a round trip rate.
That is the rate you negotiated for, on a one way basis.
Only now, you get paid for your time and expense, to dead head home.

Otherwise, why bother?
There is an added benefit to asking for a Back haul, and insisting on a high rate, at the same time.

Number one: It will mess with the agent's mind.
Number two: It will re-define the concept.

There are equipment shortages showing up, now.

Now is the time to recover control.
Truckers are dropping like flies.
And, don't think that the shipper isn't already paying the rate.

You can go broke working, just as quick as you can go broke watching TV.

The time is Now.
As long as you run your own truck, it is up to you, individually.

Only now, you are not alone.
More and more truckers are doing this, now.
At least the ones still standing.