• Rate to the truck inherently stable with miles
• Often little self-dispatch freedom
• Fuel surcharge often averaged among fleet accounts/diesel prices
• Niche specialization possible but not in operator’s control
• Home time in control of dispatcher
• Rate per loaded mile variable by lane/market conditions
• Self-dispatch often available
• Fuel surcharge paid in lump according to individual negotiated accounts
• Niche specialization by lane/freight within reach with self-dispatch
• Home time a function of operator’s ability to customize schedule
Planning Profit Under Percentage Pay
Under a percentage pay plan, the owner-operator typically takes home 65 percent to 75 percent when pulling the company’s trailer. It’s a few percentage points more with his own.
Miguel Dunkelberger of Middleville, Mich., however, has found a deal he calls the “best I’ve run across in years” with a full 90 percent of the gross pay package, leased to LR & Sons Trucking of Grand Rapids.
Before your eyes pop out of their sockets, keep in mind Dunkelberger, who drives a 1996 Marmon 103D flattop, pulls his own 53-foot 1997 Trailmobile dry van. In addition, he says, the high percentage is due in part to the 22-driver carrier being young and trying extra hard to attract other owner-operators.
Also, costs many leased owner-operators don’t incur, regardless of pay package, play a part in the carrier’s ability to offer the high percentage: chargebacks for cargo and primary liability insurance.
“All in all it runs just over $200 a week,” Dunkelberger says, for those plus insurances more typical for leased owner-operators (nontrucking liability, physical damage). Perks include in-house IFTA preparation, a carrier-provided fuel card, and PrePass.
Success under a percentage program required owner-operator Sam Mobley to change weekly targets from miles to revenue, achieved on the fewest miles possible.
“I might take a high-paying load into Pennsylvania,” he says, “and take $1.70 a mile. But I might only get $1.02 per mile out. That lower-paying load — you hope that will be fewer miles and average the two together to make a decision.”
In this market, he says, he’s happy with $3,000 to $4,000 weekly in gross revenue. Running mostly long-haul, he tries to book a load leaving Sunday. “You have a good shot at hitting your target that way,” he says. If you come out on Tuesday, “you might just do two loads that week” for $2,700 or so in revenue.
Evaluating percentage plans requires knowing your revenue and costs. With the fuel surcharge, Mobley says, some mileage-paid operators at Schneider National might average $1.42 a mile in revenue, “but I’d average $1.37, and it’s my choice to do it that way. I’ll make up the difference by doing more in income than they will” with lower overall costs on fewer miles.