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There’s more to earnings than pay per mile
Successful owner-operators know that simply running hard is not enough. If it were that easy, anyone could do the job and expect the profits to roll in.
Understand it pays to slow down and that there is a tradeoff in higher costs, not to mention the increased risk, for driving fast. If driving slower takes time away from you, you can find ways of managing your time to get some of it back. For example, you can take vacation time or plan major work on your tractor during the first week or two of the quarter (early January, April, July and October). Never take time off during the last two weeks of the quarter (or the last week of the month) when freight typically is abundant.
Sometimes it works to your advantage to look for loads that take you “through” home rather than “to” home. The latter can interrupt your revenue stream and require additional time to get back up to full speed again.
As an owner-operator, you should look at time off differently from a company driver. If a company driver takes a week off, he loses only the opportunity to make a weekly paycheck. When an owner-operator takes a week off, he has fixed expenses to pay and won’t be earning a paycheck. When he returns to work, he not only has to replace the lost income, he also quickly must cover the fixed expenses that were spent during his time off. For example, for an owner-operator with fixed costs of $100 per day, seven days off would cost $700 in payments that still have to be made.
Though truly long-haul work remains the bread and butter of many an owner-operator, opportunity in regional- and short-haul work continues to expand. Average length of haul has declined markedly in dry van and, increasingly, in refrigerated.
Shorter hauls take more time, and they cost more money on a per-mile per-load basis. While carrier pay packages adjust to shorter hauls with premium per-mile rates or other tactics, they’re not always quick to follow the freight trends.
As freight regionalization continues to hit other segments, close work on the part of owner-operators and their customers and dispatch assumes much greater importance in maximizing income.
THE SUCCESSFUL OWNER-OPERATOR’S DAY PLANNER
Smart owner-operators make every single week as profitable as possible. One trip is not enough time to be considered profitable or unprofitable, and an entire month may be too much time to manage. One week is the right amount of time to deal with efficiently. To do so, look at the advantages and disadvantages of every day of the week.
- Match trip length to the optimum day of the week.
- Plan to deliver on the day you have the best opportunity of getting a load.
- Plan to drive under a load on days when it typically is harder to get a load.
Your personal weekly plan will vary depending on the weekly delivery/flow cycle of your region, typical length of haul, personal requirements and other factors.
The needs of customers and dispatch have to be considered and often will determine how your time is used. What’s important is to have a specific weekly plan that helps you be successful.
SUNDAY: It’s like getting in an extra day if you can pick up or deliver on Sunday, since this typically isn’t a day for either task. Being able to make the most of Sunday gives you a good head start on the week.
MONDAY: Profitable owner-operators deliver on Monday. Why? Delivering the first load of the week on Monday lets you start your week with miles already generated and leaves time to be profitable during the rest of the week. On Monday you’ll find more load opportunities than on Tuesday, too.
TUESDAY: Unless it’s a 2,000-mile trip, delivering the first load of the week on Tuesday means the week usually won’t be profitable. Tuesday is the day to take a hard look at how many miles you have driven and how many more you need to have a profitable week.
WEDNESDAY: It’s hump day. By now, about half of your gross revenue for the week already should be in hand.
THURSDAY: This can be the make-or-break day of the week. A load picked up on Thursday should either be short enough (less than 600 miles) to deliver on Friday, or provide enough miles (at least 1,600) to carry you through the weekend. Try to average 550-600 miles per day for the trip, although on Thursday it’s almost always better to take a 350-mile trip and deliver it on Friday. Turning down a short run just because it would mean laying over until Friday may turn out to be an expensive mistake.
FRIDAY: This usually is the best day of the week for freight. Being under a load with the longest possible miles over the weekend will make the best use of your time.
SATURDAY: The week is over, and your work and planning should have resulted in a profitable operation. But like Sunday, Saturday is an extra day if you can pick up or deliver a load.
Many an independent owner-operator has realized high freight rates by being the 911 service on the weekend for a trusted broker. If you’re using load boards on the spot market and can make yourself available on Saturday or Sunday by posting your truck, you might be surprised by the good results.
Download the entire Partners in Business Manual
Chapter 1: Becoming your own boss
Chapter 2: Bookkeeping and business analysis
Chapter 3: Understanding your revenue and costs
Chapter 5: Controlling fuel costs
Chapter 6: Controlling tire costs
Chapter 8: Income tax and other taxes
Chapter 9: Choosing a business structure
Chapter 10: Truck buying, leasing, financing
Chapter 11: Choosing a trailer
Chapter 12: Maintaining your equipment
Chapter 13: Choosing a carrier
Chapter 14: Computers, mobile devices and the internet
Chapter 15: Staying compliant and safe
Chapter 16: Trucking insurance
