Authority Pros & Cons

[Chamberpains]

(06-07-2018 )Otterinthewater Wrote:  

(06-07-2018 )Chamberpains Wrote:  Load boards aren't bad. You just have to know your operating costs and never operate under it. Leave loads that don't pay even if they are convenient or are gonna get you home.

Is the "leaving loads that don't pay even if they are convenient or gonna get you home" based on taking that load eventually drives the fair market rate down? When I first read this I stared at the computer like a dog turning it's head not understanding a new sound. In essence, eliminating poor route planing and not having a good pre-plan, available HOS hours, just strictly looking at cost. Lets say 600mi from my terminal/home and there was a load that paid $.95 per mile, after subtracting fuel cost that would be a meager $300 profit. Add the additional wear and tear for the weight .vs running empty and it's probably slightly better than breakeven. Factor in a an hourly wage for the roughly 12 hours to get back there and that $300 pays roughly $25 per hour. I'm not sure if this is the wrong way to look at this. I'm new so just looking for info.

thanks

Your not factoring in your daily operating costs (fixed) insurances, truck payment, authority and whatever elase. That'll chew up your $300 profit on that load long before you ever think about paying yourself. That was the point of knowing your operating costs. Just because it will get you home or its convenient doesn't mean it won't take all the profits out from under your whole week. Sometimes you have to say "well it won't pay going home with that crap load but if I take this load the other way and the following load will get me home 2 days later with better profit" well call the wife and kids and tell them they gotta stoke their own fires for another day or 2 cause dad needs to come home with everything he can because he's not doing this for fun. He's doing it to provide every last penny to his family from his hard work and refuses to donate any part of his life to someone that's not gonna pay for it. There load can sit and rot.
Or something like that.

[Otterinthewater]

(06-07-2018 )Chamberpains Wrote:  Sometimes you have to say "well it won't pay going home with that crap load but if I take this load the other way and the following load will get me home 2 days later with better profit”

I understand. I was looking at your previous statement two dimensionally. As in only accounting for A to B. Your thinking more A to Z. You go home when you get the right rate to go that way.

Thanks.

[Waterloo]

(06-07-2018 )Chamberpains Wrote:  

(06-07-2018 )Otterinthewater Wrote:  

(06-07-2018 )Chamberpains Wrote:  Load boards aren't bad. You just have to know your operating costs and never operate under it. Leave loads that don't pay even if they are convenient or are gonna get you home.

Is the "leaving loads that don't pay even if they are convenient or gonna get you home" based on taking that load eventually drives the fair market rate down? When I first read this I stared at the computer like a dog turning it's head not understanding a new sound. In essence, eliminating poor route planing and not having a good pre-plan, available HOS hours, just strictly looking at cost. Lets say 600mi from my terminal/home and there was a load that paid $.95 per mile, after subtracting fuel cost that would be a meager $300 profit. Add the additional wear and tear for the weight .vs running empty and it's probably slightly better than breakeven. Factor in a an hourly wage for the roughly 12 hours to get back there and that $300 pays roughly $25 per hour. I'm not sure if this is the wrong way to look at this. I'm new so just looking for info.

thanks

Your not factoring in your daily operating costs (fixed) insurances, truck payment, authority and whatever elase. That'll chew up your $300 profit on that load long before you ever think about paying yourself. That was the point of knowing your operating costs. Just because it will get you home or its convenient doesn't mean it won't take all the profits out from under your whole week. Sometimes you have to say "well it won't pay going home with that crap load but if I take this load the other way and the following load will get me home 2 days later with better profit" well call the wife and kids and tell them they gotta stoke their own fires for another day or 2 cause dad needs to come home with everything he can because he's not doing this for fun. He's doing it to provide every last penny to his family from his hard work and refuses to donate any part of his life to someone that's not gonna pay for it. There load can sit and rot.
Or something like that.

That is how I ran, and that is why I made my comment on running off of the load boards. The load boards are the land of the lost and the place you go when all else fails and you have to be "somewhere". Sometimes dead heading is more cost effective and better for the bottom line than hauling some of the garbage out there.

My load board comment comes from experience. Sure you may get lucky and find that good paying load, but that was rare. I used a few brokers, sadly none are in business any longer, and they took care of me. The one place I did find the load boards helpful though, is when I would use them for LTL freight. That took a bit of planning to put it all together and normally went off without a hitch.

I would run solar panels to San Diego on my Conestoga wagon, from the Detroit area, which was great because I had family there. I would visit for a few days and would search for LTL freight. I would run up as far as Oxnard bagging skids heading towards Michigan. It may take two days to get it all loaded, but in the end that normally paid just as good as that load out, in many cases better. It was a game, I would LTL my way across the country. That is the only time I ever found "load boards" interesting, or profitable. But, that was over ten years ago, maybe things have changed.

[Otterinthewater]

(06-08-2018 )Waterloo Wrote:  That took a bit of planning to put it all together and normally went off without a hitch.

It may take two days to get it all loaded, but in the end that normally paid just as good as that load out, in many cases better. It was a game, I would LTL my way across the country.

That is the only time I ever found "load boards" interesting, or profitable. But, that was over ten years ago, maybe things have changed.

Thanks. It is definitely something I will keep in mind.

[Evotrucker]

(06-07-2018 )Otterinthewater Wrote:  

(06-07-2018 )Chamberpains Wrote:  Load boards aren't bad. You just have to know your operating costs and never operate under it. Leave loads that don't pay even if they are convenient or are gonna get you home.

Is the "leaving loads that don't pay even if they are convenient or gonna get you home" based on taking that load eventually drives the fair market rate down? When I first read this I stared at the computer like a dog turning it's head not understanding a new sound. In essence, eliminating poor route planing and not having a good pre-plan, available HOS hours, just strictly looking at cost. Lets say 600mi from my terminal/home and there was a load that paid $.95 per mile, after subtracting fuel cost that would be a meager $300 profit. Add the additional wear and tear for the weight .vs running empty and it's probably slightly better than breakeven. Factor in a an hourly wage for the roughly 12 hours to get back there and that $300 pays roughly $25 per hour. I'm not sure if this is the wrong way to look at this. I'm new so just looking for info.

thanks

When i was dispatching, i was using DAT 360 not sure what its called now. I got a hold of the tech guy and asked him a bazzilion questions. they had some neat software on the system that shows you whats what in certain areas or states.

after 6 months of running east, we didnt run any further the pitsburgh, pa. Didn't see the need to get a load for $2.60 a mile and get one back for .40-60 cents a mile back. it wasnt cost effective for the long run, we made more money running 400-600 miles and got better paying loads back. also the dead head miles were a lot shorter, less wear and lighter loads.

dead heading back home depends, sometimes its the best thing you could have done or maybe worst.

[rrod]

(06-01-2018 )simon999 Wrote:  First three to six months are hard because some brokers wont give loads. But after that you good.

I wonder if this article is good sign for someone wanting to start with his own authority now.

With Truckers in Control, Money Talks and Toilets Sparkle

[Waterloo]

Short haul is where the money is. Just saying. From experience. Just my .02

[Waterloo]

(06-09-2018 )rrod Wrote:  

(06-01-2018 )simon999 Wrote:  First three to six months are hard because some brokers wont give loads. But after that you good.

I wonder if this article is good sign for someone wanting to start with his own authority now.

With Truckers in Control, Money Talks and Toilets Sparkle

Nestle has it down, at least here in Michigan. I primarily haul automotive, but we have one customer near a Nestle water plant here in MI. They are always good for a way out when up that way and it pays enough to not make us bitch. $1000 for 220 miles, something along those lines. I have only been there once, in and out in 40 minutes. Yes, it was a 40,000 lb load, but what the heck, it was down the street and got me back to the real freight.

Is it a good sign? My rates were up 30%+ prior to my adventure in becoming a diesel mechanic. Would I run out and get my own authority right now? No way. I do to good where I am at with ZERO headaches. Been there and done that, and fuel is the going to continue to go up. Factor that in with time to pay. I have no idea what the factoring outfits are doing right now, but you will pay the VIG.

Right now, the carrier I am leased to has 3 million in cargo and liability, supplies a new trailer and no fees anywhere to speak of. They take 30% and I get 70%. Their trailer breaks, they send a truck to fix it. My IFTA, I record the miles, they take roughly $20 a quarter out of my pay for that.

Yes, I pay my own 2290 and plates, another say $2800 a year. But, it is my plate, and the rates are good enough not to worry about it.

I have been down for three months as of now with this truck of mine. I still have a job, and am not concerned. My own authority, I would not would have been able to do any of this, especially not with a $3 million dollar cargo and liability account hanging over my head. A guy with one truck does not just write a check for that policy. At least not a guy with an EPA truck... ;-)

Step lightly, don't get trapped in all of this excitement, been there and done that, because it is just like the oil fields, BOOM! And then BUST. :-(

[Chamberpains]

All business owners know risk reward adages and sorta know how it works. Big risk big reward but also very high probability of complete failure is how it basically goes.

The trucking industry is chaulked full of this. With awful lows as 2008-2010 showed us. Flexibility is what keeps me above water and even keel. I would never live off the load boards or rely on a broker 100% as also I would never get locked into 1 or 2 customers with my own authority. Yes, you own the trucking business (you're the boss) but you are technically ran at the needs and wimms of the customers. They screw up or get lazy on you then often times your contractually locked in for whatever ride they take you on. And I can attest 1st hand when a customer files bankruptcy and they owe you $18,000 and your a small guy.... Well... 10 years and still not a dime and lawyers chuckle when you ask about it. Companies will shut their doors with no warning and if your lucky, you'll get an "I'm sorry phone call". But often times it'll be you showing up and doors and gates are locked with the lights out and the lot empty. It happens fast and literally over night. I've been there 3 times over the years.

Like Waterloo, I lease, pay my own plate, 2290 (heavy use tax) and I also file my own IFTA and carry my own liabilty insurance on the rig. The authority I lease to is responsible to maintain the authority and the paperwork associated and cargo insurance. I know where he LIVES so there is no simply disappearing in a flash. I do have to push him in either direction (for more or currently less freight) but that is as simple as a phone call or a quick ride up to say hi with a face to face conversation. We together have learned flexibility in trucking. He keeps a broad customer, broker, load board and new ventures open at all times. In turn I have a willingness to go anywhere and pull anything at almost anytime on my equipment. That keeps me so comfortably above all the trends and booms and scares that I don't hardly blink an eye or give a 2nd thought of the next crisis coming down the pipe. These all may be things to think of if you decide to get your own authority.

Flexibility at all times will keep that roller coaster feeling like a nice cruise across Kansas with the ability to jump in and out of a heart pounding screaming ride in the wildest places on the planet whenever you choose.