Originally Posted by Mackman

Im shocked no one said anything about steve booth yet

Originally Posted by GMAN

DRAG???!!! Hardly. You do know that it is just an avatar? It isn't real. Besides, I have more hair. :smokin:

Originally Posted by scrapmetal

Bad part about Kevin is he teaches you to haul cheep freight.

Originally Posted by GMAN

There is no need to mention him. As far as I know he is no longer in the business. It is a difficult industry with a very high failure rate.

Originally Posted by allan5oh

There are many ways to figure out your cost, that's why rates are all over the board. Some strictly figure cost per mile. I do not think this is a wise choice, as it does not take into account multi-drop loads or short hauls. Deadhead should always be figured in cost, as you're paying for this.

What works good for me is having fixed costs figured per day, and variable costs figured per mile. It works like this:

Days on road per month - 20

Truck Payment - $1600
Trailer Payment - $800
Insurance - $800
Other(accountant, etc..) - $300

So now we're up to $3500 per month, and we haven't even turned the wheels. We divide that amount by how many days we're out(on average):

$3500 / 20 = $175 per day

Now figure in variable costs:

Fuel @ 2.50 a gallon and 6 mpg = 42 CPM
Maintenance = 15 CPM
Driver = 45 CPM (figuring in drop pay, as well as source deductions)
etc..

Let's use 105 CPM for variable costs

Say it is Monday morning, and you want to pick up a load going 1000 miles, and it delivers Wednesday morning, how much is it going to cost?

$175 per day X 2 days = $350
1000 miles X 105 CPM = $1050

$350 + $1050 = $1400

Keep in mind this is oversimplified, and I've neglected many costs that you might have. But the basic calculation is correct. Too many people calculate cost simply based on cost per mile.

Do you plan on going out on your own? I would suggest maybe go on with landstar first, they are about the best way to get a feel on rates/lanes etc..

As far as deadheading, or a "backhaul rate", you always have to look at the big picture. If you're going up to Fort Mcmurray there's at least a 240 mile deadhead out of there, and even then the rates are ****. You always need to average it out. Pad the cost of heading out of Florida on the rate going in. Better get a good rate going in!

Originally Posted by Rev.Vassago

Very well put, and I'm glad to finally see someone who is calculating by the day rather than simply calculating by the mile. The only thing I would add to what you've put above is rather than calculating based on projected days per month you plan to run, use the entire calendar to calculate your cost per day.

In your example, you used $3500 per month as your fixed expenses. Take $3500 and multiply by 12 months, to get a yearly fixed cost of $42,000. Then divide by 365 to get a cost per day of $115.07.

Now say you're going to run that load on Monday that delivers on Wednesday. Add in the two days it will take to run the load, PLUS any days prior to the load when you weren't operating. Let's say you ran your last load on the Friday before. You'd use 5 days to calculate your fixed costs (Friday through Tuesday). That would give you a fixed cost of $575.35.

Basing your fixed costs off of something constant like a calendar eliminates the guesswork of projecting how many miles you'll run per week/month/year. That way you know EXACTLY how much it will cost to run a load when you add it to your variable costs, which should always be calculated by the mile (since the only time you have the variable costs is when the truck is moving).

Doing it this way will eliminate any miscalculation if you don't run your projected days per month, as the calendar stays constant. Except of course for a leap year.

Originally Posted by Rev.Vassago

Very well put, and I'm glad to finally see someone who is calculating by the day rather than simply calculating by the mile. The only thing I would add to what you've put above is rather than calculating based on projected days per month you plan to run, use the entire calendar to calculate your cost per day.

In your example, you used $3500 per month as your fixed expenses. Take $3500 and multiply by 12 months, to get a yearly fixed cost of $42,000. Then divide by 365 to get a cost per day of $115.07.

Now say you're going to run that load on Monday that delivers on Wednesday. Add in the two days it will take to run the load, PLUS any days prior to the load when you weren't operating. Let's say you ran your last load on the Friday before. You'd use 5 days to calculate your fixed costs (Friday through Tuesday). That would give you a fixed cost of $575.35.

Basing your fixed costs off of something constant like a calendar eliminates the guesswork of projecting how many miles you'll run per week/month/year. That way you know EXACTLY how much it will cost to run a load when you add it to your variable costs, which should always be calculated by the mile (since the only time you have the variable costs is when the truck is moving).

Doing it this way will eliminate any miscalculation if you don't run your projected days per month, as the calendar stays constant. Except of course for a leap year.