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Successful Trucking * USA
Creatures of habit
USA -etrucker/Overdrive, by Todd Dills -March 2007: -- Any successful business is a product of successful practices. An examination of respondents to the 2007 Overdrive Owner-Operator Market Behavior Report — and especially those whose net income ranks in the top 25 percent — reveals highlights on the road to success... The typical high-earning owner-operator is a little more than 50 years old and has been in business as an owner-operator since he was 30. He makes more than $70,000 a year after expenses and is three times as likely to be leased as independent... As with any linkage of income and other factors, a given practice — say, computing cost per mile or performing oil analysis — might not produce several thousand dollars of extra income year after year. But those behaviors do save money, and often are indicative of a broader business-oriented mind-set that pays off in the long run... On the surface, the high-earning owner-operator isn’t much different from average and below-average earners. Look closer, though, and you’ll see a combination of characteristics that many owner-operators don’t have. The following seven practices, based on this year’s Behavior Report, should provide a few ideas to help boost your income...
* WORK FOR A PERCENTAGE OF GROSS: O.J. Luster of Macon, Ga., leased to Cross Country Express of Sparks, Nev., pulls a company reefer with his aerodynamic Kenworth T2000. He prefers getting paid a percentage of gross revenue because it allows him more control. “I have much more latitude as far as what I’m doing, where I’m going, and how much I make,” says the 15-year owner-operator...
* BUY YOUR OWN TRAILER: A little less than half of Behavior Report respondents own the primary trailer they pull. That same half makes at least $6,000 more yearly than owner-operators leasing trailers or pulling a carrier-provided trailer. “If you provide your own equipment, they’ll generally pay you a better rate,” Brady says...
* INVEST IN AN APU: Auxiliary power units drastically cut idling time, especially in applications that require a lot of waiting or that involve lots of overnight hauls in northern states. Increasingly, they’re proving themselves as fuel- and engine-savers. “The guys that are buying them are the leaders of the pack in terms of being willing to invest in new technologies,” says Amy Egerter, spokeswoman for gen-set manufacturer RigMaster Power, based in Toronto...
* MAINTAIN A SIZABLE SAVINGS FUND: Of all the financial practices that can help an owner-operator, one of the most critical is maintaining an emergency savings fund for major maintenance expenses. Less than half of owner-operators surveyed maintained such a fund, but they averaged nearly $9,000 more in income... This variance can be explained by different factors, Brady says. “You might naturally be a saver. It could be a personality thing”...
* DO REGULAR OIL ANALYSIS: Successful owner-operators stay on top of preventive maintenance to avoid downtime and get the most out of their equipment, whether they trade every three years or every 15 years... Regular oil analysis stands out as a practice of high earners in the 2006 Behavior Report...
* BUY NEW EQUIPMENT: A new truck isn’t right for every owner-operator. Those new to the business, with little or no equity to help reduce the truck loan and its monthly payment, and without the miles or volume to guarantee enough income to cover the high monthly payments, usually do better starting out with used equipment... According to the Behavior Report, those who do buy new typically make $7,000 more than those buying used and $12,000 more than those leasing...
* KEEP DETAILED RECORDS: Owner-operator Jerry Knight keeps track of cost per mile by charting his expenses in detail. “My wife does most of that,” he says. “It’s important.”... Tracking his costs and other operating information enables him to know exactly how his business works and helps him make sound decisions — for example, he says, his recent installation of a gen-set... These owner-operators have the information they need to separate best practices from stuff that just doesn’t work, thus boosting their take-home dollars in the end...
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