expenses vs profit

[fketchum]

Hi everyone
I just got the application packet from one of the expediting O/O companies and I was hoping I could get some feedback on how to be profitable as a expediter. How do I figure a operating cost and at what point is a run profitable. how much cash should I go in with as a buffer and so on. I understand things are slow right now but I think we are past the worst of it. I'm willing to take the gamble.

Thanks
Frank

 

[LDB]

Read back at least 2 years in the General, Newbies and Recruiter forums. That doesn't mean every word of every post. That means looking at the thread titles and reading ll of the ones that address your questions and concerns. Go to OOIDA.com and join and download their spreadsheet. Use any member's number and you'll get a discount on your membership. Don't even think about buying a truck until you've done at least that much research/studying. You should have literally hundreds of hours of reading/studying here and elsewhere before making any absolute decision. This is a career just like accountant, mechanic, process control engineer or anything else. Don't jump into this without as much research and education as you'd get for any of those others.

 

[fketchum]

Thanks for the referral to the OOIDA web site I went to the site and downloaded the spreadsheets. After looking at the them it seems its almost impossible to come out ahead or some of the figures on the spreadsheets are exaggerated
I'm referring to the Lease and cost per mile spreadsheets
does anyone see anything on these spreadsheets that are out of line

 

[Dreammaker]

Before I became an owner operator, I used Business Plan Pro to setup a business plan to see if I could make a profit in this business. Perhaps, the spreadsheets from OOIDA do the same thing. No matter what you use, I would have someone who's been in the business for several years look over your shoulder and make sure you have included most potential expenses. Secondly, I currently use The Trucker's Helper for just about all of my accounting needs. You just plug in all settlements and expenses and it shows you your cost per mile and hopefully profit per mile. From that point, you can multiply profit per mile by what your income needs are to see if you can feasibly make enough money in the expediting business for you to meet your income needs. Finally, I also use You Need A Budget Pro. It is perhaps the best program I have found to get ahead financially. As Leo pointed out, spend a lot of time running the numbers before you get in this business. Best of luck to you.

 

[mypie]

There are a lot of variables in this biz. This is what makes it impossible for anyone to truly give you hard numbers. What carrier will you sign on with? What do they pay (avg.) per mile? Will you be running special services? What is the average deadhead? What do you need/What are your personal expenses? Are you running for a fleet owner? What is the fleet owner's responsibility? Do you pay fuel or does the fleet owner? If you pay fuel, does your fleet owner want to keep the fuel surcharge? (Sometimes they do.) Who pays maintenance? How old is the truck? Etc., etc., etc.

 

[fketchum]

Thanks for all of the responses. I just downloaded The Trucker's Helper and that seems like a great tool.
After playing with the OOIDA spreadsheet its looking like I'll be buying a used truck. hopefully I would be able to get my weekly payment down to 300.00 or so.
What is a realistic MPG for a 24ft straight truck? and again thanks for all the help

 

[nightcreacher]

I wish you all the luck in the world,cause with the questions you are asking,you are going to need it.
There are two types of expenses,Constant and Variable.
Your constant expenses,are going to be the same every month,whether you work or not.Variable expenses change with the amount of miles you drive,and how much you spend to operate the truck on the road.
Whether you buy a new truck or used one,the lower you can keep the variable expenses the better off you will be.
Your constant expenses,such as depreciation,interest on note,truck insurance,qual com,cell phone,office rent,office help,you can get the kids involved here.
If you know how much money it takes to do the house hold expenses,add that to the constant expenses,you then will know what you can afford to to spend on the road to keep the truck moving
As far as opearting expenses,most companies will give you an advance on the load you are hauling after it is picked up,and you might figure about 10 days to 2 weeks before you get the rest of the money for that load or the rest of the week.
It would be good to have enough money to pay the bills for a couple of months,in reserve.
Good luck again