Straight Truck Pay - % or mileage

BigBadBill

Active Expediter
I have always been of the mind set that percentage pay allows the O/O to share in the business and make better decisions. And that was on the truck load side.

But it even seems more important with S/T's. Am I off base? What is a good percentage to run for? Are rates are better than solid and I know from a business prospective we could make more running people mileage but I have never done that.

Thoughts?
 

davekc

Senior Moderator
Staff member
Fleet Owner
We do both and it really depends on the overall rate. Some pay a good percentage yet don't pay for deadhead or relocation costs. Some mileage companies pay those and while the overall rate may be less, they are actually making more overall if those costs are included. Have to look at the whole picture.
If something is a percentage, then one would have to see the bill to the customer. Or that would be my request. There was a time when a nameless carrier was running its invoices through a dummy company that they owned in order to re-bill at a lower number.
Still comes down to the rate, but transparency without a bunch of game playing gets my vote.
 

DieselDriver

Seasoned Expediter
Hi there, Triple B, I am an O/O of a straight truck, and have also driven semi's for both mileage and percentage...with todays Dot climate, repair and fuel costs you are leaps and bounds ahead by working for percentage. The deal is you have to factor in all of the variables to where all miles driven work out to be a percentage high enough to cover all of your expenses. The percentages would have to be at least 30-35% or more to equal the $1.35 - $1.60 a mile some companies are paying now. But realistically it is not really the pay, but it is the massive dead head that the customers or companies that we sign on to don't want to pay and the time we spend setting in the truck stop waiting for a load....then if you want a load you have to...you guessed it...deadhead somewhere at your expense to get it. For example, the company that I drive for pays $1.50 per loaded mile...short miles...which is good money, but don't like to pay deadhead and when they do its rarely more than .50 cents a mile, then after you deliver you usually wait...and you wait...depending where you are anywhere from 1 to 3 or 4 days and if your in Laredo...when you sit it costs you money and all of a sudden that really good run you just made for $2400.00 has dwindled down to who knows and you go from making pretty good money to breaking even or worse. Sorry for the rant, but I'm tired of staying out for months at a time and not making any money, so I am...still looking for an honest company to drive for...
 

Swamp30

Active Expediter
dave hit it on the head.. % of what? what they actually bill? or what they tell you? no way a company going to show you actual invoices..
 

BigBadBill

Active Expediter
Reputable companies will send you the rate confirmation invoice. I know all the skimming stories and these companies are a disgrace. Seems like there are more dirt bags in this industry than not. It is sad that cheating is the norm and honor is scoffed at.
 

rollincoal

Expert Expediter
Owner/Operator
Ok, as a TT leased to Bill's company I can say with certainty I know exactly what any load I have hauled has paid. I don't want to veer this thread off topic but a few points here. I negotiate and book the majority of load I haul. These are all spot market loads from brokers. I get the original rate confirmation on every load, so there is no funny business there. I have the ability and freedom to book or turn down any load I find myself or that is offered up to me, with no consequences. I can go home and not speak with anyone at the company for a month or 6 months if I choose to with no consequences.


Some things I gather from a few months of reading various threads on EO. Typical expedite companies tend to be like ordinary general freight companies from my perspective. For example at my previous carrier it was "no forced dispatch" for owner operators, but, they were a 175 trucks 400 trailers carrier, with a solid contract freight base. They had lots of freight going out from TN and always got us right back to TN. You could go up to NJ, and yes, you could refuse to haul the load you were dispatched to reload on, but the consequences, were, well, unpleasant. More or less you just let them dispatch as they pleased, dont ask too many questions, and they'd gove you miles. Or life would be miserable. Of course I understand their predicament, but really all I was as a contractor for that company... ...I was just extra "cheap" capacity for them to keep their customers happy. There is no freedom in a situation like that. No way to grow as a single truck operation and really learn anything of value about the business.. Nothing but hoping to get all the miles one can possibly get....

I get the impression that as a sprinter truck, or even a straight, or TT that most of these expedite companies keep a tally and percentage of "how many loads this driver turned down" or how many that one did... ...That these expediters are told it is "non-forced dispatch" and they "can refuse any load" but that reality is life will become difficult if they do.. Now again I understand the reasoning behind that.. Cause lots of owners don;t run things like a business and oddly think of their company as a travel agency.. Or whatever... The point is that is force dispatch by hook and crook, no different than my situation at my old carrier. Really there was no say at all in which directtion the truck went... where it went etc... The company could easily broker that freight out of their contractors wouldnt cover, heck, most times they make more money off of it that way.. Operating in an almost truely independant sense (only the fact that it is not my own authority is what makes it different), I think of all the times I found a hot location all on my own where they had shipments going out round the clock and I was able to capitalize on it because I was the only one who decided where my truck went and for what price... That sort of thing would never happen at a carrier that dispatched me, I would just roll wherever...

If scores are kept on contractors for refusing loads then that is not a "no force dispatch" operation "without consequences" otherwise why keep score? Now onto the fact that deahdea pays zero in a percentage operation. That is completely untrue. You run that truck like a business and your price yourself to cover all deadhead. I average a lot of deadhead in the course of a month or a year's time. I deadhead as much as 400 or 500 miles to pickup a load every once in a while. No-one ever tells me I have to. I made a business decision there and did it without any regret. In other words, if you're gonna run percentage you need to know your costs, what you need, price accordingly and the deadhead's always bought and paid for... If you have a carrier paying percentage breathing down your neck for refusing to deadhead 300 miles, because you have decided the rate isnt worth it (or whatever), and they are keeping score with plans to make the next several days or weeks miserable - then really you have no control whatsoever over your operation. Now it's possible I'm all wrong about the feelings I have for "typical" the way it's done, if so, someone correct me.... To sum up my feelings here if an operator has a little common sense about them and the ability to pick and choose what they do they will never go wrong on percentage. Not everyone is cut out for it though.. And it doesn't fit the model or needs of most companies out there leasing contractors on... But the truth is most of them are force dispatching whether they want to admit it or not...
 
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Moot

Veteran Expediter
Owner/Operator
dave hit it on the head.. % of what? what they actually bill? or what they tell you? no way a company going to show you actual invoices..
By law a carrier must provide an O/O being paid on a percentage basis a copy of the original billing invoice at the O/O's request.
 

Rocketman

Veteran Expediter
Ok, as a TT leased to Bill's company I can say with certainty I know exactly what any load I have hauled has paid. I don't want to veer this thread off topic but a few points here. I negotiate and book the majority of load I haul. These are all spot market loads from brokers. I get the original rate confirmation on every load, so there is no funny business there. I have the ability and freedom to book or turn down any load I find myself or that is offered up to me, with no consequences. I can go home and not speak with anyone at the company for a month or 6 months if I choose to with no consequences.


Some things I gather from a few months of reading various threads on EO. Typical expedite companies tend to be like ordinary general freight companies from my perspective. For example at my previous carrier it was "no forced dispatch" for owner operators, but, they were a 175 trucks 400 trailers carrier, with a solid contract freight base. They had lots of freight going out from TN and always got us right back to TN. You could go up to NJ, and yes, you could refuse to haul the load you were dispatched to reload on, but the consequences, were, well, unpleasant. More or less you just let them dispatch as they pleased, dont ask too many questions, and they'd gove you miles. Or life would be miserable. Of course I understand their predicament, but really all I was as a contractor for that company... ...I was just extra "cheap" capacity for them to keep their customers happy. There is no freedom in a situation like that. No way to grow as a single truck operation and really learn anything of value about the business.. Nothing but hoping to get all the miles one can possibly get....

I get the impression that as a sprinter truck, or even a straight, or TT that most of these expedite companies keep a tally and percentage of "how many loads this driver turned down" or how many that one did... ...That these expediters are told it is "non-forced dispatch" and they "can refuse any load" but that reality is life will become difficult if they do.. Now again I understand the reasoning behind that.. Cause lots of owners don;t run things like a business and oddly think of their company as a travel agency.. Or whatever... The point is that is force dispatch by hook and crook, no different than my situation at my old carrier. Really there was no say at all in which directtion the truck went... where it went etc... The company could easily broker that freight out of their contractors wouldnt cover, heck, most times they make more money off of it that way.. Operating in an almost truely independant sense (only the fact that it is not my own authority is what makes it different), I think of all the times I found a hot location all on my own where they had shipments going out round the clock and I was able to capitalize on it because I was the only one who decided where my truck went and for what price... That sort of thing would never happen at a carrier that dispatched me, I would just roll wherever...

If scores are kept on contractors for refusing loads then that is not a "no force dispatch" operation "without consequences" otherwise why keep score? Now onto the fact that deahdea pays zero in a percentage operation. That is completely untrue. You run that truck like a business and your price yourself to cover all deadhead. I average a lot of deadhead in the course of a month or a year's time. I deadhead as much as 400 or 500 miles to pickup a load every once in a while. No-one ever tells me I have to. I made a business decision there and did it without any regret. In other words, if you're gonna run percentage you need to know your costs, what you need, price accordingly and the deadhead's always bought and paid for... If you have a carrier paying percentage breathing down your neck for refusing to deadhead 300 miles, because you have decided the rate isnt worth it (or whatever), and they are keeping score with plans to make the next several days or weeks miserable - then really you have no control whatsoever over your operation. Now it's possible I'm all wrong about the feelings I have for "typical" the way it's done, if so, someone correct me.... To sum up my feelings here if an operator has a little common sense about them and the ability to pick and choose what they do they will never go wrong on percentage. Not everyone is cut out for it though.. And it doesn't fit the model or needs of most companies out there leasing contractors on... But the truth is most of them are force dispatching whether they want to admit it or not...
You make very good points about forced dispatch. I understand the need to fulfill customer demands. I also understand that there are many reasons why there is a need to encourage some to take a load... but it is still forced dispatch. The make-up on the pig is just a little thicker.

The main thing that will turn "forced dispatch" into "let me have it man, I'm beggin' ya, LET ME HAVE THAT LOAD!" dispatch is how many zeros are there to the immediate left of the decimal point. The truly reasonable rate is somewhere in between.
 

Swamp30

Active Expediter
i worked as a terminal manager and o/o retention manager for a trucking company with 19 terminals..there are ways around the law and the companies all use the same process. Ever wonder why companies have like 3 or 4 different company names that are roughly the same? ie; hot line freight systems and hot line freight..same company..our owner ops got paid 80% ..so if i booked a load with a customer for say 3k i would "sell" it to the sister company for 2400 and then to the owner op..very few companies are going to be completely honest with you about load pays..this waa main reason i left the company i was with..felt like i was stabbing my own brothers in the back.
 

Turtle

Administrator
Staff member
Retired Expediter
I learned today that "no forced dispatch" means having no consequences for your actions.

I have always been of the mind set that percentage pay allows the O/O to share in the business and make better decisions.
Oh, I dunno. I've been on both percentage and mileage pay, and I've made some pretty bad decisions with both.
 

rollincoal

Expert Expediter
Owner/Operator
There are consequences for every decision. That much is a given and I sort of took for granted most anyone around here already knows that.. ..but really there are a lot of owners out there who don't/can't seem to grasp that. Make poor decisions, then blame everyone else for their own shortcomings.
 
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