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As the owner/operator of a trucking business, you’ll know that being successful in the industry means you need to wear more than a single hat. You need to consider everything on the business side of things from cash flow to depreciation to gas mileage.
There’s never a better time than now to look at the year ahead and consider what you need to do in order to make this your most successful year ever. To that end, we’ve put together this list of tips that can help you thrive.
Manage Fuel Costs
It doesn’t matter what you carry in your truck, one of the largest expenses you’ll have is fuel. One mistake a lot of owner-operators make is confusing the lowest price at the pumps with the lowest cost of fuel. They aren’t the same and one way to mitigate fuel costs is to get a card that offers you good fuel card services.
The thing is, you have to pay state taxes on fuel that’s used as you drive through each state. When you purchase gas, the price at the pump is comprised of the actual price of the gas plus the taxes for that state. If you want to save money on fuel, check for the lowest base price and plan your purchases so that you can take advantage of them. Also, use a good fuel card.
Support Rates
Creating your budget as an owner/operator means you need to estimate both variable and fixed costs. You might need to justify the rates you charge to potential clients. Because of this, it’s critical to understand trends in both your niche and the trucking industry itself.
One thing that may help is to get a handle on the prices of fuel. Something that can assist with that is the fuel price tracker provided by the US Department of Energy. You might also want to backup your rates by knowing what the going prices are for specific lanes as well as any other influencers that can have an impact on your pricing. This can also include insurance costs, which will be influenced by any collisions or traffic infractions you or your drivers may have had.
Truck Purchases
Purchasing a truck means you need to understand how the vehicle will perform, the mileage it will get, and many other factors. You can definitely purchase a new truck, but there are a few things to keep in mind and a few compelling reasons to purchase a used one.
Let’s start with the mileage. When you’re talking to a truck salesperson, keep in mind that it’s in their best interest to be optimistic about the MPG of the truck. You need to have a realistic view of this based on the weight of the load you’ll be carrying, engine power, and road conditions.
You should base your purchase on efficiency, reliability, and power. Don’t be distracted by the various bells and whistles that will add to the cost of the vehicle and take money right out of your pocket. Focus on the needs rather than the wants — at least in the beginning.
Also, keep in mind that there are several benefits to purchasing a used truck as opposed to a new one. When you purchase a new truck, it will depreciate in value rather quickly. If you purchase a used one, the previous owner will have absorbed the depreciation.
The tips you just read will assist in making this year the most successful and profitable one to date as a business owner. Pay attention to your budget, fuel prices, insurance costs, and truck purchases and you’ll be more profitable before you know it.
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