Benefits (or Challenges) of an Independent Trucker
Posted on Wed, May 26, 2010 @ 10:22 AM
Consider for a moment you have $150,000 sitting around and want to invest it. You can put it into a CD and get a 5% guaranteed return or you can buy a tractor and trailer.
With the CD you get compounded daily interest of $25 with no risk and no effort.
With a tractor-trailer you get:
- A shipper requesting your truck at 8:00 AM for a 500 mile run for $750. If all goes well, after equipment payments, driver wages, insurance premiums, fuel, repairs and maintenance you should clear $75. The customer expects the load to be delivered today. (They request Just-in-Time service to keep their costs down.)
- A call from your driver at 8:30 AM that the load will not be ready for 2 hours.
- A call from your driver at 12:00 that he’s finally loaded and on the way.
- Keep in mind the DOT says your driver can not work more than 14 hours and he came on duty at 6:00 AM to pre-trip the vehicle and drive to the shipper.
- A call from your driver at 8:00 PM that his 14 hours are up and he’s still an hour from his destination. He must take a 10-hour break before he can continue. [His truck will now consume 10 gallons of additional fuel at $4.00/gallon to heat his sleeper while he gets his DOT-mandated rest without moving a mile.]
- Did I mention your customer expects the load today?
- A call from your driver at 6:00 AM that he’s on his way and will be at the customer at 7:00 AM.
- A call from your driver at 9:00 AM that he’s empty and available for another dispatch.
Your $150,000 truck has been tied up for 27 hours for $35 profit. The load should have been off the same day had it been ready. You didn’t quote the rate based on 27 hours. The driver now has only 11 hours left that he can work before his next mandated rest break. He will need to drive to his next shipper and wait to get loaded thereby further reducing the hours he’ll be able to drive.
During the 27 hours you’ve been exposed to potential Physical Damage (Comprehensive), Liability, Cargo and Workers Compensation claims any one of which (with current deductible levels) would wipe out the profit from a hundred loads.
What are you going to do with your money?
Rate increases and, perhaps more importantly, more trucker-friendly policies and procedures must occur in order to ensure an adequate supply (capacity) of safe, qualified trucks and drivers to keep freight moving and the fragile economic recovery on course.
Posted by Kevin Mullen- Director: Safety, ADS Logistics