Fleese Operator....And I Like It!

Discussion in 'Lease Purchase Programs' started by Amarillo, Feb 5, 2012.

  1. Copperhead

    Copperhead Well-Known Member

    If one is independent, then all your numbers would be pretty accurate. But the majority of OTR truck owners are doing work with carriers in some way or form.

    Many will cry out that one cannot make it in trucking getting a buck a mile and FSC. It's not that hard linked up with the right carrier and operation. When I can get my physical damage for $2 per $1000 in value of the truck, and bobtail ins $27 a month, OCC/ACC (workmen's comp) for $136 a month, I get my plates reimbursed, the miles I am paid on are pretty accurate for miles it actually takes (I average 2.4% out of route annually). I have no cost associated with IFTA, I get from between .20 and .50 off the cash pump price on fuel (with a max of $0.75 charge for swiping the fuel card, sometimes no charge), I get roughly $50 an hour for detention after the 1st 2 hours, and I get $100 for each additional stop. Only fee I get charged for is $10 a week for the Qualcomm, but it also has a pretty good GPS routing feature so I don't have to shell out for one of those GPS units. I opt for having the Prepass that I also pay for, but that pays for itself in less fuel used going into scales and time savings, and all for about the price of a large supreme pizza a month. No deposits on qualcomm, no trailer rental or fee. I have a blue cross blue shield health plan I got thru an independent agent for $340 a month for both me and the wife with a $5 million lifetime medical payout coverage. I have multiple relational spreadsheets set up on my laptop, so I can track things as they happen and bookkeeping / record keeping is very low cost. Expense receipts / invoices get scanned into my computer and I don't have to keep track of a lot of paper. In January, I PDF the spreadsheet that consolidates all this information to my accountant and he does the tax filings.

    True, many do not have the same situation as mine, but they need to question why they stay where they are, and how they are running their operation. But as far as actual cost to run a truck, it doesn't take $1.76 (+FSC) to operate a truck and still have a decent net income. You just need a decent contract and the mindset to run a business.
  2. j911brick

    j911brick Well-Known Member

    Spell it out and break it down; how much does it cost?
  3. Copperhead

    Copperhead Well-Known Member

    Well.... my average cost to operate per mile from Jan '12 - June '12 is right at $1.05..... that is every expense including medical insurance, truck payments, and estimated tax set aside fund.

    During the same time period, my average revenue per mile was $1.51. For an average net of $.46 cents a mile AFTER TAX That is free and clear money. Or since the beginning of the year till June 30th, based on the miles I ran, $31050 of clear, after tax money.

    Keep in mind, that is after Fed Income tax, self employment tax, and state tax, and every single expense and truck payment and personal medical insurance. And those tax set asides were estimates prior to buying my new truck. Taxes will actually be less now that I have purchased a new truck and will have $15,439 in additional depreciation expense this year, so my after tax money in pocket will be higher than the spreadsheets show for the the time period I referenced. And my new truck payments are only $165 a month higher than they were on my previous truck... $1501.00 a month for a brand new 2013 truck after what i put down on it. And my average maintenance cost per mile will drop considerably also. Especially since this truck is a 2013 Columbia glider truck with a pre-EGR Series 60 in it.

    Clear enough?
  4. blackw900

    blackw900 Flatbedder For Life!

    Mine comes in at closer to $1.47 a mile....But I pay for things that you don't pay for such as IFTA and my own plates and such. I am not with a large carrier and have no desire to ever be with one, Because of these things my rates are higher by quite a bit....These things vary from operation to operation.
    Someone that pays all of the expenses related to running the truck such as the ones I mentioned above would be a fool to run for $1.50 a mile and many O/O's fall deeply into that category.
    I think that claiming CPM of $1.76+ FSC is is a gross exaggeration or a typo....I wouldn't run for less than that as a rate, But to call that base operating CPM is completely unrealistic unless you have a $6,000 a month truck payment.
  5. j911brick

    j911brick Well-Known Member

    That's not really what I had in mind.

    Pretend for a moment that you are actually a businessman with money to invest. You need to buy a truck and hire a driver to sign the truck on with a carrier. Now work up a hypothetical monthly income statement and tell m the costs are based on an industry average 10k miles per month.
  6. blackw900

    blackw900 Flatbedder For Life!

    What'd you want a spread sheet?? I was able to read his post and understand perfectly well what he was trying to say...I have read his posts both here and on another site and even though I often don't agree with some of the things he's thinking with regard to his philosophy on truck spec'ing, I never doubted for a moment that the man is a "businessman" that knows exactly what his numbers mean to his operation.

    Your numbers on the other hand don't really make much sense....Maybe they do in your operation but I have never seen base CPM numbers that high in a normal over the road apllication.
  7. Copperhead

    Copperhead Well-Known Member

    That is why I agreed, for the most part, with j911brick's numbers when someone is independent or another game plan. And one doesn't necessarily have to be with a "large" carrier to get a deal similar to mine. I am with a 300 truck dry box outfit and I stay primarily in the midwest. I have no doubt, based on your situation blackw900, that the rates per mile I average wouldn't work for you. Never implied that they would.

    Of course, each situation is different, and the rates one gets would have to be determined by that situation. I am just tired of seeing a lot of no thought put in to it posts that say things like "no one can make it on a buck a mile" and other such comments that are meant more to demean someone than try to figure out what their operation is. The reality is that it is almost the same as no two people have the same fingerprints, no two trucking operations are exactly the same. It is borderline stupid to just throw numbers out there and say "no one can make it on xxxx amount", or it "costs xxxx amount". It all depends on the total package in the contract and a laundry list of other factors. I wouldn't haul for some carriers that pay the same rate as my carrier does. Almost begs the question, "why not". The answer would be, "because the package deal isn't good enough". The rates per mile on the revenue side is just a starting point for the discussion. If some carrier wants me to haul for them, the discussion on whether I will do it or not, will take more than a few minutes and just telling me what the rate per mile is. A single phone call just won't cut it. I have to review the entire contract and know a lot about the carriers operation and customer base. I run a business, and I want to know the details of a carrier's business before I risk my business linking up with them. And like you, blackw900, I probably will never link up with a "large" carrier, simply because they usually will not disclose the details of their operation that I would need to make an informed decision.

    And j911brick, there is no "industry averages". This is such a diversified business we are all in that it just doesn't lend itself to analysis like a Fortune 500 company on the stock exchange. And we are talking sole proprietor type operations here. Even the area one lives in the country and the subsequent cost of living in that area factors into whether an operation offers enough profit to the individual. To do it right, requires a lot more thought and detail that just can't be quantified on a spreadsheet. That is the primary reason many lose their shirt running a truck. They just don't have the perspective and business acumen to do it right. Many still have the mindset of a company driver. That is not to demean them, that is meant to show that one must understand the trucking operation they are getting in to.

    Thank you, blackw900, for your comments.
    • Like Like x 1
  8. Copperhead

    Copperhead Well-Known Member

    And isn't that the beauty of trucking? We all don't have to agree on everything, because our operations are that diversified. Like your comments on how I spec my truck. I wouldn't begin to suggest that it is a "one size fits all" deal. And in the broad scheme of things, I may wish I did things different. Wouldn't be the first time I made a mistake, and it sure won't be the last. A goof up may be hard to swallow, but it sure will be a lesson learned. When I get this new truck on the road next week and run it for a little while, I will see if what I did in spec'ing it out really was the right move. I'll be the first to admit, that I went outside the bounds of "normal" when I spec'd this one out.

    But it all can sure make the discussions lively!!
  9. j911brick

    j911brick Well-Known Member

    What are my numbers? I didn't post my numbers?
  10. KevTruckin

    KevTruckin Well-Known Member

    I'm Fleese to the bank! Lol!

    SBA loans r by far better option then lease to a company.

    But if u can cash!!
  11. j911brick

    j911brick Well-Known Member

    Sure, it can be for less than a buck a mile. In fact it could probably be done for 30cents per mile. But why would you? just because you can do it for less doesn't make you a better businessman.
  12. Copperhead

    Copperhead Well-Known Member

    It has more to do with what is at the other end. One person's operation gets, say $2 a mile, and another operation gets $1 a mile. But in the final analysis, they both end up with the same money in their pocket.

    It is true, that one doesn't have to haul for a buck a mile, but to do so, requires that they also change their operation so they have to shoulder more of the cost to do business. I really don't give a rip about what someone makes at the front end. Impress me with what they actually keep at end of it all. Just like I am not impressed with what Boeing Aircraft makes, I am impressed with what Boeing has at the end of it all. You can make $10 a mile for all I care, but if your net at the end isn't better than mine, I have no desire to do what you do to get the rate you do.

    If I can net $70K a year hauling for someone who is paying $1 a mile base rate plus FSC, and is handling all the heavy lifting doing load booking, IFTA filing, FMCSA compliance issues, negotiating shipping contracts, negotiating fuel discounts, etc., then tell me why I would want to net $70K a year getting a higher rate and having to also invest my time and effort, and the associated increased costs, into doing everything the carrier is doing for me? Seems kinda stupid. Now if one can work the numbers so that their net is substantially greater by doing all this stuff themselves, then by all means, jump at it. But, as I stated, impress me with the net on what you are making, not the gross.

    Then you can show me how great a businessman you are.
  13. ultralucky

    ultralucky Member

    I wouldn't be eating it out of a walmart bag. You don't know where that bag has been.

    Sent from my LG-P925 using Tapatalk 2
  14. Racer X 69

    Racer X 69 Member

    All this talk about lease operators, owner operators, company drivers, what they make and what is good and what is bad has had me sitting on the side, watching, listening, learning.

    The load I am under right now is one of two loads originating in Boaz, AL and ending in Tacoma, WA, about 2600 miles. I am a company driver getting mileage pay, and because it is an oversize load I am getting a few pennies a mile more, .10 a mile more I think.

    The other half of this load is on an owner operator truck that is "leased on" to the company I drive for. That driver and I loaded at the same time yesterday, and have been running together. We stopped for lunch yesterday and talked a bit about what loads pay. He told me that this load pays $10,000, and he gets 80% of that.

    So he is getting about $3 a mile, and from that he has to buy oversize permits (about $100) and fuel (he guessed about $1,000), and some other stuff the company handles like the insurance, IFTA, etc. I think he also sets some money aside for maintenance, and repairs.

    So he is doing OK for 4 or 5 day's work.

    He also told me that since he signed on with this company in March he has taken home about $100,000.
    • Like Like x 1
  15. Duck

    Duck Quack Supporter

    There's a difference between leasing "TO" a carrier and leasing "FROM" a carrier.

    My company has no lease program at all, ... yet all of our O/O's have "leased to" on their truck above the company logo.
    • Like Like x 1
  16. j911brick

    j911brick Well-Known Member

    That's some pretty good duckies. Is it his own trailer? Did he have to pay for escorts? was that the gross pay, or net to the truck?
  17. Racer X 69

    Racer X 69 Member

    It is his own trailer. O/O's that use company trailers get 75% of what the load(s) pay.

    This load is 12' wide and since there is no construction along the way requiring detours on narrow roads escorts are not required. If pilots are required that would be the responsibility of the O/O.

    I described the breakdown of the funds in my original post.
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