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    3 Replies Latest reply on Aug 8, 2008 7:57 PM by trophytrans01

    Trucking Company

    trojans08 Newbie
      Hello everyone,
      Im in the process of building my trucking company and have a few concerns. My biggest concern is the effects gas prices are having on profits from each load. I was told by someone in this industry that gas prices do not effect the profits at all because as gas goes up, more gas money is provided. I would love it if someone with some experience in this business could help me out. Thank you everyone!
        • Re: Trucking Company
          LUCKIEST Guide
          Trucking Company, Welcome to this web site.

          You are in the process of building your trucking company??
          Where are you, like city and state?? What kind of trucking company??
          How soon do you plan on starting this business??
          Do you have an Accountant?? A Lawyer??
          Have you developed a Business and Marketing Plan??

          Who is this "someone" ?? That is why you need a Business Plan

          Good luck, LUCKIEST
          • Re: Trucking Company
            Tracker
            Hi,

            I have considerable experience in business (26 years plus), starting, buying & selling my own businesses. One of the businesses I bought, built up and sold was a trucking company (statewide LTL with my own equipment and TL interstate with owner-operators). You can see more about me in my profile.

            The person that told you that fuel increases could be passed on is talking about fuel surcharges. That is a very common thing in the industry and one that you should automatically implement. In your business plan's financial projections work out your true burdened cost per mile. This means factor in insurance, driver, equipment cost, equipment maintenance & repair etc. Add your profit margin to this so that you know what you need to generate per mile and that becomes what you quote for your loads (if you are an expedited carrier allow for any extra "hot shot" expedited costs you would incur, or if LTL you'd need to work up your cost-per-hundred-weight based on expenses and margin). And as you establish this is a benchmark ... then you quote a fuel surcharge (usually a %) that adjusts with the rise (or fall) of fuel costs.

            I typed the above out on the fly so I apologize if not clear; if you'd like to discuss directly or need some help with your trucking business, again feel free to look at my profile and contact me.

            Dennis Lowery
            Adducent, Inc.
            • Re: Trucking Company
              trophytrans01 Newbie
              I would agree with Dennis. I have owned a truking related enterprise for 15 years. The bottom line is to always remember that you are running a business, not just trucking. No matter how big or small, a fuel surcharge takes away the surprises for you and for your customer. This is the fairest approach to pricing. If you need to view a copy of a fuel surcharge, or need pricing advice you are free to visit our web site at www.trophytrans.com and locate our phone numbers. We are an active trucking company that is suffering the same fuel price shock as you are, but we have overcome it by istituting a fuel surcharge program.

              I wish you all the luck in the world,

              Robert