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Gary

Your Minimum/Traget Rate Per Mile.

This is a subject I think more Owner Operators need to think about.

This is the way I get to a minimum rate per mile. This information may help some of you out there? If your a experienced Owner Operator who's figured something out that works better, great please share it with us. This information is mainly for the newbies that haven't given this much thought yet, or even the Owner Operator thats been at it for awhile who's not having much luck.

I always go for the most money I can get for each of the Owner Operators I'm dispatching (Within Reason). I won't ask for a ridiculous rate because I know it can do more damage then it'll do good. How is that you might be asking? You see if you get a reputation for asking for ridicules rates Brokers and Shippers will stop calling you. When that happens being a Owner Operator becomes very difficult. Over the years I've just found that if you treat most Brokers and Shippers fair they keep calling you.

If you were to look at our rates per mile in a week, month, or year you may see rates ranging from as low as a $1.40 per mile to as much as $3.00 a mile with every possible number in between.

I feel the way a Owner Operator should look at it is if he hauls one load 1000 miles paying lets say $2.50 a mile and then all he can find for a reload is $1.40 going 1000 miles he shouldn't necessarily turn that load down just because it doesn't meet his minimum/target rate per mile. The reason is, if you put the two loads together and divide them by the total miles it's not a bad average rate per mile. The average between these two loads is $1.95 per mile. For a hotshot, thats a very respectable average rate per mile.

Of course there is other things you'll need to consider before grabbing this load. Things like origin, destination, weight, and size of the load are a few that come to mind.

The point I'm trying to make is there might be another way for you to get close to, and even go beyond your minimum/target rate per mile.

I see new Owner Operators who dig their heels in and refuse loads offered to them for just a few cents under their minimum. They rarely give any consideration to the loads they hauled prior that paid them 20, 30, 40 cents, or maybe a $1.00 per mile over their minimum. To me it just doesn't make any sense. You see if you put a load thats just a few cents below your target rate with one, or even a few other loads that paid over your target rate your still meeting, or even exceeding your goal by taking this load. Not to mention this way of thinking may allow you to run steady all year long.

I'm not saying to run for less then your operating cost here, operating cost is something totally different. Please don't confuse the two. Your operating cost is what it takes to run your truck, your minimum is what makes you a profitable Owner Operator.

Over the years this is how I ran and I always earned a very decent average rate per mile. Hopefully this information will help some of you do the same.
billyboy21

What is a good formula to figure your operating cost?
Gary

You need to add up everything it costs to pay for and maintain the truck in ready to roll condition. Things like Fuel cost, insurance cost, maintenance cost, licensing cost, ect, ect.

Base these figures on 8,000 & 10,000 miles per month.

I'll get more into it a little later, real busy this morning.
espressolane

Go to the OOIDA web site

I think it is in the "tools" section

Look for the cost of operations spreadsheet.

You can download that one for free.

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