Establishing an effective hauling rate can be tough. You want to make sure you’re profitable while still setting yourself up to land jobs. To make matters more complicated, there are varying factors that go into setting a hauling rate. But what goes into that number?
We’ve put together some helpful tips to consider the next time you’re bidding on freight.
- Is Your Hauling Rate Correct?
There’s no blanket answer to this question because hauling rates will be affected by the area of the carriers, the lanes in which they operate, the type of freight, and so on.
However, some general guidelines can definitely serve you well when trying to decide on your haul rate for a load.
- Initially, you should define what it costs to provide your level of service. This will be the best starting point to ensure you’re hauling rate is in a good and profitable place.
- Fixed Costs:
These are the expenses that occur regardless of whether your truck or fleet is on the go. Truck payments, insurance, base plate, office rental, and the like are all great examples and are typically calculated by the day, week, month, quarter or annually.
- Operational Costs:
These are the expenses related to the time your trucks are moving. Truck and trailer maintenance, repairs, tires, per-mile driver pay, etc.
- Fuel Costs:
Because this is one of the most substantial expenses of any operation, it’s usually figured separately. You should figure out fuel cost on what it will cost on a specific load rather than relying on a fuel surcharge. This cost is also calculated by the mile.
- Load-Specific Costs:
load has distinct costs that don’t apply to every shipment. Examples include
tolls, pilot cars, special permits and driver pay.
With these considerations in mind, you should also think about and define the capital required to sustain your operation when revenue doesn’t meet costs as well as the amount of money needed to grow your company’s net worth.
All of this information will make establishing a hauling rate that much easier. And, it will allow you to obtain the revenue needed to reach your goals.
- Why It Matters
- When your hauling rates aren’t set correctly, your business suffers. Year after year, carriers struggle with cash flow, even when business is good. When moving loads for trucks, it’s important to know if it’s worth your time and energy to fire up your truck.
- Taking the time to calculate a proper hauling rate will go a long way in your trucking success.
- Beyond fuel and time on the road, there are so many other expenses to look at when figuring out what to charge to move truck loads. By knowing all of your fixed and variable costs and how to account for fluctuations, you can calculate a hauling rate that will keep you profitable for many years to come.
FreeFreightSearch.com has registered over 88,000 motor carriers and brokers and has posted more than 131 million loads. Also, FFS is the first and only load board that is fully integrated with a freight bill factoring company, meaning that registered members may find freight, obtain a fuel advance, and obtain 100% funding within hours of delivery – without ever leaving the site. Sign up for access today!