FIGURING COST PER MILE

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First I want to say Thank You for being someone I can count on to be moving freight across the country.  You are out there day after day in unbelievable traffic and weather conditions for the benefit of every man, woman and child in the United States and abroad.  You are unappreciated and wanted to say a heartfelt Thank You, I appreciate all that you do for me and my family.

With that said ……….

FIGURING COST PER MILE

Figuring your cost per mile is not that hard at all, just a little brain power needed.  There are also books you can buy to help you with this or you can save your money and do it the old fashioned way with paper and pencil or calculator.

Things that you need to consider to figure your cost per mile are monthly business expenses:

Truck payment (for example $2,000)

Trailer payment (for example $750)

Insurance for truck / trailer (for example $300)

Fuel (average per month) (for example $8,000 - running 8,000 miles in a month and getting 5 miles per gallon X $5 a gallon for fuel)

Mobile phone bill  (for example $100)

Meals  (for example $450)

Motel (for example $300 unless you spend ALL your time in your truck)

Oil change + (for example $100 - $200 per time X 6 times in a year divided by 12)

Tires (for example $525 - replacement of all 18 tires on truck / trailer in a year at a cost of $350 each.  Divide that total over 12 months)

Misc truck / trailer maintenance (for example $150 - This would include running lights, truck washes, headlights, air filters, etc.  Again take this annual total and divide it over a year for a monthly cost)

Now for some of these items that are not a monthly expenses you will want to take a yearly total and break it down for a  monthly expense.  Oil changes and tire replacement don’t happen every month, but they do need to be planned for.

Now that you know what your monthly expenses are, divide your average monthly mileage into your monthly expenses.  

Using the example above,  the expenses total  $12,125 per month.

Using the figure of running on average of 8,000 miles per month.

Dividing your mileage into your expenses, you get $1.52.  This is what you need to be making per mile to cover all your monthly expenses.  

Now this is just an example.  You decide what your monthly expenses are and how many miles you run in a month with your truck, but you get the idea.  Knowing this figure helps you decide what loads you may want to take a pass on for hauling and the loads you really want to get.  Don’t be afraid to negotiate either.  Sometimes there is some flexibility on what the broker is willing to pay for you to haul the load.  If you don’t ask you could be passing up some extra money that would go into your pocket.

 

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