How do you set your rates?

With the huge downturn the last couple of months, I've been thinking a lot as to how I set my rates. I really look at 3 things. $/mile all miles (from when I leave my shop until I return), $/hour (Again, from when I leave my shop until I return), and Loaded $/mile. I have been pulling a flatbed, and I'm based in northeastern Ohio. I have a couple of dedicated loads I work on, and pull everything else off the loadboards. That has gotten to be pretty slim lately. I only go out 2-3 days a week. I farm as well, so I run the truck between working the farm. Rates have been lower than I normally like to run, and I don't want to contribute to the cheap rates, but my equipment is paid for, and I run a 350 mile circle from home, so my costs may be lower than yours.

Here is what this year is shaping up to so far. Up until yesterday, I have ran 92 loads. Driven 28669 miles, 22234 miles loaded, 6435 empty, so 22.4% of my miles were deadhead. My average loaded income was $4.64/mile, and $3.60 on all miles. I have logged 948 hours in the truck, and averaged $108.81/hour. I pay myself 35% of the loads for driving. However, I do not pay for any maintenance work that I do. I do most of my repairs myself.

Earlier in the year I was hitting $3.70-3.80 on all miles, but lately that has dropped closer to $3, with some being in the $2.50-2.85 range. I figure my breakeven cost at $2.20/mile on all miles. I do need to refigure this, though, as there may have been some slight changes.

I know that there are some owners out there that believe that you can't run a business just off the loadboard. I have made some good contacts with brokers that I get loads from now that never get posted because when I take a load, it's there on time, and they never have to work on it. I just wish there were more brokers out there that I could form a closer relationship with, and that values my word more than these corporate guys. I've never cancelled a load in over 300 bookings, and was only late on 1 delivery due to a breakdown, which wasn't a problem, just rescheduled. I run off the loadboard because my business needs flexibility, and I don't think that I could service a direct customer day in and day out, every week, without having to pass on some loads here and there.

I'm thinking about adding an end dump to the fleet. I need to work on some contacts to get some work. Just trying to keep on the front side, and keep the truck working.

I'm curious to see where other owners are hitting. If this is too much info to put out there, let me know and I'll edit my post. Just trying to see where the rest of the industry is, and if I'm trying to get too much, or if I'm just wishing for better rates.

 

I generally tell myself I need to make $2500/week or $10k/month. It used to be that I wouldn't take a local load (under 200 miles round trip) for under $750. That's dropped to $600 lately, and sometimes even less. Not sure how these shippers can post a load at $200-300, especially when you know they're going to take 2 hours to load you. I don't mean to be smug, but it's not cheap to turn that key to start.

 

I have a hopper bottom I use during harvest to haul my grain to the elevator. I hauled a whopping 6 loads with it last year, and it has been parked since last November until this past week. But I have to have it. Have to be able to dump the combine when we're harvesting, and sometimes that takes longer that I think it will. Hopper is steel, and is starting to get rough, so I'm thinking about selling it and buying an end dump. Thinking I'll get some more use out of it. Currently working on doing some research to see what loads are around. Not planning on putting a driver on. Really don't want the headache. I find and book my own loads, and do billing too, so not sure I could handle it all with another truck at the moment. The really local flatbed stuff that I was doing, and could make a day trip out of has really gone away for a while. On my regular run, sometimes the mill doesn't have material, so we won't have a load for a week or 2. Can usually pick up another load going somewhere else from the same shipper, but the rate on those runs are a good but less than what I usually get.

On another note, I've kicked around talking to a dispatch service, but not sure any of them would have any direct freight. Requirement would be English as a first language. I know there are a lot of one truck businesses out there, but I just don't think that I could service another steady direct customer. Just looking to add a few more tools to the old tool chest.