3 Ways to Increase Business Efficiency as an Owner-Operator
Given the current market conditions in transportation, we know times can be challenging. One thing we know for certain is that being an individual owner-operator, or a trucking company, comes with many expenses that we accept as unavoidable. But there are three ways to ensure you operate most effectively and weather the storm:
- Protect your investment
- Invest in areas with a rapid ROI
- Effectively manage your expenses
1. Protect your investment
When it comes to managing your business, every dollar is an investment. Whether you are investing in equipment or technology, your eyes should always be focused on what’s ahead on the road—both the expected and the unforeseen. The difference between someone who enters the business and flames out in two years and the smart businessperson who is still trucking thirty years later is in operating in a smart way and protecting their investment.
What is one risk drivers are almost guaranteed to experience yet may not plan for? Citations. Professional drivers take on a significant risk by being on the road day in and day out, rain or shine, but most often the risks to their CDL—and their livelihood—are preventable legal risk.
Every driver you speak to will say they are a safe and responsible driver, but citations happen even to the best of drivers. A single stop can result in multiple violations. On average, one citation can cost a driver up to $2,000 in legal expenses if they choose to fight it. Add to that the lost earnings from down time related to appearing in court and lost revenue opportunities, and that driver is now looking at closer to $10,000 for a single citation. When margins are tight, any driver could be out of business over an avoidable experience. Choosing not to fight a citation could put you out of business even sooner. What is a truly good, responsible driver to do? The answer: think ahead and plan for the unexpected. Just as you would plan for tires or fuel, you need to plan for your legal needs as a professional driver.
2. Invest in Areas with a Rapid ROI
When the difference between you and any given load is having an operating truck, it is important to minimize downtime and ensure you have a reliable way to generate income. This is where effective vehicle maintenance is critical. You cannot afford downtime, so investing in maintenance is the best way to invest in an area with a rapid return.
Being proactive and intentional about maintenance is key, but it is also important to leverage discounts and plan how you can save costs. This is a significant area of expense for professional drivers. Look to join membership programs that provide access to discounts on parts, maintenance, tires and more to help you stay on the road as efficiently and cost effectively as possible.
The most effective business owners plan for the unexpected. Planning to prevent downtime is one of the best ways to invest in an area where you will experience an immediate and guaranteed return on your investment.
3. Effectively Manage your Expenses
Expenses are the one thing you are guaranteed to experience in trucking. While we may accept that some expenses are just the unavoidable cost of doing business, the smart business owners and operators will look for creative ways to cut costs without cutting productivity. When every dollar counts, it is the frugal businessperson who makes it through tough times, and there is no time like the present to start learning tips and tricks.
Let’s start with the top known expenses for professional drivers:
- Fuel: Most in the industry would agree that fuel is the #1 guaranteed cost of doing business in transportation. However, all things are not equal in fuel consumption. Experts agree that responsible and consistent driving patterns result in the most efficient fuel consumption rates. It’s important to be sure you monitor your driving habits to best manage your fuel costs. Beyond that, consider the fuel discount programs available to you through pre-paid and credit fuel card options in the market today. From cents on the gallon to upwards of a dollar per gallon, the savings can be significant.
- Maintenance and Tires: It has long been established that maintenance and tires are significant costs an owner-operator can expect. On average, they account for at least $15,000. Therefore, every dollar you save with the maintenance of your truck is impactful toward your bottom line.
- Taxes: For professional drivers, taxes are a real and present burden, and every driver deserves a tax professional in their corner who speaks trucking and understands the unique aspects of owning a business on the road. There are aspects of living life on the road that can be used to your advantage when it comes to taxes, so find a professional who understands trucking.
- Insurance: Managing your business includes managing your insurance coverage. While insurance is necessary and unavoidable, there are ways to reduce your rates and ensure that you have the most efficient and cost-effective coverage available to you. There are options available to you in the short-term and long-term.
- First, don’t take the first rate offered to you. Shop around and know your options.
- Second, pay attention to the long game. Managing your CSA score can help you secure better rates in the future. Even if your record isn’t the best today, leveraging your options to improve your CSA score can directly impact your future rates.
- Not sure how to start? Seek the advice of a CSA professional who can help you understand your score, risk factors and ways to improve your score in the future.
Apply What You’ve Learned
Making mistakes is part of life, but preparing for known obstacles can make the difference between barely surviving and thriving in this industry. When it comes to managing your business, protecting your investment, focusing on areas with rapid return, and managing your expenses are key. Avoid the risk of doing nothing. Find partners and professionals you can rely on and in whom you can place your trust, and you will weather any storm that comes.
TVC Pro-Driver has helped fight over a million citations on behalf of our nation’s truck drivers with a 92% success rate at reducing or dismissing citations. Not only does this have a positive impact on a truck driver’s bottom line, but it will also allow you to focus on driving, having the comfort of knowing that TVC Pro-Driver’s network of attorneys has you covered. When you’re considering areas of your business to invest in, any investment you can make in protecting your CDL and your livelihood should be your number one priority.
They offer full CDL protection, commercial benefits, and driver rewards as well as the TVC Fuel Card that can save you $185 a week. You’ll have access to top-rated trucking attorneys who will handle all of your new tickets and violations for $0 out-of-pocket cost, saving you thousands of dollars and avoiding court time.
The Truckstop Partner Blog occasionally publishes articles contributed by Truckstop Partners as a service to our community. The views and opinions expressed in these articles are solely those of the contributor. Truckstop is not responsible for and does not verify the contents of the information or claims contained in partner supplied blogs.
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