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What, exactly, is the definition of ‘cheap freight’?

I had an encounter with Mr. Supertrucker last week. I was running up from California and he came blasting by at around 5 mph above the speed limit.

I had an encounter with Mr. Supertrucker last week. I was running up from California and he came blasting by at around 5 mph above the speed limit.

An hour later he came by again, and a couple of hours later there he was again, hammer down in the left lane. He was driving a classic truck with all the lights and chrome.

It was a sharp looking truck for sure, but for one thing, a decal on the rear doors that read: “Say NO to cheap freight.”

A few hours later I pulled off to get some coffee and here he was again, taking on some fuel. I pulled into the parking lot and he parked next to me.

We got talking and I said I was going inside for a coffee. He joined me and we got talking about the job again.

I mentioned the decal on his trailer and he went off on a rant for five minutes about how people were running around for peanuts and ruining the job.

I sat back listening for a while and then thought I’d have a little fun, so I asked him what he considered to be cheap freight?

He stated that he never took a load that paid under $2 per mile. I then asked what he did if he was in an area without freight that paid that much?

He told me he would sit for a day or two and then if nothing happened he would deadhead to a load that did pay well enough.

So I asked him how much per mile he was earning sitting for up to two days in a truck stop? I got a frown, then I asked how much he got paid to deadhead?

Again, the frown. After a moment he started off again, this time about how people hauling ‘cheap freight’ made it so that he had to sit for two days or deadhead hundreds of miles.

I then explained that someone hauling the same lane he was deadheading for a buck a mile was earning more than him and he told me I didn’t know what I was talking about.

Before it turned nasty I decided on a different approach.

This time I asked him what his fuel mileage average was?

He didn’t know! I would say he was getting under 5 mpg as he was doing an admitted 5 mph over the limit everywhere and we were out in Utah with a 75-80 mph limit. On hearing this, he told me that it never mattered because of the fuel surcharge, so I asked him what figures the surcharge he was getting were based on?

Again, he didn’t know.

At this point I decided to give it up, as it would, no doubt, soon turn ugly.

Now here’s the thing, there is no one number that classifies a load as ‘cheap freight.’

If you have a $300,000 custom truck and trailer and tear around at 80 mph between stopping at truck stops every couple of hours and want to sit around waiting for the right rate for days at a time, then $4 per mile is not enough to turn a profit.

Yet an operator with an 8 mpg truck, that is bought and paid for, can make decent money at a buck fifty, so which one is hauling cheap freight?

In much the same way that you don’t need to win every battle to win a war, you don’t need to turn a huge profit on each load to make money.

In extreme cases you could even take a load that only just covers your costs (which you should know down to the last penny), which will take you to somewhere that will get you a good paying load.

For example, you get a good paying load from Winnipeg to Halifax. Once there you can’t find anything to take you back to Winnipeg, so you look at Montreal or even Toronto and there’s plenty of good rates coming out of both.

Now, you could deadhead to either one – your fuel mileage would be excellent so it would lower your costs – but it still costs you.

So if you can find a load that just about covers the fuel and your daily fixed costs that gets you to either city, you’re then back to the good rates and it never cost you anything.

You didn’t make money on that leg, but the next load that you run out west will, so by the time you get back to base, you’ve made a decent profit.

Where’s the cheap freight in that?

We live in a very different world than we did in the good ol’ days. Technology and many other things have made most industries more efficient, yet some within our industry are still using business practices from back in the day.

To earn a decent living today we need to focus on our cost of operation.

The days of charging a rate that would allow us to make money regardless of what it costs us to do the job are long gone.

We now need to control our expenses and operate as efficiently as possible.

That way we make money all the time, and when we’re lucky enough to pick up some really good rates we make even more and laugh all the way to the bank.

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