Are Trucking Companies & Businesses Profitable? (7 Tips)

Yes, running a trucking business as a solo owner operator or by owning a trucking company with your own fleet can be very profitable if you take careful consideration of the work you take and the numerous cost factors involved.

Are Trucking Companies Profitable?

If you are working for a trucking company, chances are, if it’s still in business then it’s working enough.

But if you are looking into having your own trucking company in hopes of making serious money, there are many factors you need to consider.

The trucking business is very profitable and you can do very well or very poorly, depending on where you stand in the following:

• Are you willing to work diligently?
• Do you understand that more capital helps your chances of success?
• Are you willing to drive or not?
• Will you put up with hardships to make your money?

Understand that there are no universal standard costs and numbers in the trucking business. All the numbers will be based on your situation.

That said, you want to have an idea of what freight you want to handle, where you’re willing to run your freight, the capital you will enter and grow with, etc.

After you answer all of these questions yourself, you will have ballpark numbers and info you will be working with, such as:

• Available fuel programs
• Truck leasing/purchasing
• Warrant/condition
• Insurance cost estimates
• Time OTR (On-the-Road)

How To Make Sure Your Trucking Business Is Profitable

I’ve operated my own trucking company for plenty of years and here is what I have to say:

There are so many variables in the trucking business. This means that profits aren’t so cut and dry after you consider the cost of:

• Maintenance: an expensive repair can take your truck off the road and leave you at a net loss for a period of time
• Fuel: costs $50k per year per truck (plus or minus $10k)
• Insurance: can cost more-or-less $750/week; check out Lancer or Great West for single truck owner-operator
• truck/trailer
• taxes
• fees
• and so on.

You may get a nice lump sum of cash after delivering a load, but all of these expenses, including tolls, food, showers, makes the money go quicker than you’d expect.

All of this means that you can hit $180,000 in revenue in a single year, but after all the costs and taxes your profit will come out to around $75,000.

You must be able to profit at least $100,000 as a solo driver before you can really make a trucking company work. If you aren’t breaking the six-figure mark on your own as an owner operator, then you will be better off financially working under another company.

However, many owner operators don’t like being company drivers and rather take a lower income in order to avoid company rules, micromanagement, and keep a more flexible schedule.

Owner-Operator is a term used for an individual who is a contractor and works as their own truck driving business. They typically own and operate their own truck and manage the day-to-day business operations.

Trucking business owners who don’t drive will need to have ~5 drivers in order to replace the income they’d make if they were a solo owner-operator.

If you are trying to run a trucking company without being behind-the-wheel yourself, you need the consider the following difficulties:

• Finding drivers with a good work ethic
• Managing your drivers to prevent or handle mistakes
• Handling incoming expenses when a truck isn’t in operation

What you are hauling and the time of year also dictates your profits. For example, hauling rock, salt, and sand during the winter can be very profitable.

Understand that most carriers have an operating profit of over 90% which translates to around 10cpm or less.

CPM is Cents Per Mile and truckers are typically paid using this standard of measurement.

Helpful Tip: Most money you make is on fuel. It’s worth investing for the long-run—get what is reliable and fuel efficient. Most of the money you spend will go into fuel, maintenance, and repairs.

Set aside 30% for taxes as a rule of thumb. This is because as an owner-operator you will need to pay your taxes in lump sums.

7 Ways To Make Sure Your Business is Profitable

Like we teach in our trucking business training, there are several factors you must consider to ensure your company is profitable.

You must consider the scalability of your business. We teach you how to grow from a single owner-operator to managing your own trucking fleet in a way that maximizes profits. This is especially doable if you take an approach without high upfront costs or risks.

Understand the demand for your work. Since online retail and trade globalization is only getting bigger, your work as a truck driver is only becoming more valuable with climbing demand.

Take advantage of technology. Today is the best time to start a profitable trucking business because we have the power of technology on our side. Thanks to GPS routing, automated routing, and online payment processors, you are able to run your business much more efficiently in terms of speed, safety, and profitability.

Managing your costs. With experience and/or training, you can take care of cost management by optimizing your fuel efficiency, ensure documentation and legal compliance, and calculate your fixed and variable costs.

Maximizing revenue streams. Besides increasing your revenue via your cpm rate, you can also include freight handling fees and other services. Based on how you arrange these services you can ensure that you always come out ahead of any job you pick up.

Better operation management. The more efficient you are with your operations, the more profitable you will make your trucking business. This means optimizing the following:

• Driver Training
• Customer Orders
• Documentation
• Fuel Purchases
• Maintenance
• Etc.

Make sure you’re marketing. You keep work coming in by having a solid growth strategy. This includes advertising and attracting new talent. By doing this you will increase business leads and further expand your business.