Make More Money in RV Transport - 5 MORE Things to Know

When looking at what it takes to make more money in the business of transporting RV's, it would be great if there was one fail-safe, fool-proof fact that would be like a switch between making a killing and slowly putting yourself out of business.  Unfortunately (and like so many other things in life) the answer is more complicated, with more nuances and comes down to experience and discipline.

This article follows in the series on how to Make More Money in RV Transport, and expands on the previous "5 Things to Know" article.

These are good beginner articles to give a prospective driver an idea for what to keep an eye on, as well as a good refresher for the long-time trucker that just needs a quick reminder.

Two words to describe this list might include "planning" and "frugal".  Most of the time when people think of self employed they think of sunny and sandy vacations while other people do the work.  Have you ever heard about the cheap-skate though?  You know, the one that has so much money but won't spend it?  Some people are critical of that approach while other say that habit is the reason they have money to begin with and they spend their money where it is most effective instead of just throwing it around.

I tend to agree that it is a habit that perpetuates itself.  When you work in a service industry measured in time, and where time is money, frugal habits are what make the difference.

5 MORE Things to Know

The Truth Behind Backhauls - Considering Time and Money in Backhauls

In the first article we defined what a backhaul is, as opposed to a linehaul.  The purpose of this was to classify a haul more by it's character than by what someone else might be calling it (in other words, just because someone tells you it's a backhaul doesn't mean that it is).

This article will build on that and get another layer deeper in breaking out the different components of a haul and help you to calculate your costs.  I understand that some don't want to break things up into pieces, run the numbers and see what they come up with.  I've found that it's a good way to pass the time and keep the mind sharp - but it will also help you either make better use of your time, or simply make you more money.

To begin, let's look at the different parts we will assess and evaluate.

1. Deadhead miles to home base (Std Deadhead = SD).  In RV transport from manufacturer to dealer, this is the second half of the trip.  This is the half of the trip that you don't get paid on.  You need to use this as a baseline for comparison purposes.  You'll need to look at time and costs to compare with your other options.
2. Deadhead miles to backhaul pickup (Pickup Deadhead = PD).  No matter the direction, this is the miles from your outbound delivery to the backhaul pickup point.
3. Loaded miles on backhaul (Loaded Backhaul = LB).  Again, no matter the direction or number of miles, our calculations will account for these appropriately.
4. Deadhead miles to home base after backhaul (Delivery Deadhead = DD).  This is self explanatory and may include back-tracking if you go past home base..

We are going to answer the following questions when it is all said and done.

• How much will be in my pocket - will it be better to deadhead or backhaul?
• Will it take too long - would I have made more money by deadheading and taking another load?

Make More Money in RV Transport - 5 Things to Know

This, the third in the series How To Make More Money Per Mile Now, is a listing of 5 common things to know for a more successful career (or hobby as it may be) in the RV Transport industry.  There are actually 10 in the list, but to make it easier to read through, there will be a follow up article (5 MORE Things to Know...).

These are good beginner articles to give a prospective driver an idea for what to keep an eye on, as well as a good refresher for the long-time trucker that just needs a quick reminder.

The first two articles of the series How To Make More Per Mile included Fixed Costs (part 1) and Knowing Your Break Even (part 2).  As costs change over time, the specific numbers in those calculations and this article become outdated, but the concepts remain relevant.  So, make sure you don't get hung up on the numbers, looking instead to the conceptual aspect of each item.

For now, let's get to the first five in the list.

5 Things to Know To Make More Money in RV Transport

1. MPG = Knowing your Miles Per Gallon, both loaded and empty, is one of the most important factors of driving.  While MPG can vary greatly  depending on the weather conditions and size, shape and weight of your cargo, you need to know what your MPG is short term and over the long haul.
   

The Truth Behind Backhauls - What Qualifies as a Backhaul



Did they tell you the backhaul was an airplane?

There are as many views on backhauls as there are on politics and religion (What's the old saying, "never bring up politics or religion"?).  If you're hauling single RV's then you know it's just as important to know about backhauls as it is any other aspect of RV transport.  But with so many different opinions it can be difficult to determine if you are doing the right thing by coming back empty, routing to another part of the country or getting a load coming back to the Indiana (or where ever your point of origin).  We'll lay out some of the opinions and throw some facts in there to clear things up for you.

By the time you finish this series of articles you'll have the information you need to be assured that you're doing the right thing when it comes to backhauls.  You should also be able to articulate why you are doing it and how much it is making you (or costing you, as the case may be).

First - let's define backhaul as applied in the world of RV transport - What Qualifies as a Backhaul

This is where the first debate begins, as some drivers say, "there is no such thing as a backhaul, all loads are

How To Make More Per Mile Starting Today!! - Part 2

In the last post, Part I of HTMMPMST!!, the topic was fixed costs and the old saying “If your wheels aren’t turning, then you aren’t earning”.  In Part 1 the examples and concept demonstrated how disciplined, steady driving can spread the fixed costs over more miles and leave you with more of the per mile pay in your pocket at the end of the day.

Part 2 will cover the areas of knowing your break even point as measured by miles.  This is critical information to know as it indicates the minimum number of miles you need to run to keep your head above water.  All miles after that, are your "in the money" miles.

The break even point involves two components of cost:  Fixed Costs (as defined in Part I) and Variable Costs.

We will need to look at these three areas to get to our break even point.

1. Fixed Costs (covered in Part I)
2. Variable Costs (calculated below into per mile costs)
3. The Two Part Formula

Variable costs are those costs that accumulate when you are on the road and include fuel, meals, motels, maintenance and any other costs you incur.

Let’s look at converting variable costs into a per mile rate

Fuel:  Let’s say your fuel costs $3.30 per gallon.  Let’s also say that you average 15 miles to the gallon.  To calculate your cost of fuel per mile, you divide $3.30 by 15 mpg = $0.22 per mile.

• Fuel Costs / Miles Per Gallon = Fuel Costs Per Mile

  Let’s say you spend $18 per day on meals (includes cooler which is smart to do), and you run 600 miles per day.  To calculate your cost of meals per mile, you divide $18 by 600 miles = $0.03 per mile.

Driver Shortage - Is History Repeating Itself?... Again?

Last year RV transporters were pulling out of yards with a units that had already been on the transport company's lot in the range of a month or more, especially if they were headed North across the border (see March 2010 RV Business article "RV Transporters Cope with Driver Shortage" where Classic Transport reported having a 6 week backlog).

All transporter companies were in about the same shape, plus or minus a couple of days, because the manufacturers were self regulating dispatches based on which transporter was the least number of days out in addition to which ones could get a hot unit delivered first.

If that sounds familiar, one only needs to look back to May of 2007 to an RV Business article outlining the same situation, but for different reasons according to the transport companies ("RV Transport Firms Encounter Driver Shortage").  In that article, the source stems from the tidal wave of new drivers to the industry in order to move the Katrina FEMA units (you all remember those don't you - money through the nose with DOT waivers for all applicable regulations... that may be a slight exaggeration, but you remember).

After the FEMA units dried up, there was the natural decline of the industry in the second half of the year which spread the units too thin across the over-abundance of drivers leaving many with only one option - get out of the RV transport business.

In 2007 the RV transport companies realized they were in the midst of an unexpected driver shortage, but not in time to affect change.  In addition to laying some blame on the inability to support a large enough base of drivers during the slow period, there was also the aspect of fuel costs.  The manufactures were slow to respond to the rising cost of fuel which resulted in the inability of drivers to operate profitably.

How To Make More Per Mile Starting Today!! - Part 1

One of the most debated topics among drivers in all of RV Transport is if one can truly make any money doing it.  There are many who say it is a great hobby if you don't need money.  There are others that say it's a great hobby if you have extra money to put into it.  Then there are those saying that they make a living at it.

Then the question becomes, just because they say they make money doesn't mean they do make money.  Besides, when you're at a fuel stop or catching a meal talking to the guy next to you, how many times have you heard that his company is paying him $0.15 more per mile than you are getting - only to call his company for a job and find out that they are paying $0.05 per mile less than you are getting.

Trust But Verify!

With that fresh memory in mind, I asked for help.  When talking with drivers that said they made good money, I asked them to walk me through it.  If they are making good money then they must know the "how" behind it all, right?

After weeding through the one line answers like "well, I only go to _______ " (insert location of choice - usually not Canada or East), I did find some who could actually walk through the math side of it.  That birthed this series, "How To Make More Per Mile Starting Today!!"

Driver Shortage - What Will it Mean for You?

The RV industry is showing signs of another year-over-year improvement with anticipated volume growth in 2011 (Wall Street Journal).  The final step in getting units to the dealers is just as important as any other when it comes right down to it.  If all else comes off without a hitch, RV transport companies do not want to be the bottleneck that breaks the system.

Looking at the transportation industry prognostications for 2011, I fear that is exactly what is going to happen.

Driver shortages are being predicted in the "truck driving" industry - generally referring to Heavy Duty

What is Fueling the Fire? – Diesel Prices on the Rise

Diesel fuel is almost $0.50 per gallon higher December this year over last. That is nationally as well as by region across the country (U.S. Energy Information Administration). The first question is always, “What does that mean for you?” while the second question inevitably comes… “Why the increase?”

The answer to the first question is simple – whoever bears the cost of the changing commodity comes out on the short end of the stick. As they say, $%@# flows downhill, so the majority (but not all) of the time it is the driver or carrier as they are at the end of the food chain. There is, however, a wide range of debate over the answer to the second question of “why”.

One consistent message being reported around the world is “distribution margin increases”. This is the easiest to understand. The price goes up so the distributors can put more money in their pockets. This is in addition to the price per barrel cost increases, so now we conclude that there are multiple components to the answer (no great surprise).

The message here in the US is that the ban on drilling in the Gulf of Mexico by President Obama has weakened our domestic supply resulting in the cost per barrel

Tis the Season! (to start the dreaded RV cycle again)

Here we are again, approaching the holiday season and the time of year that brings uncertainty to the RV world.  Lake effect snow, chain laws, road closings, bridge closings, wash fee changes (Dealer: "I know I told you to pay the wash fee instead of washing the unit, but the unit shouldn't be dirty either!").


It is the beginning of the winter season and all that comes with it.


What comes with it, you ask?  Well - that all depends on your perspective.


The manufacturers are preparing for the year-end push, if it isn't already underway.  This is that great time of year when everyone from sales coordinators through company Presidents are doing all they can to get the dealers to open