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.

RV Transporter Blog Gets Facelift

We've had some great feedback on the site.  In the first month we've had visits from 6 countries and 4 continents!  Below is a description of some changes we've made as well as links to some of the articles.

If this is your first visit then you won't care about the face lift and you can move directly to one of our posts - See below for some categories to get started.

For those who have been here before - we've added some interactive bits for feedback including:

• Reaction - you can now give us your reaction to each article (like? dislike? interesting?... etc)
• Rank - you can now rank the article from 1 to 5 stars, we will later add a listing of highest ranked articles for easy access.

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!!"

Quality Drive Away - Why They Restructured

As midnight, January 1^st brought cheers of “Happy New Year” from around the world, it also brought new life to a local icon in the world of RV Transport.

Quality Drive Away, Inc. announced a restructuring of the two companies, including Baker Transport out of Fitzgerald, GA, that would change leadership and segregate duties. As of January 1^st, 2011 Quality Drive Away will encompass the motorized freight while a new entity, Foremost Transport, Inc will encompass all other freight (see article in RV Business).

In most circumstances, there are three reasons for such a restructuring:

1. Legal (regulatory, shielding liability… etc)
2. Accounting (taxes, financing…etc)
3. Succession Planning