(The video above features cost-accounting tips in a discussion with Eric Harley of Red Eye Radio, ATBS' Mike Hosted and Overdrive contributor and owner-operator business coach Gary Buchs, from a talk at the 2023 Mid-America Trucking Show.)
Being able to survive and thrive as a business owner has as much to do with managing costs as it does with generating revenue. Like the chief financial officer of any company, you have to be concerned about rising costs, especially without increases in revenue. Trying to reduce costs, let alone make sense of them, can be a complicated task.
Understanding basic principles of operating costs can save you thousands of dollars a year:
The owner-operator who can save just one penny per mile over 100,000 miles driven annually will save $1,000 in a year.
If 9,600 miles are driven one month and 10,000 miles the next month, there will be two different sets of costs for each month. For example, if your tractor payment is $1,850 per month and you drive 9,600 miles in the month, your tractor payment will cost you 19.3 cents per mile. However, if you drive 10,000 miles, your tractor payment will cost you 18.5 cents per mile. This is one of your major fixed costs while paying off a truck loan.
