Business

If you’re an owner-operator or fleet manager, knowing how to calculate cost per mile for commercial trucking is crucial for maintaining profitability. Accurately calculating this metric gives you clear insight into your operating costs, helping you make smarter decisions, prevent losses, and grow your profit margins. Without this knowledge, you risk jeopardizing your business’s financial health.

In this article, we’ll explain why understanding your cost per mile is essential for effective business planning and provide a step-by-step guide on how to calculate it. This information will empower you to keep your cash flow steady and ensure long-term success for your trucking business.

Why It’s Important to Know Your Cost Per Mile

Calculating cost per mile gives you the data you require to plan and manage your business’s finances effectively. Specifically, it helps with the following:

• Profitability and Pricing: When you understand your cost per mile, you can figure out how much you need to charge to make a profit and set your rates appropriately.
• Budgeting and Forecasting: Knowing your cost per mile lets you accurately track operating expenses like fuel, meals, and lodging, helping you pinpoint areas to cut costs and save. This insight also allows you to allocate budgets effectively as your business grows, ultimately boosting profit margins.
• Decision-Making for Fleet Operations: Analyzing cost per mile helps you make informed decisions on load selection, route optimization, and mileage reduction, ensuring that each delivery is profitable and maximizes revenue.

Breaking Down Cost Per Mile: What You Need to Know

To calculate your cost per mile, you must understand a few fundamental business metrics. These include:

Fixed costs

Your fixed costs are the unchanging expenses your trucking business incurs each month. These costs remain the same regardless of the number of loads you transport or miles you drive. Common examples include:

• Truck and insurance payments
• Truck payments (financing)
• License plates
• Rent
• Salaries
• Annual permits and licenses

Variable Costs

Unlike fixed costs, variable costs change monthly according to the number of loads and miles driven. The more loads and miles you cover, the higher your variable expenses will be. Some of the most common examples of these costs include:

• Fuel costs
• Maintenance costs
• Utilities
• Tolls
• Tires
• Food
• Unloading fees
• Freight-related fees (broker, dispatching services, etc.)
• Miscellaneous expenses

Miles Driven

There are two types of miles to track when calculating cost per mile – compensated and deadhead or empty miles. Compensated miles are the miles you cover when you’re on your way to make a delivery.

Deadhead or empty miles are the miles traveled after completing delivery, and your truck is empty. You’ll have to track both miles to estimate your per-mile expenditure accurately.

How to Calculate Cost Per Mile

To get your cost per mile, divide your total expenses by the total number of miles driven, i.e.,

Cost per mile = Total expenses ÷ Total miles

Here’s a step-by-step guide showing you how to apply the formula above:

Step 1: Select a time frame for Making Your Calculations

The first step to making reliable cost-per-mile calculations is to choose a time-frame for computation. This will guide your data collection process and minimize confusion.

If you’re working out your cost per mile for the first time, it’s best to pick a shorter time-frame, say a day or week, so you’ll have less data to work with and fewer figures to compute. If not, select an extended period, preferably aligning with how often you track other business metrics. It could be monthly, quarterly, or semi-annually.

Step 2: Determine Your Fixed Costs

After selecting your time-frame, track fixed expenses within that period by creating a spreadsheet listing each item. Add up these fixed costs for your chosen period to get an accurate total.

Remember that some expenses, like license plates, may be paid annually. If you’re calculating monthly costs, divide any annual expenses by 12. For example, if your yearly license plate fee is $1200, this would equal $100 per month.

Fixed costs provide a stable base for budgeting and financial planning since they remain constant. Accuracy here is key to setting reliable budgets and making precise forecasts.

Finally, review your fixed costs, such as commercial insurance or license fees, each time they renew, as these amounts can vary.

Step 3: Determine Your Variable Costs

After determining your fixed costs, work out your variable costs for the chosen time-frame. Because these costs differ significantly from one month to the next, the best way to record them is to create a column for variable costs on your spreadsheet. Then, use receipts to list all the variable expenses for a given month.

You could also use other tools, such as a fuel cost estimator, to get accurate estimates for your fuel costs if you don’t have all receipts handy. Once you record all variable costs, sum them up to get the month’s total variable expenses.

Track and monitor your variable costs as accurately as possible. It will help you identify ways to improve your business processes, cut costs, and increase revenue.

Following the example above, it’s clear that fuel and broker fees are the highest variable costs. If you introduce fuel efficiency strategies into your trucking business and work to replace brokers with regular clients, you’ll significantly reduce your variable costs and increase your profits.

Step 4: Track the Total Miles Driven

You cannot calculate the amount you spend per mile without knowing the miles you’ve traveled during the chosen time-frame. Knowing how many compensated and deadhead miles you’ve covered in a month is straightforward if you have electronic logging devices (ELDs), or other software to help you keep track of mileage.

If you don’t have any systems, you can work out your total mileage manually by checking your odometer readings at the start and end of the month. For instance, your odometer may read 70,000 miles at the beginning of the month and 80,000 miles at the end. That means you covered 10,000 miles that month.

Step 5: Calculate Your Cost Per Mile

To work out your cost per mile, add up your total fixed and variable costs. Then, divide the total cost by the number of miles driven.

In our case, the total expenses will be—$2900 + $6530 = $9430 (I.e., the fixed costs under step 2 plus the variable costs under step 3).

The cost per mile is $0.943. That is the total expenses ($9430) ÷ the miles driven under step 4 (10,000).

Conclusion

Calculating cost per mile will help you evaluate your business’s financial health. It can also guide you to the correct business moves and make the most of your career in the trucking industry. You’ll know what to do, where, and how to keep your business costs low and profits high.

For example, when tracking your mileage, you can know the number of deadhead miles you cover and look for ways to minimize them. And because deadheading still uses fuel – the second-largest operating cost of trucking businesses – reducing dead miles will help you reduce fuel consumption, helping you to save and keep more money.

Our guide above will help you get your cost per mile in no time, but if you prefer a simpler method, consider using an online cost-per-mile calculator. For more tips you can follow to ensure your trucking business thrives, visit our blog.

Managing a small fleet can be challenging for any business, making trucking software for small fleets an essential solution. From tracking vehicle maintenance to organizing driver schedules, it’s easy to feel overwhelmed by the details. Fleet management software is designed to address these challenges, helping small businesses streamline operations, cut costs, and keep their vehicles running efficiently.

In this guide, we’ll dive into the key features and benefits of trucking software for small fleets and discuss how to choose the right option to suit your business needs. Whether you operate a delivery service or a small trucking company, this guide will help you get started with the right tools to support your fleet.

Understanding Trucking Software for Small Fleets

To understand the value of trucking software for small fleets, let’s first cover what fleet management is.

Fleet management is overseeing and coordinating all vehicles for a trucking business. For small businesses, this means keeping track of fleet maintenance schedules, fuel costs, vehicle financial management, dispatch management, and driver management.

Whether running a delivery service, a plumbing company, or a small trucking business, fleet management is essential for controlling costs and improving efficiency.

Small fleets in the trucking industry can vary, but they usually include commercial vehicles like:

• Delivery vehicles: Used by companies that transport goods, from small packages to larger items.
• Service vans: Common for repair businesses or contractors who travel to different job sites.
• Trucks: Often used by smaller trucking companies to transport materials, equipment, or products.
• Company cars: For salespeople or managers who travel frequently for work.

Challenges of Small Fleet Management

Managing a fleet without the right trucking software can be tough, especially as your business grows. Here are some common problems you might face as a small fleet manager:

• Maintenance issues: Without a system, it’s easy to lose track of when vehicles need repairs or routine servicing. This can lead to breakdowns, which cost time and money.

 

• High operating costs: Small businesses often struggle to monitor fuel consumption, repairs, and other expenses. Without knowing where your money is going, it’s hard to cut costs.

 

• Driver accountability: It’s hard to track what your drivers are doing, how fast they’re driving, or if they’re following safety rules. This can lead to unsafe driving and increased liability for the company.

 

• Time-consuming administrative tasks: Keeping track of mileage, driver schedules, and vehicle documentation manually can take up a lot of time that could be spent growing the business.

 

• Limited insight into fleet performance: Without clear data on how your vehicles are being used, it’s tough to make informed decisions about buying new vehicles, retiring old ones, or improving your fleet’s efficiency.

By using the right trucking software for small fleets, you can automate these tasks, get real-time updates on your vehicles, and make better business decisions. Ultimately, trucking software will help you cut costs, stay organized, and keep your drivers safe.

Key Benefits of Fleet Management Software for Small Fleets

Using the right software solution can completely transform your small fleet operations. Here’s how.

Automating Reports and Manual Tasks

Fleet management software automates reporting on important parts of the job, like fuel usage, mileage, load management, and vehicle maintenance.

Instead of manually tracking these details, the software does it for you. This saves time and reduces human error.

You’ll also eliminate paperwork to increase your operational efficiency. This means less time spent on repetitive tasks and more time to focus on more important work.

Streamlining Vehicle Acquisition and Disposal

Digital solutions simplify the process of buying, selling, or retiring vehicles.

Software can track the entire lifecycle of each vehicle, from the day it’s purchased to the day it’s retired. This helps fleet owners decide when to sell or replace vehicles, ensuring you get the most value out of your investment.

Compliance with Licensing and Regulatory Requirements

Fleet management software helps you stay on top of legal requirements like vehicle licensing, permits, and other necessary documentation.

It provides reminders for renewal deadlines, ensuring you avoid penalties or fines for late submissions. For example, your software could keep track of the international fuel tax agreement, and help you calculate this automatically. This can save loads of time and effort.

Not only does this save time, but automated tracking makes staying compliant far easier and less stressful.

Enhancing Vehicle Inspections and Emergency Repairs

The software schedules routine inspections for your vehicles, helping to ensure they stay in good working order.

It also makes it easier to manage emergency repairs by providing real-time data on vehicle issues. This reduces downtime and keeps your fleet running smoothly.

Improving Safety Standards

Monitoring driver behavior is an important part of fleet safety. Fleet management software tracks how your drivers perform, including speeding, harsh braking, or other unsafe practices.

This helps promote safer driving habits. It also keeps a record of safety violations and vehicle maintenance, ensuring compliance with safety regulations.

Increasing Productivity

With fleet management software, you can track driver productivity, optimize routes, and reduce idle time.

By using the most efficient routes, drivers can complete more jobs in less time. This means your vehicles spend more time on the road, generating income, and less time sitting idle.

Enhancing Customer Service

Better fleet coordination leads to improved delivery times and communication.

This helps ensure your customers receive their products or services on time. The software also allows you to provide real-time updates, which boosts overall customer satisfaction.

Boosting Profitability

One of the biggest advantages of fleet management software is its ability to reduce operational costs.

By optimizing routes and monitoring fuel usage, you can cut down on fuel expenses. Software can also provide data that helps you make smarter business decisions, which can ultimately improve profitability.

Assessing the Fleet Management Needs for Small Fleets

Finding the right trucking software involves understanding the unique needs of your fleet. To determine this, consider the size of your fleet and the industry you’re in.

A small fleet with just a few vehicles will have very different requirements than a larger one with dozens of vehicles. Also, different industries, like logistics or service-based businesses, might require specialized features.

For example, logistics companies might need features like route optimization, real-time vehicle tracking, and tools to optimize load distribution and fuel management. This all improves delivery times and reduces costs.

On the other hand, service-based businesses – like plumbing or electrical repair companies – will benefit from task management, scheduling tools, and vehicle maintenance tracking to keep their operations running smoothly.

By understanding your fleet’s size and specific industry needs, you can choose software with the right features to improve efficiency, cut costs, and enhance productivity.

Choosing the Right Fleet Management Software for Small Fleets: Key Features

Choosing the right software solution for your specific business can be tricky. Here’s what you should prioritize when considering different trucking software companies.

User-Friendly Implementation

For small business owners with limited tech expertise, ease of use is critical.

Fleet management software should have a simple setup process and an intuitive interface. A user-friendly platform makes onboarding quicker and helps your team start using the software right away, without wasting time on training.

Cloud-Based vs. On-Premises Solutions

Cloud-based fleet management software is far more cost-effective and scalable for small fleets.

It allows you to access data from anywhere, using any device. On-premises solutions are usually more expensive and harder to maintain.

Small fleets will benefit from the flexibility and low upfront costs of cloud-based options.

Integration with Existing Systems

Your trucking software should offer seamless integration with other business tools you use, like CRM or accounting software.

This prevents duplicate data entry, saving time and reducing errors. With integration, you can keep all your business operations connected and running smoothly.

Scalability

It’s important to choose a solution that can grow with your business. Look for software with flexible pricing models that adjust as you add more vehicles or need new features.

This way, your fleet management system can scale without having to switch platforms later.

Vendor Reputation and Support

A reliable vendor with good customer support is key.

Look for software providers with strong reputations, positive reviews, and case studies from businesses similar to yours.

Good support and regular updates will ensure that the software continues to meet your needs as technology evolves.

Budget Considerations

While cost is important, focus on balancing your budget with the features you need.

Look for options that offer free trials or flexible pricing, and avoid hidden fees. Over time, the right fleet management software should provide a strong return on investment by improving efficiency and cutting costs.

Conclusion

Trucking software is an important investment for any small fleet. Take your time to find the right solution that matches your business needs, and you’ll see how much value it offers over the long run.

If you run a trucking business or manage a fleet, acquiring new vehicles is one of the most important parts of your job. At Mission Financial, we make it easy for small fleets to access favorable financing solutions for purchasing semi-trucks. Get started to see how easy truck financing can be.

If you’re an owner-operator looking to take on more loads, then Amazon might be the answer.

Amazon Relay offers truck drivers a great opportunity to tap into Amazon’s vast logistics network, providing steady loads and reliable pay. Through the app, drivers can find and manage jobs, while the company’s regular demand ensures consistent work.

Whether you’re an owner-operator or part of a fleet, Amazon Relay can help grow your business with quick payments and no load minimums. However, it’s not without its challenges.

Let’s explore everything you need to know to decide if Amazon Relay is the right fit for you.

Amazon Relay Overview

Amazon Relay is a platform that connects trucking companies, also known as carriers, with Amazon’s vast freight network. It’s a kind of relay load board designed for Amazon.

It allows carriers to find and book loads easily using the Amazon Relay app, which offers features like fast payments, real-time tracking, and load management.

Through Amazon Relay, carriers can access thousands of shipping loads, secure short-term contracts, and receive rewards like fuel discounts and early access to loads. It’s designed to help fleet owners and drivers grow their businesses with flexible options and convenient tools for managing freight.

If you’re an owner-operator or run a trucking business, Amazon Relay is a convenient load-board app to help you find and execute loads. It’s especially useful if you own a box truck.

How Amazon Relay Functions

Are you considering using the Amazon Relay load board? Here’s how the process works for Amazon Relay drivers.

Load Board Access

Amazon Relay offers carriers access to its load board, where they can find a wide range of shipping opportunities.

The load board shows real-time listings of available freight, making it easy to find and book loads that fit your schedule. As an Amazon Relay driver, you can also see important details, like the load price, distance, and delivery times. This helps you choose the best options for your business.

Short-Term Contract Options

For carriers looking for more predictable income, Amazon Relay provides short-term contracts.

Amazon Relay program contracts allow you to secure multiple loads for a fixed period, like one or two weeks.

This helps ensure a steady stream of work and is a great way to reduce downtime, giving carriers the ability to plan and budget more effectively.

Truck Posting Process

Amazon Relay simplifies the process of booking loads through its “Post a Truck” feature.

Carriers can create a Relay account, post available trucks, and their interior cargo dimensions, and specify their preferred routes. Then the system will automatically match them with suitable loads.

This helps minimize empty miles and maximizes efficiency by keeping your trucks on the move.

Types of Loads

Amazon Relay supports a variety of load types and truck classifications, including box trucks, dry vans, refrigerated (reefer) loads, and inter-modal freight.

This range of options allows owner-operators to choose the type of cargo that best suits their equipment and expertise. It also gives you flexibility in the kinds of hauls you take on.

Eligibility for Amazon Relay

According to the Amazon Relay carrier terms, here are the conditions you need to meet to qualify for being a driver.

Driver Criteria

To be eligible for Amazon Relay, drivers need to meet specific qualifications.

First, they must hold a valid Commercial Driver’s License (CDL). For semi-trucks, a Class A CDL is required, while for box trucks, a Class B CDL is enough.

Drivers must also be at least 21 for interstate routes and 18 for intrastate commerce.

You’ll also need to maintain strong safety records, with low scores in Amazon’s Behavior Analysis and Safety Improvement Categories (BASIC), including less than 60% in Unsafe Driving and HOS Compliance, and less than 75% in Vehicle Maintenance.

Carrier Criteria

Carriers interested in joining Amazon Relay must have an active DOT number with interstate authority and an MC number.

The carrier entity should be authorized for property and for-hire operations. Amazon Relay also requires carriers to have a satisfactory safety rating or no rating from the Federal Motor Carrier Safety Administration (FMCSA).

Carriers with scores above Amazon’s thresholds for Unsafe Driving, HOS Compliance, or Vehicle Maintenance may face challenges getting approved.

Vehicle & Trailer Standards

Amazon Relay has specific standards for the types of vehicles and trailers that can be used.

Carriers must operate either a 53-foot dry van or reefer trailer, or a 28-foot dry van trailer. For tractors, both sleepers and day cabs are acceptable.

Box trucks must be at least 26 feet in length, with interior dimensions of 26′ x 8′ x 8′, and must have a tuck-under liftgate.

It’s important to note that cargo vans, sprinter vans, and 24-foot box trucks are not eligible for Amazon Relay loads. All vehicles must be clean, well-maintained, watertight, and free from strong odors.

Amazon Relay Insurance Guidelines

Amazon Relay requires carriers to carry specific insurance coverages. These include:

• Commercial general liability: $1,000,000 per incident and $2,000,000 aggregate
• Auto liability: A minimum of $1,000,000
• Cargo coverage: $100,000
• Trailer replacement coverage: $50,000 for power-only loads
• Worker’s compensation: Required if the carrier employs W-2 drivers, along with employer liability coverage of at least $100,000

It’s important to have all these insurances validated before applying to avoid any delays. For more details on insurance, you can also check the Amazon Relay portal FAQs.

Performance Standards

Once you’re accepted into Amazon Relay, carriers are scored based on four performance metrics:

• On-time: Meeting pickup and delivery times
• App usage: Proper use of the Amazon Relay app for load tracking and updates
• Disruption-free: Completing loads without issues like missed assignments or delays
• Acceptance: Consistently accepting work offered

Amazon scores performance on a six-week rolling basis, grading from A+ to F. A higher score gives you access to more load opportunities, while low grades could result in fewer loads or even suspension.

Benefits of Amazon Relay

Considering using Amazon Relay to give your truck driving a boost? Here are some of the main advantages of using the Relay load board.

User-Friendly App

The Amazon Relay app makes managing loads simple.

Drivers can easily search for, book, and track loads right from their phones. The app also helps with updates, check-ins, and other essential tasks, making it easy to stay on top of everything while on the road.

Quick Payments

Amazon Relay offers fast payments. Once you complete a load, payments are processed weekly, meaning you’ll typically get paid within 1-2 weeks.

This quick payment system helps keep your cash flow steady.

Steady Demand

Amazon’s high volume of shipments means there’s always work available.

Whether during peak seasons or regular weeks, carriers can rely on steady load opportunities to keep their trucks moving.

No Load Minimums

With Amazon Relay, there’s no pressure to meet a load minimum. You can choose how many loads you want to take, giving you flexibility to work at your own pace and schedule.

Built-in Navigation

The Amazon Relay app comes with built-in navigation, helping drivers follow the best routes. It provides real-time updates, ensuring safe and efficient deliveries to Amazon facilities.

Drawbacks of Amazon Relay

While Amazon’s Relay load board is useful, it also comes with its potential drawbacks.

Night Run Frequency

Amazon Relay often requires drivers to run at night. Many of the loads are scheduled for evening or overnight shifts.

This can be challenging for drivers who prefer daytime driving or want a more regular sleep schedule.

Above-Average Requirements

As we’ve already outlined, Amazon Relay has strict requirements for carriers. These include specific insurance coverage, vehicle standards, and safety ratings.

Meeting these requirements can be difficult, especially for smaller carriers or new businesses.

Starting with Amazon Relay

If you’re interested in becoming an Amazon relay driver, getting started is relatively easy. Here are the key steps to follow.

Step 1: App Download

To get started with Amazon Relay, first download the Amazon Relay app. It’s available for both Android and iOS devices. This app will help you find and manage loads easily.

Step 2: Account Creation

Next, create an account on the Amazon Relay website. Follow the instructions to enter your company’s details. This will give you access to their load board and other tools.

Step 3: Information Submission

Submit all the required information, including your DOT number, MC number, and insurance details. Amazon will review your application and typically approve it within 2 – 4 business days.

Final Thoughts

Amazon Relay can be a great opportunity for truck drivers looking to expand their business and secure consistent loads. While it comes with certain challenges, it’s a convenient way to gain reliable, consistent loads – as long as you meet all the requirements.

If you’re ready to take the next step and need financing for your truck, get in touch with us at Mission Financial Services to explore flexible financing options designed for truckers. We make it easy to purchase your dream commercial vehicle and get your trucking business started

Steps to growing your trucking company can be challenging, especially as an owner-operator in the highly competitive trucking market.

The US trucking market size is somewhere around $217.3 billion, so it’s clearly an enormous market to tap into. However, you need to have a careful business plan that follows the right steps if you’re going to achieve consistent growth.

Whether you’re after more clients, want to expand your fleet, or simply want to increase the number of routes your business drives, here are the essential steps for growing your trucking company.

1. Set a Clear Growth Strategy

Before expanding your trucking business, it’s important to create a detailed growth strategy outlining how you’re going to do it.

Start by setting short-term goals (e.g. increasing fleet size or expanding routes in the next 6 months) and long-term goals (e.g. becoming a regional or national player within 5 years). Having clear goals is essential for keeping your trucking business growth on track.

Your strategy should be based on market research to ensure it’s realistic. Identify the types of freight in demand, under-served regions, or industries that need reliable transportation services.

It’s also important that you pace your growth. Expanding too quickly without a solid foundation can lead to operational inefficiencies. Carefully assess your current capacity and avoid overextending financially or operationally.

When planning to expand a successful trucking company, be aware of external factors like fuel price fluctuations, driver shortages, and economic conditions. These are always changing and will impact your strategy.

2. Know Your Costs and Pricing

As a trucking business owner, running a profitable operation depends on knowing your true costs.

First, understand your fixed and variable costs. Fixed costs (like truck payments, insurance, and permits) stay consistent every month. Your variable costs (like fuel, maintenance, and wages for truck drivers) change based on miles driven.

Owner-operators need to have a clear grasp of their rate per mile vs. cost per mile. Your rate per mile should exceed your cost per mile to generate profit. It’s essential to calculate both regularly, as they help you determine whether you’re pricing your services correctly. Use cost calculators and data from previous trips to make these calculations.

To optimize your business finances, you’ll also need to factor in market conditions. Keep an eye on freight demand and capacity.

Rates fluctuate based on seasonality, fuel prices, and economic conditions. Make sure that your pricing is competitive, but don’t undercut yourself to the point of low profitability.

3. Improve Cash Flow Management

Cash flow is the lifeblood of your business. Delayed payments are common in trucking, with clients often paying 30 to 60 days after delivery.

To manage your cash flow and operating costs effectively, you need to have access to working capital. Options like freight factoring can help. This is when a factoring company pays you upfront for unpaid invoices, helping you avoid cash flow gaps.

Carefully track your accounts receivable (money owed to you) and accounts payable (bills you owe) closely to avoid falling behind.

A great way to boost cash flow is to use billing and invoicing software. This helps you send invoices quickly and monitor payment timelines.

Integrated solutions (like TMS or factoring platforms) allow for faster invoicing and better tracking of unpaid invoices.

4. Leverage Technology and Automation

The trucking industry is increasingly driven by technology, and adopting the right tools can streamline your operations, help you save money, and improve efficiency.

For example, a good Transportation Management System (TMS) can automate scheduling, dispatching, billing, and reporting. This saves you time and reduces errors.

Digital load boards allow you to find quality loads efficiently. Instead of searching for individual shipments, you can connect directly with shippers looking for your specific services.

You can also use APIs to connect with carriers, shippers, and brokers for seamless integration. Automating routine tasks – like generating bills of lading or driver logs – frees up time to focus on growing your business.

5. Build and Diversify Your Client Base

To ensure long-term stability as an owner-operator, it’s crucial to diversify your client base.

Relying on just one or two clients can put your business at risk if their freight volume decreases or they decide to switch carriers.

Use load boards and brokers to find new clients when you have open capacity. While load boards can help in the short term, they shouldn’t be your primary strategy. Building direct relationships with shippers leads to better rates and more consistent work.

Some industries are more seasonal than others, so having a mix of clients across different sectors can help maintain consistent freight volume year-round.

Diversifying your geographic reach can also protect your business from regional economic downturns.

6. Prioritize Fuel and Asset Efficiency

Fuel is typically one of the biggest expenses in a trucking business. To control fuel costs, it’s important to focus on strategies for fuel efficiency.

Using fleet fuel cards can provide discounts on fuel, while apps like Fuelbook can help find the cheapest pump price along your route.

Transportation technology can also help you monitor fuel consumption. Use GPS and telematics to track fuel usage, driver behavior, and route efficiency. Reducing idle time, optimizing routes, and maintaining proper tire pressure can all contribute to better fuel efficiency.

To avoid “empty miles” (driving without a load), use backhaul strategies. Find return loads or leverage load boards to book outbound and return trips, making every mile count.

7. Invest in Compliance and Documentation

Compliance is non-negotiable in the trucking industry. Falling behind on paperwork or failing to meet regulations can result in hefty fines or even business shutdowns.

Fleet owners need to stay compliant with regulations.Fleet owners must comply with many strict laws that govern hours of service (HOS), safety, environmental standards, and more. Tools like electronic logging devices (ELDs) help ensure you meet HOS requirements.

It’s also essential that you keep your paperwork organized.

Efficient record-keeping (for taxes, maintenance logs, driver qualifications, etc.) ensures you’re always prepared for audits or inspections. A well-organized system can also improve your operational efficiency by reducing downtime caused by compliance issues.

8. Focus on Customer Service Excellence

Customer service is a key differentiator in the competitive trucking industry.

Owner-operators with small and medium-sized trucking companies can excel by providing a more personalized, reliable service than larger competitors. This is one of the biggest advantages that small fleet owners have, so it’s important to make the most of it.

Timely communication is one of the most important elements of customer relations.

Keep your clients informed throughout the shipment process. Offering real-time tracking, proactive updates, and on-time deliveries builds trust.

You’ll also want to use feedback to improve your services. Regularly ask clients for feedback. Addressing concerns and continuously improving your service can lead to long-term partnerships and referrals.

Satisfied customers are more likely to recommend your services to others, which helps your business grow organically.

9. Build an Online Presence

We live in a highly competitive digital landscape, so having a strong online presence is essential for growing your business.

Start with a professional website that outlines your services, contact information, and client testimonials. This is your essential digital foundation that helps potential clients find you and learn more about your company.

Trucking companies should also leverage social media. Platforms like LinkedIn and Facebook can help you connect with potential clients, share industry insights, and promote your services. Social media advertising can also help attract new business.

SEO is also invaluable for enhancing your visibility. Optimize your website for search engines so that when companies look for trucking services, your business ranks higher in the results.

Investing in digital marketing can significantly increase your trucking business’s success.

10. Monitor Business Performance

Tracking key metrics ensures that your business is running efficiently and profitably. Here are three important metrics to track when growing your business:

• Revenue per mile: This tells you how much you’re earning for every mile your trucks travel. It’s one of the most important indicators of your profitability.
• Fuel efficiency: Monitor how much fuel your trucks use per mile, and look for ways to improve.
• Driver performance: Use telematics to track driver behaviors (e.g. speeding, harsh braking) that impact safety and fuel efficiency.

By regularly reviewing these metrics, you can identify areas for improvement and adjust your strategies accordingly.

Data-driven decisions will help you optimize your business and drive growth continuously.

Final Thoughts

Growing a trucking business should be a slow and steady process. You can’t expect to make one quick change and grow your trucking business overnight. Instead, it’s about consistently taking the right growth steps and building up your business’s reputation.

Take the right steps, and you’ll set the stage for more sustainable business growth. This is essential for building a trucking business that stands the test of time.

As we mentioned, one of the most important things to get right is your finances. And as purchasing vehicles is the biggest expense for any fleet, working with the right vehicle financing provider is essential. Get in touch with us at Mission Financial to learn how to access commercial truck financing that will help you grow your company.

Managing a small fleet comes with plenty of daily challenges, from high costs to keeping operations running smoothly.

But with the right strategies, fleet operators can overcome these hurdles and make the most of their limited fleet.

To help you work smarter as a small fleet manager, let’s explore the key financial and logistical challenges small fleets face. We’ll also dig into some practical solutions to improve efficiency, reduce costs, and set your fleet up for long-term success.

Operational Challenges of Small Fleets

Fleet management comes with a range of daily challenges. Here are some of the major fleet operations issues that a fleet manager deals with daily.

Managing Drivers

Managing drivers in a small fleet involves closely monitoring their behavior, keeping compliance with safety regulations, and providing continuous training.

Using telematics and GPS systems helps track driving behavior, providing data for targeted coaching. Regular training sessions can also help reinforce safe driving practices and improve overall performance in driving fleet vehicles.

Driver Retention

Retaining skilled drivers is always an enormous challenge for a fleet manager because of high turnover rates and a competitive market.

Small businesses can’t always match the pay and benefits of larger companies, which makes driver retention even more difficult.

Vehicle Maintenance

For smaller fleets, the breakdown of even a single vehicle can cause serious disruptions.

Keeping a consistent maintenance schedule is vital for any fleet manager to prevent unexpected downtime. Fleet maintenance software can automate maintenance reminders, ensuring that routine inspections and repairs aren’t overlooked.

Educating drivers about the importance of pre-trip inspections and focusing on preventive maintenance schedules is essential for identifying and addressing potential issues early.

Cost Constraints

Operating a small fleet on a tight budget makes it tricky to balance expenses like fuel, maintenance, and driver salaries.

Fluctuating fuel prices add to the financial strain. So, implementing fuel-saving strategies, like optimizing routes and reducing idle time, can significantly cut fleet management costs.

Investing in affordable fleet management software is also a great way to streamline operations and highlight areas for potential savings.

Regulatory Compliance

Small business fleet management involves navigating a complex landscape of local, state, and federal regulations to avoid fines and legal issues.

Keeping up with changing rules can be challenging for smaller operations with limited resources. You need to stay informed about regulatory updates and maintain detailed records of vehicle inspections, driver logs, and maintenance activities.

Using fleet management software with compliance features simplifies the process by tracking hours of service, vehicle inspections, and driver certifications.

Financial Challenges

Of course, one of the most difficult areas of fleet management is dealing with the various financial challenges involved in running a fleet.

Capital Investment

Operating a fleet requires plenty of investment in vehicles, maintenance, and operational needs.

Small fleet owners need to budget carefully and adopt cost-saving strategies to manage these upfront costs.

Financing

Access to financing is crucial for spreading the cost of acquiring and maintaining vehicles.

Small fleets should explore various financing options, such as loans, leases, and grants, to find the best fit for their financial situation.

This is important for managing cash flow and keeping operations running smoothly without tying up too much capital.

Fuel Costs

Fuel is one of the biggest and most unpredictable expenses for fleets. It plays a large role in any fleet’s overall profitability.

Fleet managers need to monitor fuel trends and implement fuel-efficient practices and technologies to mitigate the rising fuel costs.

Insurance Costs

Small fleets often face higher insurance premiums per vehicle.

Prioritizing safety through driver training, tracking, and safe driving incentives can reduce accidents, which leads to lower insurance premiums. Regularly reviewing insurance policies and shopping around for the best rates can also help to manage these costs.

Logistical Challenges of Small Fleets

As a fleet manager, you need to operate efficiently to remain competitive. Here are two key logistical challenges you face in this department.

Fleet Maintenance

Keeping vehicles in good condition is essential to avoid unexpected breakdowns and maintain smooth operations.

Small fleet managers need to establish a strict maintenance schedule and use tools like maintenance software to track vehicle health. Educating drivers on pre-trip inspections can also help catch issues early, preventing costly repairs and extended downtime.

Dispatch and Communication

Efficient dispatch and clear communication are critical for keeping operations running smoothly.

Small fleets often struggle with limited resources for real-time tracking and communication. Without proper tools, it can be difficult to monitor vehicle locations, optimize routes, and respond to unexpected issues like traffic or breakdowns.

Investing in dispatch software with GPS tracking helps fleet managers stay connected with drivers, providing them with real-time updates and route adjustments.

The Importance of Efficient Fleet Management

Efficient fleet management is key to running a successful small fleet operation. It helps reduce costs, improve productivity, and increase profits.

By optimizing routes and schedules, fleets can save on fuel and maintenance expenses. Proper fleet management also ensures vehicles are well-maintained, reducing the risk of breakdowns and expensive downtime.

Good fleet management helps small trucking businesses meet their delivery deadlines, which boosts customer satisfaction and leads to more business.

Overcoming Small Fleet Challenges

Small fleets face unique challenges, like having limited resources and higher costs per vehicle. However, these challenges can be overcome with smart strategies.

Using technology like fleet management software and GPS tracking helps streamline operations and improve communication. Implementing cost-saving measures, such as fuel-efficient driving practices and regular maintenance, reduces expenses.

Investing in driver training and safety programs can lower insurance costs and improve fleet performance.

By addressing these challenges head-on, small fleets can operate more efficiently and compete more effectively in the market.

Final Thoughts

Running a small fleet can be tough, but overcoming fleet management challenges is possible with smart strategies and the right support. Efficient management and a focus on cost-saving can boost your fleet’s success, no matter how many vehicles you’ve got.

If you’re looking for flexible financing to grow or maintain your fleet, get in touch with us at Mission Financial Services. We offer the most convenient truck financing solutions to keep your business moving forward.