Setting the freight rates for your trucks is one of the most important decisions you will make when you operate a trucking company. Your rates will determine your success: If your rates are too high, you will not have customers, and if your rates are too low you will lose money. Normally, you will make higher rates on your outbound trucks because you will be hauling freight for your own local customers. You will often be receiving freight from brokers on your inbound freight and will give up a percentage of the revenue to the broker that found the freight.
1. Add all of your yearly operating expenses and divide that amount by the number of miles you travel in one year. Do not forget to add your office and payroll expenses to your truck operating expenses. The answer will tell you your operating cost per mile with no profit and is the minimum amount you should average on your rates.
2. Add the amount of profit you want to make. This amount will vary depending on your needs and the availability of freight. Only you can decide if you are out-pricing yourself if you add a profit to your rate on every load. Making a profit is not difficult when freight is abundant and trucks are in demand, but when there are more trucks than freight, you may have to forgo making a profit on every load.
3. Look at a price variance map for your equipment. The map will provide information on what areas of the country are abundant in freight and what areas are abundant in trucks. If you are hauling freight into a state like Florida, which is a consumer state, not a producer state, you need to set your rate on a load going into the state higher than normal because the load you take out of the state will not even meet your expenses.
4. Negotiate with your customer. If the customer is one that you have used before and intend on using again, you will want to work with him to set a rate that works for both of you. Often your customer will know of return freight when you deliver his load; if he is able to help, you want to consider this when you set his rate.
Tips & Warnings
1. Be professional when working with customers. If you are not able to negotiate a rate that works for you, be polite and tell your customer that you cannot run for that amount and explain why. Often shippers do not understand the cost of operating a truck, and explaining why you cannot work for what they are offering will encourage them to raise their rates.
2. Make a fuel surcharge chart, which will determine the amount of your fuel surcharge based on fluctuating fuel prices. Add the amount to your base rate.
Figuring the rates of truck freights helps you out to manage and be a successful freight broker.