Managing your expenses is a cornerstone of any new business venture. Even as an already established transporter, you’ll need to have a solid sense of your existing outlay before considering expansion and growth.
Analyzing this issue, we’ve been relying on the feedback collected from our most successful drivers. A huge thank you to all the community members who took the time to contribute to our research!
Breaking down the expenses
When estimating transporter expenses, the totals can vary widely depending on how large of an operation you're running. But for the sake of discussion, let’s assume you’re earning about $10,000 per month, delivering 15-20 shipments. (See this article for more on a driver's earning potential.)
According to our data, you’d be spending 30% to 40% of what you’re bringing in to cover the cost of doing business. That’s between $3,000 and $4,000, which leaves a net profit of $6,000 to $7,000. But how would these expenses break down?
Unsurprisingly, fuel is item number one on the list of expenses. In the example above, it might set you back as much as $2,500 per month. Combined with the variable costs of food and accommodation, this takes up most of your monthly expenses.
Maintenance is another variable expense, but about $500 should take care of regular oil and tire changes (~20% of total expenses). Drivers who perform minor repairs on their own often spend less on this. The remainder is typically spent on insurance premiums, cleaning supplies, and tolls.
Given this breakdown, how would you go about minimizing your expenses?
“My commercial pet insurance is $1,200 a year… Being a former tech, I do my own maintenance… Fuel varies, I get 400-500 miles per 16-17 gallons a tank. I sleep in the vehicle often - I get a hotel if I feel like it and have two animals or less. Showers are $12 at truck stops.”
Since you spend so much on fuel, getting a cash-back credit card can make a lot of sense. Pick one that offers rewards on gas purchases, and you’ll easily make up 5% or more of that expense. Here are some online tools that can help you make the right choice.
There are also various fuel savings apps out there that help you find the nearest gas stop or search for the best deal available in a given area. Planning ahead, you can schedule your fuel breaks efficiently and get discounts based on the app’s loyalty program.
Depending on your vehicle situation, fleet fuel cards and truck stop cards can also bring substantial savings. Their reward programs often apply not only to fuel costs but other roadside expenditures as well (food, drink, showers, etc.)
Finally, if operating in the Northeast or Midwest, consider getting an E-ZPass that lets you zip through toll lanes quickly and efficiently. In 17 different states, it saves considerable amounts of time and can halve your toll expenditure. (In the West and South, similar benefits are provided by TxTag, Fastrak, NationalPass, and others.)
“Each month, I’m on the road for 20-25 days. $9,500 was my lowest revenue, $12,528 the highest, but the expenses vary. On average, I spend about $5,200 a month to cover fuel, food, maintenance, and tolls.”
Managing expenses is more of an art than a science but making these little tweaks can go a long way. We hope that you’ll find this breakdown of saving strategies useful. If you have a different take, please share your thoughts on social media. Our community of drivers appreciates a fresh perspective!
What to read next
For more general-purpose advice, see the Transporters section of our Help Center.