Getting into the trucking industry is challenging. You should not just be mentally and physically prepared, but you should also be financially accountable and stable.
Also, the trucking business demands great responsibilities. Just a few of the obligations you'll have to deal with include overseeing the loading and unloading process, planning the safest routes for you and your drivers, communicating with dispatch, and monitoring and recording all activities linked with your company. And lastly — it is to understand and efficiently manage your business' expenses and budget everything effectively.
Like any other business, knowing how to budget and cut unnecessary expenses is essential. Especially as an owner-operator, you need to balance your priorities and whatnot.
The scope of your trucking company's expenses will vary depending on its unique structure and the way you run your business, but the following are the actual charges you'll want to keep track of:
- Truck cost
- Diesel expense
- Fuel Tax
- Road construction, weather, and the general market
- Truck maintenance and repair
But don't worry, we're here to tell you some tips on how you can manage your trucking expenses, so continue reading to know more!
Expand the use of the Transportation Management System.
Transportation Management System is a logistics platform that allows users to manage and optimize their transport fleets' everyday operations. Its main job is to organize and execute the actual transportation of commodities. Using TMS will greatly benefit you in a way that you can also simplify creating your invoices and Bill of Lading (BOL), calculating fuel tax, optimizing truck routes, as well as it can also provide you with a detailed breakdown and reporting of your business statistics.
Here are some examples of Transportation Management Systems:
Keep track of the monthly budget.
Keeping track of your expenses is one of the most important things you have to keep in mind. Once you understand the flow of money in your hands, you’ll be able to budget your operating expenditures efficiently, and you should be able to allocate cash to every key business area more appropriately through proper monthly budgeting.
Fuel is definitely one of the factors that contribute to your trucking company’s expense, but at the same time, it is obviously a necessity. But budgeting your fuel shouldn’t hinder you since there are many fuel-saving methods that are available and are intended for vehicle operators.
- Fuel discount card
- Maintain a safe driving speed
- Make sure you're using the proper fuel for your truck
- Avoid over-filling your tank
- Maintain a high gear
Create your own route.
By arranging the most efficient routes to each destination, trucking businesses may save a lot of money. Trucks are frequently dispatched only along major roads to specified delivery places. Alternate routes may be shorter and have fewer stops in some circumstances, but they aren't on the radar of fleet managers.
Also, there are applications or mobile software that can help you avoid traffic jams, road works, fuel stations with higher prices, etc., and can help you find alternate routes for your destination.
Here are some mobile applications that can help you efficiently managing and running through more convenient routes during your freight deliveries.
- Route Planning Map by Google
- Multi-Stop Route Planning and Optimization Tools
Regularly inspect the tires and engine.
Ensuring that your truck is well-maintained and meets the standard specifications for a good truck is not just a way to control your trucking expense, but it is also a good practice that can both benefit you, your truck and your truck driver.
Inspections of truck tires and engine parts regularly are critical to the safety and operability of the entire fleet. These actions will assist ensure that each truck performs more consistently and reduce the frequency of unexpected breakdowns. Preventive maintenance can save you a lot of money because emergency repairs can cost anywhere three to nine times as much as planned repairs.
When a truck's tires are misaligned or underinflated, it burns more gasoline since the engine has to work harder to compensate. A truck's fuel efficiency will improve with frequent tire inspections since problems can be detected and resolved before they become costly.
Between each dispatch, drivers should give their tires a once-over. Tires should be retreaded regularly for optimal performance and cost savings.
These factors that we mentioned above are just one way to lessen your expenses, but there are other factors that you might want to consider yourself. Also, it's not wrong to spend a little more if it will have a longer beneficial to you than settling on lower prices for maintaining your trucks or using cheaper equipment because sometimes, this can cost you more and might be risky to your safety.