A Budgeting Guide for Owner-Operators

Written by BooAdmin on . Posted in Uncategorized

Mechanic Fixing an Engine – Rapid City, SD – Godfrey Brake Service & Supply

For those on the outside, running a trucking company as an owner-operator may look like any other trucking job. If you are an owner-operator, then you know that this line of work is so much more. Even if you have only a single truck, you are still a business owner running your own enterprise. Not only do you need to be a skilled driver, but you also must be a savvy businessperson.

Finances are often the most challenging part of running any business, especially for those without prior management experience. Getting it right means both recognizing and managing your costs so that you can keep yourself in the black no matter how tough times may get. This guide will help you deal with one particular category of entirely unavoidable costs: maintaining your rig.

Expect the Unexpected

Routine maintenance is easy to plan for, but what about unexpected breakdowns? When a part on your truck fails, it can often happen seemingly out of the blue. Depending on your overall financial situation, repair costs may range from a minor inconvenience to a major threat. Repairs are never fun, but you don’t have to become a financial victim when an unexpected failure occurs.

Understanding your overall operating costs is the key to anticipating failures. When attempting to determine your long-term maintenance costs, try to develop a per-mile running estimate. If you’ve been operating for some time, then you can use records from previous years to establish this number. You should also consider discussing costs with owners of similar trucks to estimate long-term repair needs.

As a general rule, you should always remain on the conservative side. If you spent more on maintenance and repairs last year than the year before, then assume that this year will be even more costly. Increase your budgeting cushion each year as your truck ages to account for the higher potential for sudden failures.

Treat Maintenance as a Variable Cost

Some owners view maintenance as a fixed cost. After all, doesn’t your truck always require oil changes, new tires, brake replacements, and so on? While these needs are always there, their frequency varies based on your workload. If you drive more in a year, then your maintenance costs will increase. For this reason, you should always include your maintenance costs as a part of your per-mile budget.

More importantly, don’t ignore the potential for big-ticket repairs and maintenance to vary with mileage driven. You may not expect to replace your clutch and flywheel anytime soon, but what if you find yourself driving twice as many miles as you anticipated at the beginning of the year? When your workload changes, always immediately adjust your budgeting projections for the rest of the year.

If possible, treat this as another area to budget conservatively. Even if you expect your miles driven to return to normal next year, plan for your increased workload to continue. If you’re wrong, you’ll have extra money on hand for other unexpected expenses. If you’re right, you won’t be left short when the added wear and tear increases your overall maintenance costs.

Use Reliable Partners

Working with an experienced, reliable shop is a crucial part of sticking within your budget. Not only will this help ensure proper and on-time repairs, but it can also help you estimate maintenance and repair costs. Switching between shops can mean unpredictable costs for essential items such as brakes or oil changes, making long-term budgeting more difficult.

Building a relationship with a maintenance partner can also help you as your business expands. Whether you add more trucks or simply drive more miles, a good repair shop should be able to accommodate your expanding business needs. Staying with one shop can help you adjust your budget consistently no matter how your operation changes.

Whatever the size of your business, Godfrey Brake Service & Supply can be your reliable partner now and in the future. Contact us at any time to discuss your maintenance and repair needs.

BooAdmin


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Address: 110 Poplar Avenue | Rapid City, SD 57701

Phone: (605) 343-5030

Email: [email protected]

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