Previously in this series: How to change your decision-making for successful self-dispatch
I first discovered the discipline of economic behavior psychology by accident, and it helped transform my thinking. I recommend reading or listening to Dan Ariely’s “Predictably irrational: The hidden forces that shape our decisions.”
It took years for me to realize that the cost to haul the loads I was choosing often varied more on a per-mile basis than I had been (irrationally) assuming. Trying to select the loads based on the information showing on the load boards, or received from a broker on the phone, was playing out with more inconsistency in bedrock profit than I wanted. There just had to be a better way to more quickly evaluate the profit in any load -- with a better measure of accuracy in the evaluation.
After all, just because we’ve made decisions one way all these years doesn’t mean we’re doing it right.
Before we dive into the method I ultimately arrived at, here are a few questions to ask yourself and/or a load’s broker to get to the broader business decisions or a single load’s details -- you’ll need both to make the right evaluation:
With clarity on questions 1 and 2 in hand, to get toward 3, let’s start with costs -- fixed costs should be simpler to calculate and maintain control over given they only change when you add or subtract a payment. They’ll include any truck note, such as it may be, insurances, plates and permits, ELD service/cell phone and/or other services you subscribe to.
Total these monthly and divide by the number of days you are under a load in any given month. You could average for the year, but a more effective cost calculation may be to recalculate every month based on your prior month’s or prior quarter’s activity.
