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The First Step to Increased Profits

 

The First Step to Increased Profits

The first step towards increased profits is knowing where you are. You need to focus and set priorities on those things that are truly important and are going to enable you to reach your company’s goals and objectives. No distractions, no diversions.

Ask yourself these questions, and write down your answers in detail.

  • Are you profitable?
  • What are your strengths and weaknesses?
  • What areas of your business, customers, lanes and operational areas are profitable and which are not? And most importantly WHY?
  • What are your costs of doing business? Not just the variable cost of moving a truck from A to B, but all the fixed and overhead costs associated with it.
  • Do you have the management depth to accomplish your goals?
  • Does your pricing really cover all your costs and provide for a specific profit?

After you have answered all these questions in detail, you should be able to get a strong idea of where you are currently at with your business. This will provide a great benchmark for you as you move forward to the next steps.

Increasing your profits isn’t something that will happen over night, it takes time. Your time and attention must be focused on these different areas of your business, and understanding them. Once these areas are working together towards your goals, you will start to see your hard work pay off.

Read steps 2-9

Don’t miss out on our next webinar February 25th – Improving Trucking Profitability

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An Introduction to Cost Modeling

 

Many businesses with larger fleets are likely to have financial control systems, rate structures and systems for costing jobs. While this may be a common practice for larger operations, this is by no means the industry standard. Many trucking firms still rely upon inaccurate or incomplete data to make critical business decisions. Such businesses often find it difficult for managers and customers to identify where improvements and savings can be made. The goal of cost models is to make it easier to identify where these improvements and savings can be made.

Simply put, a cost model seeks to identify and document all of the costs associated with any specific trucking transaction, and is one of the keys to a profitable operation.  Using a cost model will help you to do a few things:Watch movie online Rings (2017)Watch movie online The Lego Batman Movie (2017)Watch movie online Logan (2017)Watch movie online Get Out (2017)Watch movie online John Wick: Chapter 2 (2017)

  • Improve your operational effectiveness and thus the performance and profitability of your business
  • Develop a robust pricing structure that all stakeholders (customers, employees, shareholders, etc.) will understand

A cost model allows you to provide a price for a job that bears a direct relationship to the costs involved. It uses current costs rather than historic ones and enables you to understand the true cost of your operation down to individual vehicles in the fleet. Cost models have many benefits for freight operators including:

  • Pricing structures based on true costs
  • Tighter control of operating costs
  • Informed business decisions
  • Improved business performance
  • Better utilization of resources
  • Increased professionalism
  • Competitive advantage

Our White paper, An Introduction to Cost Modeling: Why it Matters to Your Business goes into great detail on the benefits of cost models, and also breaks down how to price a job using a cost mode. Register for free to download the white paper, and start improving your operational effectiveness today!