How owner-operators calculate cost per mile

Why cost per mile comes first

A rate only looks good or bad when you compare it with what it costs you to run the truck. Your cost per mile is the number every load should be measured against. Without it, you are guessing, and a load that looks busy can still lose you money.

The basic formula

Add up everything it costs to run the truck over a period, such as a month, then divide by the total miles you drove in that period, including empty miles. The result is your cost per mile.

Fixed costs

These do not change with the miles you drive:

• Truck and trailer payments, or the value you set aside for replacing them
• Insurance
• Permits, registration and operating authority costs
• Accounting, software and phone
• Parking and other regular fees

Running costs

These rise with every mile:

• Fuel
• Tires and regular maintenance
• Repairs and a set-aside for big breakdowns
• Tolls and scale fees
• Any per-mile pay for a driver

Do not forget empty miles

Deadhead miles cost you fuel and wear but earn nothing. Use all miles driven, loaded and empty, when you calculate your cost per mile. When you compare a load, count the empty miles to reach the pickup and the empty miles you may face after delivery.

Your pay is part of the cost

Many owner-operators forget to pay themselves. Decide what you need to earn for your own time and add it to the number. A load that only covers truck costs is not a good load.

How to use it on every load

• Compare the offered rate against your cost per mile for the full trip, not just the loaded miles.
• Use it in negotiation: it tells you the lowest rate that works and where to push.
• Review it regularly. Fuel, insurance and repairs change, and so does your number.

Get help running the numbers

A dispatcher can check each load against your costs before you approve it. Read how owner-operators find good loads or talk to Dispatchero.