It’s not necessarily one’s age or experience that defines the ability to succeed as an owner-operator. Consider the first half of 2020, which has been marked by unprecedented events and reactions. Yet one critical observation amid this tumult: Not everyone is failing. There are always new opportunities that emerge out of these disruptions.
To that end, here are a couple suggestions to consider at this midpoint of the year.
A new owner often sees driving miles as the focus, full stop. You’ve probably said it yourself: If the wheels aren’t turning, I’m not earning. With unpaid bills staring you down, it’s difficult to remain calm. A new owner client said it to me last week. This man and others are so worried about not driving every available moment that it is interfering with possibly better, more profitable load selections.
Those who know operating costs can make educated decisions, including those that reduce fixed costs. Owners who have had a profitable first and second quarter were able to adapt quickly, having a full and calculated control of their business. They may have had to change the customers and freight, as I’ve suggested to some clients. Some may have needed to pull a different type of trailer.
Van and reefer freight have been more consistent for many owners versus platform and more specialized freight, though that’s by no means a rule. Now, as demand returns in some sectors, manufacturing has begun to resume to replenish inventories.
Another driving force for rising demand: the cost of money. The Federal Reserve’s funds rate (the interest banks charge each other for loans) sits at just 0.25%, nearly 90% below the year-ago rate of 2.25%. While business lending rates haven’t dropped nearly as much proportionally, the cost of borrowed capital is down. Businesses are taking advantage of it, as with the coronavirus-related lending programs created through the CARES Act. Cheap money could create new opportunities for you.
If you’ve been too busy driving to consider your business costs or borrowing opportunities, maybe your best move now is to reset the breaker that has tripped from your overload.
