By Timothy D. Brady
Now there’s a contradiction in terms. A trucker planning a vacation?
Taking a vacation is something many micro-motor carriers place on the back burner. The trucker either thinks he can’t afford it or his business will go down the tubes if he takes time off. On the contrary. As far-fetched as this may seem, a vacation is possible with a bit of planning and foresight.
Step One: Developing your plan:
Know what it’s costing you to operate your trucking business day-to-day. For the purpose of your vacation goal, you need to know your daily fixed costs. Take your Annual Fixed Cost total and divide it by 260. (You use 260 days and not 365 is that no trucker runs with paying freight every day of the year. 260 represents 5 days a week, which is the average time the vast majority of trucks actually generate revenue.) Now you know your daily fixed costs. And remember, the most important expense in your Fixed Cost is your own salary. You need to have the money in reserve for things like car payments, house or rent payments, etc.
Step Two: What’s the number of days you’ll be on vacation?
Plan enough days so that you’ll actually relax and thinking about things totally unrelated to trucking. Why take time off, if you’re going to worry about what’s going on with your carrier.
Step Three: Give yourself the revenue to cover the short revenue days.
Add 10 additional days (5 days before your vacation and 5 days after its end). This is to compensate for the loss of hauling revenue. This is to cover being home on a specific date to start your holiday. Plus when you return to a positive cash flow upon your return. (The ten days provide a financial cushion.)
Step Four: Calculating the money you’ll need in reserve.
Multiply the total number of vacation days, including the 10 additional ones, by your daily fixed costs (including your salary). This is the amount of cash reserve needed in your vacation savings account.
Step Five: Calculating what you’ll need to add to your hauling rates.
Take this cash reserve requirement total, add it to your Annual Fixed Cost figure, and divide by 260. This new total will be your new daily fixed cost. This is the amount you need every day, to pay all your fixed business expenses, personal home expenses, and provide you with a Vacation Cash Reserve.
Please note: this cash reserve is solely for covering all your trucking business expenses. It includes your personal salary during your vacation. And while getting back into the swing of the business upon your return. The money needed for the vacation itself (plane tickets, hotel, etc.) is a separate savings plan.
How to structure your time away so you return to a thriving operation.
Now you have the financial side of things covered for your vacation. Here are a few loose ends that need to be handled to ensure your business is there upon your return.
For the business to be there when you return your employees and drivers need to make the right decisions. This means they must have the information they need to do their jobs as well as portions of yours. This is accomplished by training them well in advance.
How to cover your loads as a single-pony operator to go on vacation.
For the owner/operator with one truck and no employees.
1. Pick a slow part of your hauling year when load pickings are slim.
2. Locate another trusted single-pony operator who hauls the same freight in the same lanes as you.
3.Work schedules out so you both can get needed time off. You cover for him with his customers and the other trucker covers for you with your customers.
This benefits both of you.
1. It helps increase his revenue during a slow period and give you the needed rejuvenation period.
2. You can reciprocate and cover for him while he goes on vacation. This can either be when you return or, if needed, during a later slow freight period.
Working together even though you may be competitors can have some real benefits.
Learn to delegate to others long before you’re headed out the door for some R and R.
For the small carrier owner, you need to delegate specific tasks and responsibilities to your employees. Don’t give one staff person all of your responsibilities; make sure you spread them throughout the ranks so one person isn’t overwhelmed.
Notifying your customers.
Contact your regular shippers and brokers and let them know when you’ll be going on holiday. And don’t wait until you’re a couple of days away from departure. Let them know at least two or three months in advance. Then again one month before the date. Finally, the week before you leave. Provide them with your contact information so they can get in touch with you if they have an emergency. And when you return, get in touch with everyone and let them know you’ve returned. Focused communication will help alleviate many fears and assure them that it will be ‘business as usual’ in your absence.
Best times to take a vacation.
Plan around slow periods if your business is seasonal, or there are foreseeable times when loads slow down. That’s by far the best time to take a vacation. For one reason, there’s less opportunity for problems to crop up.
Set a schedule to stay in touch with your office personnel or trucker covering your loads.
Finally, set a schedule to check email and to be available to your staff. A word of caution on this final step. Keep this schedule to a minimum and set very strict guidelines. Remember, you’re getting away from it all to get a rest from routine and rejuvenate your energy. The more interruptions you allow, the less effective and enjoyable the time off will be.
All work and no play will take a toll on your productivity and your bottom line.
Timothy D. Brady © 2012