One of the most common mistakes that owner-operators make is not preparing a budget for their trucking business. It is important that owner-operators outline a budget or projected cash flow, and it is also important that owner-operators consistently check the budget so any inconsistencies or errors will be caught early and adjusted in time. Unfortunately, some truck owners do not view budgeting or record keeping as one of their main priorities.
Outlining a budget will certainly be a smart move, especially if you want to find yourself at the top of the ladder in the trucking industry. The budget you construct should consist of your business expenses, including Tennessee owner-operator truck insurance, and your personal expenses, in addition to other expenses that may need to be covered when you least expect it. If you have funds that are reserved to cover additional expenses, you will not have to scramble to find a way to pay for a truck breakdown or a delay in the freight.
While it can be easy to use your income to take care of your bills and living expenses and use the remainder of your income until you receive payment for the next month. However, this tactic will only work for a short period of time because if you are contracted to a company, the money that is earned does not all go to you. You will need to cover maintenance, repairs, business expenses, and more.
Since we have reached a new year, you have another opportunity to avoid making a mistake that so many other owner-operators have made and learned from. Now is the perfect time for you to calculate your budget and your expected cash flow for 2020. If you calculate your projections now, you will have an opportunity to make adjustments during the year so you can improve your bottom line.
When you have a budget in front of you and you can see your calculations, you will be able to determine if you are on track or if you are off track. If you are a new owner-operator, you may want to begin your trucking journey by being leased to a carrier. The carrier will take on the responsibility of securing insurance. However, as the owner-operator, you may find yourself responsible for the premiums.
When you are an owner-operator, you will discover that it can be both rewarding and profitable. However, your success will depend on the steps you make throughout this journey. Contact us today for information on our commercial or owner-operator truck insurance packages.
