Updated: May 4
Headlines are saying we're currently in the best economy for truckers that the industry has ever seen. Some experts even predict things will be great for truckers into the year 2020. We love it that Owner Operators are making more money than ever before. However, this might be a good time to plan ahead and consider that things always change. In fact, change is probably the one thing in trucking that we can always count on.
Business is great, but the pendulum always swings back, in part because trucking is a supply and demand business. When demand (freight) is strong and supply (truckers) can't meet that demand, then prices and compensation increase – like now. But nothing lasts forever and it wasn't so long ago when supply was strong and demand was weak which meant flat or even falling freight rates.
It's a great time to be an Owner Operator, but I remind myself of the words of Richard Stocking when he was CEO of Swift, “Fortunes aren't made in the good times, they are made by surviving the bad times." Most of you have already survived the bad times so it doesn't hurt to prepare for more change. This could be the best time to take stock and consider a few ways that might be helpful in the future:
Pay down some debt. This is always a good thing to do. Start with the high interest debt or pay-off the smaller accounts first. Doing either or both of these frees up money to attack other debt.
Ask your banker about steps you can take now when profits are high. You may have some good options.
Pay cash for everything and don't take on more debt. There's a lot to be said for living debt free with less worry and less stress.
Get things done that have been postponed. It will be easier to pay for it now but schedule things like an equipment repair when it's a little slower (like the first week of the month) when it will hurt your business less.
Start a new fund or accelerate deposits into a current fund. Retirement or future college expenses are worthwhile and satisfying when you can put something away for the future.
Have some cash tucked away in case an opportunity comes your way like, perhaps, to upgrade your truck. If opportunity doesn't come along, you'll have the money either way.
Reward yourself with a day at the beach or some new boots you've had your eye on. A few modest personal rewards are something you've earned. Just don't blow the budget.
Speaking of budgets, have one. These are amazing tools that make sense of your work life and maybe even your home life. Following a budget is good for you and for your family.
I like to make fun of my farmer friends who today will say, “If it doesn't rain, it will ruin the crops." then tomorrow will complain, “If the rain doesn't stop, it will ruin the crops”. Like the rain, it's inevitable that things in trucking do change. Don't blame yourself or anybody else for those changes, just be ready.
It's only natural that when things change, it impacts all drivers and all carriers.