3rd dat carrier benchmark survey

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DAT SPECIAL REPORT

3rd DAT Carrier Benchmark SurveyQ1 2013


DAT Carrier Benchmark Survey Among the 514 trucking companies who took our online survey, most respondents fell into one of two groups: (1) for-hire carriers with small fleets (an average of 7.8 power units and 16 trailers, in a range from 2 to more than 500) and (2) owner-operators with a single truck that the owner drove under his own authority. A smaller number of respondents identified themselves as private fleets or asset-based brokers. Because those two groups operate under a different business model, their answers are not included in this report.

Carriers’ Costs Rise Faster than Rates Throughout much of 2012, we noted that carriers’ costs were rising faster than their rates, and that outlook was confirmed. Year-over-year comparisons illustrate a point that has been made by a number of trucking industry analysts in 2012. To quote Donald Broughton of Avondale Partners, for example: “…the per-mile costs of operating a truckload carrier are going up at a pace twice that of the pricing power currently being achieved.” In short, carriers’ costs are rising twice as fast as their revenues.

Key Results Slip to 2010 Levels Key performance indicators declined in 2012 for all fleets surveyed, so that results were more similar to those reported in 2010 than in 2011.

Monthly Profits Exceeded $3,000 Per Truck The small, for-hire fleets and owner-operators yielded gross profits of more than $3,000 per truck per month in 2012.

More Empty Miles, Shorter Hauls

Empty miles increased in 2012, when compared with survey results in the previous year. Both for-hire carriers and owner-operators saw empty miles increase to 2010 levels.

Avg. % Of Miles Driven Empty

Avg. Length Of Haul, One Way

Avg. Total Miles Per Truck, Per Month

Avg. Rate Per Loaded Mile, Including Fuel

Surcharges (US$)

Avg. Revenue Per Truck

2010 2011 2012

$14,986

$18,429

$16,168

$1.73

$2.05

$2.00

9,264

10,440

9,734

11.6%12.5%

9.9%

820852

754

$12,060

$17,684

$14,431

$1.75

$2.10

$1.95

8,236

9,3218,986

14.9%

10.2%

15.8%

866

920

878

For-Hire Carriers Owner-Operator

2010 2011 2012

DAT SPECIAL REPORT 2

Due to their low overhead, owner-operators achieved higher gross margins than for-hire carriers, on a per-truck basis, before taxes and depreciation.

19% For-hire carriers

21% Owner-operator

Major KPIs By Year For-Hire CarriersAverage Revenue per Truck


Length of haul declined, and the change was greater for the for-hire carriers (-11%) than for the owner-operators (-4.6%). A shorter haul usually correlates with higher rates, but that was not the case in 2012.

Total miles per truck declined slightly, on average. For-hire carriers with multiple trucks and drivers had more flexibility to re-position assets, so they logged 8.3% more miles than owner-operators. The owner-operators typically had one truck and drove it themselves, so the truck was parked whenever the driver took a break for home visits or hours-of-service regulations.

Rates per loaded mile appeared to dip for both groups, but that result was not significantly different from 2011. For-hire carriers and owner-operators reported higher rates in both 2012 and 2011 than they did in 2010. According to DAT RateViewTM, average contract rates rose 2.9% in 2012, while spot market rates declined 1.1% nationwide, not including the fuel surcharge.

Monthly revenue per truck dropped, compared to the previous year, due to a combination of the decline in total miles and the increase in miles driven empty.

Top 3 Profit Drivers: Rates, Fuel Efficiency and Asset UtilizationProfitability was largely a factor of the rate per mile for both for-hire carriers and owner-operators. In second place, the most significant factor for the for-hire fleets was fuel efficiency. Owner-operators improved profitability most by getting a higher rate and reducing the percentage of miles driven empty.

Rates per loaded mile (bottom) were the biggest factor in profitability for small, for-hire fleets as well as owner-operators. After securing a higher rate, for-hire carriers improved profits most when they boosted fuel efficiency (center.) For owner-operators, reducing empty miles (top) was the second-most important factor in determining profitability.


Avg. Profit/Los s Avg. R evenue per T ruck

F or-hire carrier <5.50

5.50-5.99

6.00-6.49

6.50+ $7K

$3K

$5K

($2K)

$17K

$17K

$16K

$16K

Improving F y Boosts Fleet Revenue


O wner-operator 0% -5%

5.1% -10%

11% -20%

21+% $1K

$3K

$4K

$4K

$11K

$14K

$16K

$20K

Reducing Empty Miles Drives O-O P


F or-hire carrier < $1.75

$1.75 - $2.00

> $2.00

O wner-operator < $1.75

$1.75 - $2.00

> $2.00

$8K

$3K

($1K)

$20K

$17K

$14K

$5K

$3K

$1K

$18K

$16K

$12K

Higher Rates Yield Best Return


Load Board is the Primary Source of Freight

Load Boards

Freightbrokers or 3PLs

Contracts With Shippers

Owner-Operator

45.1%

28.1%

22.8%

For-Hire Carrier

37.1%

28.2%

31.1%

All the survey respondents used load boards, which were the primary source of freight for both for-hire carriers (37%) and owner-operators (45%). Freight brokers and 3PLs provided 28% of the loads to both groups directly. Shippers provided 31% of loads to for-hire carriers while only 23% of owner-operators’ freight came from shipper contracts.

Load Boards Improve Utilization for Van FleetsIncreased use of DAT Load Boards led to an improvement in asset utilization, espe-cially for fleets that included more than 50% van trailers. The relationship between load board use and empty miles was not significant for reefer or flatbed carriers.

Owner-Operators Achieved Higher Margins Due to their low overhead, owner-operators achieved 21% gross margins while for-hire carriers’ margins were lower at 19%, on a per-truck basis. The owner-operators had an average of 1.2 power units, and gross profit of $3,046 monthly per truck, for a 21% gross margin. For-hire carriers made an average of $3,892 per month for each of their trucks, across an average of 7.8 trucks, per fleet. Their total gross profit was $26,559 per month, representing a 19% margin, before taxes and depreciation.

2012 Key Performance Indicators, by Fleet Type

Monthly Revenue Per Truck

$16,527 for-hire carrier

$14,431 owner-operator

Total Rate Per Loaded Mile

$2.00 for-hire carrier

$1.95 owner-operator

Percent of Miles Driven Empty

12.5% for-hire carrier

15.8% owner-operator

Total Monthly Miles per Truck

9,734 for-hire carrier

8,986 owner-operator

Length of Haul, One-Way (Miles)

754 for-hire carrier

878 owner-operator

Fuel Mileage per Gallon (MPG)

6.4 for-hire carrier

6.0 owner-operator

Monthly Gross Profit Per Truck

$3,154 for-hire carrier

$3,046 owner-operator

Gross Profit Margin, Before Taxes

19% for-hire carrier

21% owner-operator



Financial Comparisons: For-Hire Carriers and Owner-Operators

Monthly Costs, Revenues and Profits Per Truck*

Direct Costs For-hire carrier Owner-operator

Fuel $6,783 $6,048

Driver pay $1,959 $1,165

License/Reg fees $1,376 $1,531

Lease (power unit) $539 $456

Truck Maintenance $338 $433

Truck Tire Costs $263 $286

Lease (trailer) $186 $131

Overhead Costs For-hire carrier Owner-operator

Non-driver payroll and benefits $1,277 $285

Rent or mortgage payment $131 $175

Insurance per truck $255 $452

Cell phone $122 $275

Office phone, fax and internet $47 $60

Utilities, including electricity and water $27 $37

Other overhead $70 $52

Key Performance Indicators For-hire carrier Owner-operator

Revenue per Truck $16,527 $14,431

Pre-Tax Profit $3,154 $3,046

Pre-Tax Profit Margin 19% 21%

* For each survey respondent, direct costs per mile were multiplied by total miles driven, overhead was divided by total miles and number of trucks, and revenues were multiplied by loaded miles. The results were averaged for each of the fleet types.

For-Hire Fleets Made More Money For-hire carriers received a higher average rate per mile, and they achieved better fuel efficiency and asset utilization than the owner-operators. Due to higher operating costs, however, for-hire carriers had lower gross profit margins than owner-operators. The for-hire carriers, with an average of 7.8 power units, had additional costs associated with higher total miles driven per truck, as well as indirect expenses, including offices, other facilities and non-driver payroll.



2013 Goals: Raise Prices, Reduce CostsImproving revenue while cutting costs were the top two goals expressed by carriers, earning above 2.5 on a scale of 0 to 3, where 0 meant ‘not important’ and 3 meant ‘very important’. The third place option was “bring in new business.” All three goals were shared by owner-operators and for-hire carriers. Rounding out their top five goals, for-hire carriers emphasized driver retention and adding power units or trailers, while owner-operators planned to add or improve technology in the cab and in the office.

2013 Priorities - rated on a scale of 0 to 3For-Hire Carrier Owner-Operator

Improve revenue per mile 2.8 2.7

Reduce costs 2.5 2.4

Bring in new business 2.2 2.1

Add or improve office technology 1.8 1.7

Add power units or trailers 2.0 1.5

Improve driver retention 2.1 1.3

Recruit and train new drivers 1.8 1.3

Add or improve in-cab technology 1.6 1.7

2013 Challenges: Fuel, Rules and Maintenance The cost of fuel was seen as the biggest challenge facing fleets and owner-operators in 2013, followed by regulatory compliance and equipment maintenance. Insurance, financing and credit were among the other top concerns shared by both groups.

2013 Challenges - rated on a scale of 0 to 3For-Hire Carrier Owner-Operator

Fuel cost 2.7 2.8

CSA, HOS and other safety regulations 2.3 2.3

Equipment maintenance 2.3 2.2

Insurance 2.2 2.1

CARB and other environmental regulations 2.0 1.9

Financing and credit 2.1 1.8

Driver recruitment and training 1.9 1.3

Driver retention 1.9 1.3


2013 Priorities Shared by carriers and owner-operators

Improve Revenue Per Mile1. Reduce Costs2. Bring In New Business3.

2013 ChallengesCost of fuel is biggest concern

Fuel Costs1. Safety Regulations2. Equipment Maintenance3.


34.4% Owner-operator

51.3% For-hire carrier

8.4% Carrier-broker

4% Private fleet

1% Other

16% One truck, leased

1% Leased on, multiple trucks, drivers are not employees

13% Multiple trucks, with authority

66% One truck with DOT authority

2% Leased on, multiple trucks, drivers are employees of O-O

2% Other business structure

Call 1.800.547.5417DAT.comCall 1.800.547.5417DAT.com

How We SurveyedThe Third Annual DAT Carrier Benchmark Survey drew 514 responses from DAT customers, including carriers, owner-operators, private fleets and asset-based brokers. They filled out an online questionnaire, anonymously providing detailed information about their fleet operations. This report is based on responses of the for-hire carriers and owner-operators only. The margin of error is plus or minus 6.1% for the for-hire carriers and 7.7% for owner-operators.


Survey Respondents: 51% For-Hire, 34% Owner-OperatorMost respondents to the annual DAT Carrier Benchmark Survey in the past three years have been owner-operators (blue) or for-hire carriers (orange). Among the owner-op-erators surveyed this year, 66% own a single truck (shown on the second chart below) and drive it under their own authority. This survey report separates for-hire carriers from owner-operators, for purposes of comparison, and omits answers from private fleets and asset-based brokers.

3rd dat carrier benchmark survey

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