Percentage Compared To Mileage - Some Real World Examples

Topic 21058 | Page 1

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Steve C.'s Comment
member avatar

I am no longer a driver, but when I first started I remember being confused and spending a lot of time thinking about how I was going to get paid and which method was better. I ended up working for a company that offers percentage pay, and just this week I was going through some old papers and found my first load book. I thought I would go through and give some real example loads and let you know how much I got paid as well as how much that works out to per dispatched mile. These loads are from late 2013, so I'm sure rates have changed some since then. Most of these loads also had tarp pay, which I am not including for these calculations. I was paid 27% of the load, so "My pay" is arrived at by multiplying the gross pay by 0.27. In turn, CPM is calculated by dividing My pay by the total dispatched miles (that is empty and loaded miles for the load).

Load 1, Steel coils
409 dispatched miles
Gross rate: $546.02
My pay: $147.43
CPM: 36

Load 2, Steel tubing
341 dispatched miles
Gross rate: $651.44
my pay: $175.89
CPM: 51

Load 3, Particle Board
191 dispatched miles
Gross rate: $555.20
My pay: $149.90
CPM: 78

Load 4, More particle board
901 dispatched miles
Gross rate: $998.32
My pay: $269.55
CPM: 30

Load 5, Sheet Steel
289 Dispatched Miles
Gross rate: $675
My pay: $182.25
CPM: 63

Total pay: $925.02
Total Miles: 2131
Total CPM: 43


This was over the course of a week of driving for me. I turned 2131 miles and averaged making 43CPM. This was probably on the upper end of "fairly typical" for me. The CPM would normally average closer to 40. The point I'm trying to make is that in the end if you are a productive driver you'll do just as well with mileage or percentage. Percentage seems to even out by giving you higher CPM on shorter runs, and lower CPM on longer runs (see Load 3 compared to Load 4 for a good example of that). Had I worked for a company that paid 43CPM instead of percentage (which is definitely not unheard of for flatbed drivers, even new ones) I would have made about the same amount of money. There are definitely some weeks where percentage made me more money than a mileage driver would get, but also there were other weeks where I would have made more getting mileage. In the end it evens out.

I hope this has been helpful to at least some of you. I'll try to keep up with this thread and answer any questions that may come up.

CPM:

Cents Per Mile

Drivers are often paid by the mile and it's given in cents per mile, or cpm.

Old School's Comment
member avatar

Hey Steve, it's good to hear from you!

I've never gotten paid by the percentage of the load, but I've often advised people that it is going to come out basically the same. It looks like you discovered that yourself.

There is some sort of a psychological hook to that percentage pay that makes people think they're going to yield more money by going that route, but it makes no sense. If doing this job was worth a lot more payroll dollars to these companies then they wouldn't make the drivers have to try and figure out what the best way to get paid is. Percentage pay is actually practiced to keep the company's margins at a desirable level, not necessarily the driver's pay.

Robert B. (The Dragon) ye's Comment
member avatar

It's all about the load value and customer when it comes to percentages, also which part of the country. Right now, rates are up and you would make more on percentage but again it depends on the customer.

Steve C.'s Comment
member avatar

Hey Steve, it's good to hear from you!

I've never gotten paid by the percentage of the load, but I've often advised people that it is going to come out basically the same. It looks like you discovered that yourself.

There is some sort of a psychological hook to that percentage pay that makes people think they're going to yield more money by going that route, but it makes no sense. If doing this job was worth a lot more payroll dollars to these companies then they wouldn't make the drivers have to try and figure out what the best way to get paid is. Percentage pay is actually practiced to keep the company's margins at a desirable level, not necessarily the driver's pay.

Hi Oldschool. I try to at least lurk the forums and make sure people are still getting good advice. Even though I didn't stick with trucking long term I am really glad for the experience and all the help I got here, so I want to pay it forward to anyone else I may be able to help. I agree on there being a psychological hook for percentage pay. It did make me feel better about getting short loads because it worked out to paying so much more per mile, even though in the long run it all evened out when I got those long loads paying less per mile. I think companies like TMC that do a lot of short runs (I feel like average length of haul was around 250) benefit from having the percentage pay just so their drivers feel better.

It's all about the load value and customer when it comes to percentages, also which part of the country. Right now, rates are up and you would make more on percentage but again it depends on the customer.

I agree with this, but the downside with percentage is when rates go down the driver instantly feels it, where as CPM drivers will be consistent. Again though, over the course of even a few months it evens out and both are fine choices.

CPM:

Cents Per Mile

Drivers are often paid by the mile and it's given in cents per mile, or cpm.

HOS:

Hours Of Service

HOS refers to the logbook hours of service regulations.
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