Invisible Costs & Hidden Savings in the Trucking Office

Money in trashcanEveryone talks about reducing unnecessary spend in the supply chain. But almost nobody talks about the unnecessary spend in an individual trucking company’s office operations.

Which trucking office is most efficient—a firm that runs 50 trucks with 5 people in the office, 20 trucks with 8 people in the office, or 10 trucks with 5 people in the office? And why should you care?

You should care because there may be hidden savings in your operation that you may want to uncover. If you take advantage of them, that’s more money on your bottom line every week.

Trucking-company owners regularly complain to me about costs for insurance, maintenance, and so on. When I bring up office payroll, however, they often look at me funny. I get responses like these:

  • “We dispatch in Excel and bill in QuickBooks… Everyone does that, right?”
  • “The dispatcher writes everything down by hand in a book. Then he enters it into the computer. Then Tammy looks up the rate in our binder (or rating spreadsheet), calculates the rate, and tells Shari. Then Shari puts it into our accounting system. Easy enough.”

Here are the invisible costs. “Easy” is not the same as “streamlined.” Both owners above are wasting money on every order. They’re paying two or three people to enter information that could be entered once—if they had software that was a good fit with their operation. Multiplied by hundreds of orders a week, these trucking companies are paying duplicate office salaries—easily 6 figures in some offices—to have people do double-entry. It is an invisible cost because the people look busy and the work gets done.

VacuumInvisible costs suck money out every week. But are invisible costs necessary costs?

  • Are you paying 2 or 3 people to do the work of one, or 10 people to do the work of 8?
  • If one or more of those salaries flowed directly to your bottom line instead of going to your payroll account, and you still were giving great service, would that help your life?
  • If you saved that money every year for 10 years, would that be good? Could you retire early?

Office payroll is the #1 untapped opportunity  in trucking for cost savings. A business partner who can help you seize this opportunity is a valued partner indeed.

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