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What Percentage Do I Charge Someone to Run Under My Authority?

You can charge 15% to anyone running under your trucking authority because the average trucking company that has trucker drivers running under their authority usually charges a minimum of 15 percent.

However, it is important to note that the percentage you charge can vary widely and depends on various factors which we will discuss in this article.

If you are a truck driver or a trucking company, in order to maximize profits in the trucking and logistics industry, you may have to recruit other owner-operated truck drivers to run under your authority.

Running under someone else’s authority can be a good option for truck drivers who are looking for a stable job with access to freight and back-office support.

Basically, running under someone’s authority as a truck driver means that you are operating a truck that is owned by another individual or company, and you are subject to their rules and regulations.

This is a common practice in the trucking industry, and it has a number of advantages for both the driver and the company.

For the company, running under their own authority allows them to have more control over their core operations. They can choose the types of loads they haul, the routes they take, and the rates they charge. They are also responsible for maintaining the trucks and ensuring that the drivers are properly trained and licensed.

Note that if you are a truck driver or carrier who needs to start running under someone else’s Department of Transportation (DOT) authority, there are certain requirements you must meet before you can legally run under someone’s authority.

You must have a valid commercial driver’s license (CDL), and a minimum of 1 year or 50,000 miles of experience in trucking.

Once a driver obtains an “authority” from the owner or operator they are driving for, the driver must follow all regulations set by that authority while on the job.

Also, the driver will be responsible for all expenses associated with operating their vehicle, such as fuel, tolls, and maintenance costs.

Factors That Determine the Percentage to Charge Someone Running Under your Trucking Authority

  1. The Industry Standards

Before settling for a percentage to charge a truck driver that is under your authority, it is advisable to first conduct research on what other trucking companies in the industry or niche typically charge.

With the information you get, it will be easier for you not to undercharge or overcharge. You will be able to set your rates and attract the right truck drivers to run under your authority.

  1. The Services Provided and Value Proposition

The more support services you are providing to the truck drivers running under your authority the more you are expected to charge them.

For example, if you are offering significant guidance, mentorship, resources, or brand recognition for the truck drivers under your authority, it will be advisable to charge a higher percentage. Also, you should critically assess the unique value proposition you bring to the table.

If your authority or brand adds significant value to the person or entity operating under it, you can justify charging a higher percentage.

  1. Your Costs and Overheads

The costs and overheads you have to take care of should be part of the factors that should determine the percentage you should charge truck drivers that are running under your authority.

So, before settling for a percentage, you should first calculate the costs and overheads associated with providing the authority.

Note that your costs and overheads may include administrative, legal, insurance, and other operational expenses. Just make sure the percentage you want to charge covers these costs.

  1. The Legal and Regulatory Considerations

In as much as you are at liberty to charge any percentage of your choice, it is important to note that in some cities or jurisdictions, there are regulations that guide how much trucking companies should charge.

In essence, before you settle for a percentage to charge any truck driver who is driving under your authority, it is advisable to make sure that your pricing structure complies with any legal or regulatory requirements in your industry or jurisdiction.

  1. Negotiation

Although you might have a percentage you want to charge truck drivers who are driving under your authority, it is important to note that there is always room for negotiation. In essence, you must be prepared to negotiate with the parties interested in running under your authority.

Note that the percentage you charge may vary depending on the specific terms and conditions of the arrangement, and the negotiation skills of the truck driver you are negotiating with.

  1. Your Profit Margin

Lastly, no matter the negotiation skills of the truck driver who wants to drive under your authority or any of the factors listed above, the reason why you are in business in the first place is to make a profit.

So, ultimately, the percentage you should charge a truck driver who is driving under your authority should be one that allows you to make a reasonable profit while providing value to the parties running under your authority. In essence, don’t set a percentage that will make you run at a loss.