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How To Build a Financial Model For a Trucking Business

Every business needs a financial model. Whether you want to understand what’s your breakeven, your valuation or create a financial model for the business plan of your trucking company, you’ve come the right way.

In this article we’ll explain you how to create powerful and accurate financial projections for a trucking business with a fleet of 9 semi trucks. Note that the numbers, charts and financials presented in this article come from our financial model template for trucking businesses.

For more information on trucking businesses, make sure to read our guides below:
How To Start a Trucking Business in 10 Steps
How Much Does It Cost To Start a Trucking Business?
How to Write a Business Plan For a Trucking Company?

1. Forecast Trucks

The first step of any trucking financial model is to forecast the actual number of trucks (or vehicles) over time. This means a few things:

  • How many trucks you will purchase (or lease) over time, and when
  • How much you pay for these trucks
  • How you finance the acquisition of trucks (leasing, debt or equity)

In order to do so, prepare a table like the one below, where you can list all the different trucks, their category (light, medium, heavy, specialized, etc.), purchase price, and all the criteria listed above.

Source: Trucking financial model template

The different sections are as follows:

  1. The different types of trucks and their category (each category will have a different revenue per mile as we will see later on)
  2. For each category, the number of vehicles acquired, the date of acquisition and the price paid per vehicle;
  3. For each category, whether you lease or buy the truck:
    • If you lease: the term of the lease (how many months will you pay back the lease) and the lease payment per month
    • If you buy: the % of the purchase price that’s covered by a loan, the interest rate per year and the term of the loan

That way, you will be able to forecast accurately how many trucks are available for you to operate:

Source: Trucking financial model template
A new semi-truck costs on average $100,000 to $200,000

2. Forecast Revenue

Now that we have estimated the number of available trucks over time, the next step in our trucking financial model is to forecast revenue.

Revenue is the function of:

  1. Number of available trucks (which we already calculated above)
  2. The number of miles per truck (per month)
  3. Deadhead rate (the percentage of the miles your trucks drive with an empty cargo)
  4. Pricing per mile
Tip: best practice is to have different assumptions for each truck category as shown below:

Now that you have set all 4 parameters for each truck category, you should be able to easily calculate revenue for all trucks as shown below.

Source: Trucking financial model template

3. Calculate Expenses

In addition to the one-off startup costs discussed here, you must also budget for all the operating costs of running a trucking business.

As you would expect, by far the biggest chunk of your costs are variable costs that are a function of the number of miles your trucks drive each month. From fuel, taxes, tolls and driver wages, let’s now have a look at the key expenses you should budget for in your business plan to run a trucking company with 9 semi trucks.

Operating costAmount (per month)
COGS (fuel, repair, tolls, brokers)$160,000 – $180,000
Drivers’ wages$50,000
Leasing or debt repayment$20,000
Rent (optional)$0 – $4,500
Other (legal, bookkeeping, etc.)$2,000 – $5,000
Total$232,000 – $259,500

Download the Trucking budget template

  • Lender & investor-friendly
  • Easy-to-use Excel template
  • CPA-developed financials
  • 30+ charts and metrics

COGS (fuel, taxes, tolls, brokers)

COGS stand for Cost of Goods Sold and refer to the expenses of any business that are variable in nature (unlike fixed costs) and appear above Gross Profit in your income statement.

There are a number of costs to take into consideration, they are:

Fuel ($0.4 – $0.5 per mile)

With salaries (more on that later), fuel is the largest expense for all trucking businesses. Per mile, it represents on average $0.40 to $0.50. Yet, with the recent increase of fuel costs in 2022, the cost per mile now average $0.55 to $0.65 instead.

Repair & maintenance ($0.09 – $0.40 per mile)

In addition to fuel, you should also budget for the regular checkup and maintenance cost for your trucks. On average, it costs $0.09 to $0.40 depending on the vehicle’s model and condition.

Tolls ($0.15 per mile)

Unlike gas, tolls is sometimes overlooked. Yet, tolls are also a major cost for any truck business, especially if you operate across state lines. On average, you should expect to pay around $0.15 per mile.

Brokers fee (15% of total revenue)

With the complexity of short and long distance fleet management today, brokers have become necessary for most trucking companies today. Freight brokers connect shippers with carriers (the trucking companies).

For shippers, brokers can reduce complexity by finding drivers for their loads in no time.

For the trucking companies, brokers provide new business leads, helping them keep their trucks on the road. They’re even more important that they will allow you to cut down deadhead to a maximum, effectively reducing operating costs.

On average, freight brokers charge 15% to 20% of the total price to the shipper, which is inherently passed on to the carrier.

So assuming you charge on average $3.00 per mile as a carrier, you should spend in total $1.36 in COGS per mile (about 45% of your total revenue). Now assuming each truck drives on average 15,000 miles per month, you would be grossing around $280,000 in revenue per month total (135,000 miles, plus 30% deadhead). 

Out of these $280,000, you would be paying around $160,000 to $180,000 back in COGS for fuel, tolls, freight brokers and maintenance costs.
Drivers’ wages and fuel represent about 60% of total expenses

Drivers’ wages

Salary expenses for the drivers are often included within COGS as well (like so in our trucking budget template), yet for simplicity we separate them in this article.

It’s all the more true for trucking companies that hire drivers not as employees but subcontractors instead (they invoice the company but aren’t considered as employees, giving more flexibility to the company when there is seasonality for example).

On average, you should pay between $0.28 to $0.40 per mile for drivers’ pay, including taxes and benefits. The pay typically depend on the route(s), the experience of the driver and the type of freight.

Assuming you pay an average of $0.35 per mile for your drivers, using the same $280,000 monthly revenue example above, you should set aside $50,000 per month for your 9 drivers (including taxes and benefits)

Leasing or debt repayment

Whether you decided to purchase the trucks with a bank loan or to lease them instead, you will need to pay back the loan or the lessor each month.

Now, let’s assume as explained earlier you purchased 9 trucks worth $1,350,000 with 85% of debt ($1,150,000 total) with a 5.50% SBA loan over 8 years, you would be paying back around $20,000 in debt and interest each month.

Rent (optional)

As explained earlier, not all small businesses operating a few trucks will require a separate parking, warehouse and office space. This is more true for large-scale trucking businesses with 6 trucks or more

Using the same example above with a 6,000 sq. ft. commercial space for a small office and parking space for 9 trucks in an industrial area, rent should cost you around $3,500 to $4,500 per month (including utility bills).

Source: Trucking financial model template

4. Calculate Lease / Debt Interest

Another important part of any trucking financial model is to forecast your balance sheet, and more especially:

  • Your assets (if you own the trucks); and
  • The debt

Doing so will allow you to do 2 important things:

  • Calculate debt interest expenses. Indeed, if you purchase some of the trucks with debt, another important expense will be the financial interest on the loan which you must forecast accurately
  • Forecast your cash flow statement. Indeed, as we will see in the next section, one of the most important impact on your cash flow are debt repayments (not the interest itself but the principal repayments instead).

Therefore, make sure you calculate, each mont:

  • Any debt drawdown (if you acquire new trucks with debt in the future)
  • Debt repayment (the actual loan repayments)

In the end, you should be able to obtain something like the chart below:

Source: Trucking financial model template

5. Build your P&L And Cash flow

Once we have forecasted revenues and expenses, we can easily build the profit-and-loss (P&L) from revenues down to net profit. This will help you to visualise key financial metrics such as Gross Profit or EBITDA margin as shown below:

Source: Trucking financial model template

The cash flow statement, in comparison, needs to include all cash items from the P&L and other cash movements such as capital investments (also referred as “Capex”), fundraising, debt, etc.

Cash flow is vital as it will help you understand how much funding you should get, either from investors or the bank (SBA loan for example) to start and run your own trucking business, which we do in our financial model template with the use of funds chart (see below).

In this chart below, we're showing you an example of a cost structure a 9-trucks fleet trucking business over the first 12 months. Unsurprisingly, over 75% of total expenses are the actual cost of acquisition of the vehicles (of which the large part is covered by debt) plus the COGS (fuel, drivers' wages, tolls, etc.).

Download the Trucking budget template

  • Lender & investor-friendly
  • Easy-to-use Excel template
  • CPA-developed financials
  • 30+ charts and metrics