Taking a vacation, or just getting away from the trucking rat race for a few days is something many small and micro-motor carrier owners place on the back burner because they either think they can’t afford it or that their business will go down the tubes if they take a week or two off. On the contrary, as far-fetched as this may seem, a vacation is easily possible with just a bit of proper planning and foresight.
Research shows Americans, not just trucking company owners, work more than anyone in the industrialized world. They take fewer vacation days, work longer hours, and retire later. Several different studies have shown that taking time away from the job has both physical and psychological health benefits. People who take vacations have lower stress, less risk of heart disease, a better outlook on life, and more motivation to achieve goals.
With all that said, when you own a business, you must have a vacation plan to ensure the business continues to thrive while you’re re-energizing. And this means not having to constantly check in and manage from the beach or a cruise ship.
When it comes to developing your vacation plan, here are some basic steps to follow:
Step one: Know what it’s costing you to operate your trucking business day to day. For the purpose of your vacation goal, you need to know your daily fixed costs. Take your annual fixed cost total and divide it by 260. (Use 260 days and not 365 because no trucker runs with paying freight every day of the year. So 260 represents five days a week, which is the average time the vast majority of trucks actually generate revenue in a year.) Now you know your daily fixed costs.
The most important expense in your fixed cost is your salary. It doesn’t do any good to go on vacation and not have the money in reserve for things like car payments, rent payments, etc.
Step Two: What’s the number of days you’ll be on vacation? The more time you are away, the more planning required. A long weekend needs virtually no planning, while a week-long trip requires a lot.
Step Three: Add 10 additional days (five days before your vacation and five days after it’s over) to compensate for the loss of hauling revenue, due to having to be home on a specific date to start your holiday, and to return into a positive cash flow upon your return. (The 10 days provide a financial cushion.)
Step four: Multiply the total number of vacation days, including the 10 additional ones, by your daily fixed costs (including your salary). This total is the amount of cash reserve you’ll need in your business savings account at the time you plan to take your vacation.
Step five: Take this cash reserve requirement total, add it to your annual fixed cost figure, and divide by 260. This is your new daily fixed cost, the amount you need every day to pay your fixed business expenses, home expenses, and provide you with a vacation cash reserve.
This cash reserve is solely for covering all your trucking business expenses and personal salary or draw while on vacation and while getting back into the swing of the business upon your return. The funds needed for the vacation itself (plane tickets, hotel, etc.) are a separate savings plan, which is handled in the same manner to cover those expenses.
Now that you have the financial side of things covered for your vacation, you need to tie up a few loose ends to ensure your business is solid upon your return.
For that to be the case and to continue operating while you’re away, your employees and drivers need to make the right decisions. This means they must have the information they need to do their jobs as well as portions of yours.
The single-pony operator with one truck and no employees should take vacation during a slow part of the hauling year.
Locate another trusted single-pony operator who hauls the same freight in generally the same lanes as you. Coordinate work schedules so both of you can get time off. You cover for him with his customers, and he covers for you with your customers.
This is a win-win situation that will benefit both of you, as this will help increase his revenue during a slow period and give you the much-needed time off. In addition, you can reciprocate and cover for him while he goes on vacation either when you return or during a later slow freight period. Working together even though you may be competitors can have some real benefits.
Small-carrier owners need to delegate specific tasks and responsibilities to their employees. Make sure you divvy up the workload so one person isn’t overwhelmed.
Contact your regular shippers and brokers and let them know when you’ll be going on holiday—and don’t wait until you’re a couple of days away from departure. You need to let them know at least two or three months in advance, then again one month before the date, and finally, the week before you leave.
Provide your shippers and brokers with the contact information they’ll need to get in touch with your carrier staff in case of an emergency. And when you return, let everyone know you’re back. Such focused communication will help alleviate many fears and assure them that it will be ‘business as usual’ in your absence.
If your business is seasonal, or if there are foreseeable times when loads slow down, then that’s by far the best time to take a vacation. There’s less opportunity for problems to crop up.
Finally, set a schedule to check email and to be available to your staff if necessary, however, a word of caution. Keep this schedule to a minimum and set very strict guidelines on reasons for which your vacation can be interrupted. Remember, you’re getting away from it all to get a break from the routine and to rejuvenate your energy. The more interruptions you allow, the less effective and enjoyable the time off will be.
All work and no play will definitely take a toll on your productivity—and your bottom line. So, what are you waiting for? Go on that vacation that you so richly deserve.