Dr. Paul Borosky, DBA, MBA
Business Consultant & Fractional CFO
$1.65 Per Mile Before You Are Paid. $2.35 With Your Pay In It.
Cost per total mile uses every mile you drive. Cost per paid mile uses the same annual cost against loaded miles only. The expensive mistake is comparing a cost per total mile against revenue per paid mile, which flatters every rate you look at. Leaving your own pay out of the cost is the other one, and on this truck that alone is 88 cents a loaded mile.
Get it right and the next question answers itself. On the illustrative truck the business needs $2.06 per loaded mile just to cover its bills, and $2.94 per loaded mile to cover its bills and pay the owner $70,000.
Or call/text (321) 948-9588. Dr. Paul answers personally.
Last Updated: 9/9/2026 · Figures last verified 9/9/2026 · Reviewed by Dr. Paul Borosky, DBA, MBA
Start Here
What belongs in cost per mile, and what most owners leave out?
Three categories, and the third one is where the money hides.
One definition before the numbers. Every figure in this article is cash available to the owner before personal income taxes, after the equipment payment and after money set aside for maintenance. It is not accounting profit and it is not taxable net income. A loan payment is mostly principal repayment rather than a deductible expense, a transfer into a reserve is not a repair you have paid for, and an owner draw is not a deductible wage. Those distinctions belong to your accountant. This is a planning number for the question owners actually ask, which is what the truck leaves them to live on.
Fixed costs run whether the truck moves or not. The truck and trailer payment, insurance, plates and permits, the load board subscription, your phone and your accountant. On the illustrative truck that is about $39,368 a year, or roughly $3,280 a month that leaves before a wheel turns. Note that phone and accounting are fixed costs even though they are small; meals and parking move with the miles.
Variable costs run with the miles. Fuel, maintenance, tires, tolls, factoring, and meals and parking on the road. On this truck they run about $125,674 a year at 100,000 miles.
The third category is the one that gets skipped: your own pay, and the miles you were not paid for. Both are real, both are large, and leaving either one out makes every rate look better than it is.
Here is the arithmetic that decides everything else. Take total annual cost. Divide it by total miles driven, empty ones included, because you paid for fuel on all of them. That is cost per total mile. Now take the same total annual cost and divide it by loaded miles only. That is cost per paid mile, and it is the one you hold a rate against.
On this truck: $165,041 divided by 100,000 total miles is $1.65. The same $165,041 divided by 80,000 loaded miles is $2.06. Two ratios from one annual cost, not one calculation done twice.
The trap is comparing the wrong pair. A rate of $2.00 a mile looks fine against $1.65 and is a loss against $2.06. Costs are incurred on every mile you drive. Revenue arrives only on the paid ones. Put both on the same basis before you decide anything.
Dr. Paul's Insight
Owner-operators leave out the variable costs they never see as a bill.
Dr. Paul finds that over the road truckers calculating cost per mile forget or do not take into consideration all of the variable costs of the business. The revenue side is the easier half: the rate times the paid miles on the rate confirmation, which is not always the same as the miles you actually drive. The cost side is where it comes apart, because meals, showers, parking, tolls and the maintenance reserve never arrive as a single monthly invoice, so they never make it into the calculation.
The Money
The calculation, line by line.
Do this once a quarter with your own numbers. It takes an hour and it changes what you accept.
Step one. Add up every fixed cost for a full year. Payment, insurance, plates, permits, UCR, Form 2290, IFTA, load board, phone, accounting.
Step two. Add up every variable cost for the same year. Fuel, maintenance reserve, tires, tolls, meals, parking, factoring or quick pay fees, dispatcher fees.
Step three. Add your own pay as a line item, at the figure you need to live on.
Step four. Take your total miles driven for that year, all of them, loaded and empty. Then take your paid miles for the same year from the rate confirmations.
Step five. Divide the annual total by each mileage figure separately. Two ratios from one cost. Hold rates against the paid-mile figure and watch the total-mile figure to see what empty running is doing to you.
Worked example: the full build
Dr. Paul's Insight
Your pay is a cost, not the remainder.
This is where Dr. Paul draws the hardest line. Leave your own pay out of cost per mile and every rate on the board looks acceptable, because the business appears to make money at $1.70 a mile. It does not. It makes money at $2.94. The difference between those two figures is your entire income, and an owner who does not put it in the calculation is bidding it away one load at a time.
The Money
What is the lowest rate I can accept and still make money?
Two floors, and you should know both.
The hard floor is $2.04 per loaded mile. Below that, the load does not cover the cost of running the truck. Note this is slightly under the $2.06 average cost per loaded mile, and the reason is factoring: it takes a percentage of whatever you bill, so it has to be solved for rather than treated as a fixed dollar amount. Costs excluding factoring are $158,321, and $158,321 divided by 80,000 loaded miles at 97.2 percent is $2.04.
The real floor is $2.94 per loaded mile. That covers the truck and pays the owner $70,000. Between $2.04 and $2.94 the truck runs and the owner is paid something less than $70,000. Near the top of that band the owner still does better than the $58,640 median company driver wage; near the bottom he does not. Know where in the band you are sitting rather than treating the whole range as a loss.
There is a narrow case for taking something between the two floors. If you are already deadheading through a market and a cheap load partly covers miles you were going to drive empty anyway, it can beat running for nothing. That is a repositioning decision, and it should be rare and deliberate.
Where owners go wrong is treating that exception as the rule. A load that covers fuel feels like money because $1,200 hit the account. On this truck fuel is 36 percent of revenue. A load that covers fuel is covering roughly a third of what it needs to cover.
For context on the market: DAT reported dry van spot freight at $3.01 per mile with fuel and $2.39 linehaul in July 2026. The safest habit is to compare total revenue including the fuel surcharge against total cost including all fuel, on the same mileage basis.
Be careful with the shortcut of comparing a linehaul rate against a cost that excludes fuel. It only works if the surcharge actually covers your fuel, and often it does not. In these figures the implied surcharge is $0.62 per loaded mile while the truck burns about $1.08 per loaded mile in diesel. Strip fuel from both sides and you have quietly hidden a 46 cent hole.
The Operation
Deadhead and empty miles: the number that breaks the math.
Five points of deadhead is worth $15,000 a year. No rate change required.
You buy fuel on every mile. You invoice on the paid ones. That gap is the deadhead percentage, and it runs higher for a single truck than for a large fleet with freight density in every market. Published current figures are hard to come by, so measure your own from your logs rather than planning off an industry number.
On the illustrative truck the effect is direct. At 20 percent empty, 80,000 of 100,000 miles are billable and the owner clears $74,959. At 25 percent, 75,000 are billable, gross revenue falls $15,000, and after the smaller factoring fee the owner clears about $60,379. Five percentage points, roughly $14,580 in cash, with no change in the rate you negotiated.
This is why the outbound rate is only half the question. A high rate into a market with nothing coming out is often worse than a moderate rate into a busy one, once the return trip is priced.
Two practical fixes. Know the return market before you book the outbound. And consider whether a dedicated lane at a lower headline rate beats spot freight at a higher one. Dr. Paul has found that truckers running dedicated routes hold their profits consistently even though revenues are typically lower, and lower deadhead is a large part of why.
Do This
What Dr. Paul Would Do
Dr. Paul would build this from the owner's own receipts rather than an industry average, because the industry average is a fleet number and this is not a fleet.
He would start with revenue, which is the easier half: the rate times the paid miles on the rate confirmation. Then he would establish the mileage the truck really runs, all of it, loaded and empty, because those are the miles that generate cost.
Then the variable costs, one at a time, including the ones that never arrive as a bill. Monthly maintenance, fuel, meals, truck parking and tolls. Divided by the miles for the same period, that produces an honest variable cost per mile, and most owners are surprised by it the first time.
He would add the fixed costs and the owner's pay, and produce two figures: cost per total mile and cost per loaded mile. Both go on a card in the truck.
Then he would recalculate every quarter, because at $5.60 diesel a figure built in January is wrong by April.
The trucking business plan template includes the Excel model that does this calculation and updates the projections when the inputs move.
FAQ
Frequently asked questions
The four questions Dr. Paul gets most on this one.
How do I account for deadhead and empty miles?
Should I include my own salary in cost per mile?
How often should I recalculate my cost per mile?
What is a good rate per mile for an owner-operator?
Next Step
Put the Whole Truck in One Forecast
Every figure on this page came out of one financial model: the miles, the empty miles, the fuel price, the payment, the reserve and the rate, all in the same place, with the owner's own pay in as a cost line. Change one input and the projections move with it. That is the difference between a number you can defend to a lender and a number you remembered.
Everything on this page sits inside a larger system. Start at owner-operator trucking for the wider planning framework.
Trucking Business Plan Template
The Word plan and the Excel financial model built for a trucking company. Change the miles, the rate and the fuel price and the projections move with them.
Consulting and Business Plan Writing
Dr. Paul builds the model with you, in your numbers, and tells you what it says. Fifty states and Canada.
How to Write a Trucking Company Business Plan in Ten Steps
Ten steps, plus a complete sample trucking company business plan you can work from.
Dr. Paul Borosky, DBA, MBA
Business Consultant & Fractional CFO | 14+ Years | 1,000+ Clients Served
Dr. Paul Borosky, DBA, MBA, business consultant and fractional CFO, is dedicated to making owners stronger, sharper, and more effective. He is the founder of Quality Business Plan, creator of Dr. Paul's Organize-Plan-Grow™ Strategy, author of numerous published books on Amazon including How to Write a Trucking Company Business Plan in Ten Steps, and publisher of over 1,000 business-focused videos on YouTube. For over 14 years, he has helped trucking and small business owners turn a busy operation into a profitable one.
About the Numbers on This Page
The dollar figures on this page are illustrations of a calculation, not projections for any business, and they show cash available to the owner before personal income taxes rather than accounting profit. Insurance, repair, tire, dispatcher and factoring figures are industry averages from published data, not quotes. Every number here is an estimate, so get your own quotes and run your own figures before you decide anything.
Sources: ATRI Operational Costs of Trucking, 2026 Update. EIA Weekly Retail On-Highway Diesel Prices, week of 8/31/2026 and 2025 annual average. DAT Freight and Analytics dry van spot rates, July 2026.