How can I tell if a trucking company is actually profitable?

A trucking company can show a healthy profit on paper and still be hard to run for anyone but its owner. The statements are only a summary. What matters is how the money is made: which trucks, which lanes, which customers. This page covers how to read a carrier’s books for that, not what the business is worth. A valuation is a separate job for a qualified professional.

Ask for results by truck and by lane

A combined income statement hides weak units. Ask for revenue and direct costs for each truck, and for each lane or customer group, over several years. A fleet where most of the margin comes from a few trucks or one lane is a different business from one that earns evenly. Look at how the pattern moved as equipment aged.

Empty miles and fuel surcharges

Ask how much of the driving is paid and how much is repositioning. Then ask how fuel is handled. Do customer contracts include a surcharge, is it billed on every invoice, and does it keep up when fuel costs move? Compare what was billed with what was collected. A surcharge that exists only in the contract does not protect earnings.

Adjust for the owner and for deferred upkeep

If the owner drives or dispatches without a full wage, the profit may be overstated, because a buyer would need to pay someone for that work. Your accountant can help restate it. Maintenance can also flatter earnings: a year of skipped service lowers costs now and raises them later. Your accountant can help you restate the numbers on a consistent basis, and an inspection of the units shows what the books do not.

• Revenue and direct cost for each unit, by year.
• Billed and collected fuel surcharge, compared month by month.
• The owner’s driving and dispatch hours, and who will cover them.
• Repair and maintenance spending against the age of each unit.

For the wider checklist, see what to check before buying a trucking company.