Pricing with Confidence: Know Your Floor, Protect Your Margin

In a competitive market, small fleets can’t win long term by undercutting rates. The antidote to margin erosion is a defensible pricing system anchored to your true cost per mile, a living fuel policy, and the discipline to say no when the numbers don’t work. With those pillars in place, you price with confidence—turning rate conversations into business reviews rather than haggling, and growing on purpose instead of by chance.

know your numbers and keep them current

Start with a cost model you can explain: fixed costs (truck payments, insurance, permits, office overhead) and variable costs (fuel, maintenance, tires) rolled into a baseline cost per mile. Ground your assumptions in information and data from recognized references such as the American Transportation Research Institute’s (ATRI) Operational Costs of Trucking and update fuel inputs weekly using the Energy Information Administration’s (EIA) EIA on-highway diesel price dashboard. Build or adapt a spreadsheet that reflects your lanes and equipment, and validate it using a simple calculator or one of many free cost-per-mile templates.

Segment your model by lane and customer. Include deadhead, typical detention, and your average speed profile (urban vs. rural vs. mountain). Your goal isn’t to match an industry average, but to know your own floor—and how it shifts when fuel rises, dwell increases, or a customer’s appointment rules impede turns.

turn your costs into a pricing system

Translate your model into rules you apply every time. Set lane minimums that reflect realistic turns and your floor. Index your fuel surcharge to the EIA diesel series with transparent brackets, and update it automatically as prices move. Document accessorials—detention, layover, truck order not used (TONU), driver assist—in your rate confirmations and customer standard operation procedures (SOPs) so expectations are clear before pickup.

Then, close the feedback loop. Compare planned vs. actual on each lane: deadhead percentage, dwell, average speed, and claims. If a lane repeatedly underperforms, adjust the minimum, change appointment windows, or replace it with higher-yield freight. Systematizing decisions keeps sales, dispatch, and accounting aligned on what “good business” looks like and eliminates the guesswork that leads to unprofitable commitments.

communicate value and enforce discipline

Shippers don’t buy trucks; they buy outcomes: on-time performance, proactive updates, and problem-solving when the plan changes. Frame your proposal with those outcomes and back it with transparent math from sources like ATRI’s cost studies and the EIA diesel index. Offer tiered pricing tied to service commitments (tight appointments, drop vs. live, late cutoff flexibility) and volume predictability. That makes trade-offs clear and helps both sides plan capacity.

Finally, protect your floor. If a load won’t clear your model, decline politely and leave the door open for future opportunities. Pricing discipline preserves capacity for profitable freight, stabilizes cashflow, and ultimately supports driver pay and equipment reinvestment—the virtuous cycle that grows fleets sustainably. A defensible system earns respect, even when a customer can’t meet your number today.

At Joe Morten & Son, Inc., we work with trucking operations to protect their bottom line. If you are ready to protect your investment, we’re here to help.