Discover how much money you are making so you can continue to profit
Assets, equity, expenses, and income what now?? Doesn’t sound like your usual trucking jargon does it?
Accounting words can seem foreign to most business leaders who aren’t in the accounting industry. Profit and Loss (P&L) statements are full of them and can be easily underrated and often overlooked.
A big mistake.
P&L statements are lifelines for your trucking company which can make or break any chances of growth. They are vital for the business no matter what condition your accounts are in or how many loads you’re doing. Just because you’re still paying bills, doesn’t mean you ain’t losing money or ain’t underperforming.
So why bother if the money’s coming in? We’ll get straight to the point. Once a P&L statement is completed, you’ll know how much money you’re losing or how much you are making. And we really hope it’s the latter! Not only this, you’ll identify areas for improvement, opportunities to save money, areas for growth and any irregular transactions. This is why they are so important and need to be maintained consistently and accurately.
“Never take your eyes of the cash flow because it’s the life blood of the business.”Richard Branson
Finding the right template can be challenging when there are so many generic options out there created for any business in the world. If you have a trucking company, you know the trucking industry has its own unique streams of income and expenses which are easy to forget when they’re not pre-entered on a P&L statement template. A trucking specific document will make life so much easier for you, as it is always going to be quicker to complete and assures more accuracy.
What is a Profit and Loss Statement?
Your P&L statement lists all your company’s financials, taking in all the revenue you had during that period and subtracting the expenses. It will not consider loans, personal deposits or withdrawals. Loan payments are not an expense however, the interest you pay is.
P&L statements should be completed monthly, quarterly or annually. If your company is new, the more frequent the better for the initial set-up period. You want to know exactly how much profit you’re making, so you can act fast with business decisions which will shape your future. If you’re already established with secure income, it’s safe to do one annually provided there have been no major changes in that time. New senior leaders, trucks, routes and cargo may mean doing one more frequently during the transition phase. A completed P&L Statement will also help develop sales targets and prices for your services, as well as rates of pay for the remainder of your team.
What’s on every template?
Your P&L statement template needs to include your company’s revenue, expenses and profits. Revenue will be the money you are making from all dispatches. Expenses are the costs of operating your trucking company and will include items such as insurance, fuel, payroll and truck financing. Profit will be the amount of money left after expenses have been removed (also called net income.)
Every P&L statement works with a simple calculation of revenue less expenses equals profit.
The simple solutions
There is no shortage in choices when it comes to business accounting software. Which is great. And confusing. For the easiest processes, you are best off doing all your accounting on one platform, which will provide a simple P&L statement template along with clear prompts for how to complete them and flexibility to customise your own. Additional benefits of an entire software package means there will be less inputting and calculations to be made provided you are using the platform to record costs and expenses as they come in and out of your business.
We’ve sought through what’s out there, and have come up with these options based on simplicity and the features specific to trucking companies.
Truck Logics provide a template specifically created to help trucking companies understand and identify financial history, health, and overall performance. They make it easy to manage income and expense transactions with several trucking specific benefits you’ll definitely use. You can manage fuel expenses and reoccurring expenses as well as income transactions with custom created accounts. From a completed statement, you can generate accurate reports based on recorded numbers for your company.
Trucking Office have specifically developed their templates for owner-operators. As truckers themselves, they know what features are required which makes their solution convenient and easy to use. The template allows you to create your own expense categories, so you can remain in control. You’ll easily identify spending tendencies with this template, for better management of your fleet.
Axon will help you create your own template, to be printed at any time of the year for any period. You can design these yourself to suit specific needs with selective information you wish to include and the layout of the report. This includes page breaks, various sections and any other formatting required to make it as user friendly for you and other stakeholders as possible. Reports can be sent to a printer, screen or text file so it becomes easy to add the document to other storage areas and to share it as well.
Time to Choose
Ready to keep it simple? Choose what’s going to work for you so you have the freedom to be less attentive to the costs of operating your trucking company. Becoming more familiar with your financials also means you can adjust some of your highest expenses according to observations. The right template will even do this for you.
You’ll know you’ve chosen the right P&L statement template if you’ve managed to determine your trucking businesses net income by listing out your revenue and expenses during a specific period of time – with ease. Numbers can get very complex very quickly so choosing the simplest format for your statement will save time as well as promise accuracy on every occasion.
What are you waiting for? Time to see how much money your making and spot any opportunities you can, to build on your current tucking empire. If you thought your largest haul truck was as high as things are getting, think again y’all. The sky’s the limit when it comes to trucking and if done correctly, your P&L statement can take you to the clouds.