The Catalysts of Profitability
Where margin is really won—and lost—in your operation
Most operators don’t lose money all at once.
They lose it a little at a time.
There’s a scene in Any Given Sunday where Coach Tony D’Amato talks about life being a game of inches. The idea is simple—those inches are everywhere. Every minute. Every second. And when you add them up, they make the difference between winning and losing.
I used to use that same idea with my teams.
Except instead of inches, we talked about dollars.
The point then—and the point for you today—is this:
I’m not going to sugarcoat this—some of this may be uncomfortable.
The decisions we make every day—pricing, operations, safety, and fleet and facility decisions—all add up.
And over time, those decisions make the difference between making money and losing it.
The dollars you need—and where your margins are really won and lost—are everywhere in your operation—
in how you price, schedule, maintain and invest in your fleet, and how you run your day-to-day business.
A former boss of mine used to say, “Drops make puddles, and puddles make lakes.”
Same idea.
Small decisions don’t feel like much in the moment.
But over time, they either build margin—or they erode it.
The decisions that consistently build margin are what I call catalysts of profitability.
Not because they’re complicated.
But because when they’re in place, performance improves.
And when they’re not, it doesn’t.
These aren’t theories.
They’re the things that show up in your numbers every day.
Catalyst #1: Understanding Your Costs
If you don’t know your costs, you don’t know if you’re making money.
Profitability starts with knowing your numbers.
Not estimates. Not assumptions.
Your actual costs.
That includes:
Driver wages and benefits
Other labor (operations, safety, training, admin)
Insurance costs
True maintenance costs
Fleet costs (payments, depreciation, capital)
Licensing and regulatory costs
General & administrative expenses
But it’s not just about listing those costs—it’s understanding where they show up in your business.
For example, what percentage of your revenue is going to:
Driver wages and benefits
Other operating wages (dispatch, supervisors, etc.)
Safety and training wages
Administrative wages
Insurance
Maintenance (and do you know your cost per mile?)
Fleet costs
Licensing
G&A
Most operators can answer some of these.
Very few can answer all of them.
If you can’t answer these questions, you’re not managing your costs—you’re reacting to them.
This is what it costs to run your business—before you ever price a job.
Catalyst #2: Well-Informed Pricing
If your pricing doesn’t reflect your costs, margin disappears—whether you see it or not.
Knowing your costs is one thing.
Turning those costs into the right pricing is another.
A lot of operators do one or the other—but not both.
And you need both.
Pricing starts with your cost structure
Once you understand your costs, the next step is to ensure they are reflected in your pricing.
Many operators use a proforma model to help build their pricing. Not necessarily for every quote, but on a regular basis—to:
Set pricing
Validate it
Monitor whether it’s actually achieving the margins they expect
Because pricing isn’t something you set once.
It’s something you have to monitor over time.
Markets change. Costs change. Fuel changes. Labor changes.
And if your pricing doesn’t change with them, your margins disappear.
Once upon a time, many operators could review pricing annually.
Today, it’s better to review it at least quarterly to make sure it still reflects your costs, the market, and the margin you need.
And operators need to be careful about locking in commitments too far out if there’s a risk the work could become unprofitable.
Pricing is built on how the work actually runs
Pricing isn’t just a number—it’s built on the drivers of the work.
Time drives how many drivers you need and how much labor you’re paying
Miles drive fuel usage and, over time, your maintenance costs
Trip specifics drive costs like tolls, parking, lodging, and per diem
And your pricing must include enough margin to make the work worth doing.
Just as important, your terms and conditions have to support it.
Because if they don’t, you can price the work correctly and still lose money.
You also have to understand the market
Well-informed pricing isn’t just about your costs.
It’s also about understanding:
Who your actual competitors are (not every carrier is)
What they’re charging for similar services
Where do you fit in the market
We used to shop our competitors regularly—not to chase price, but to understand the market.
Because pricing in a vacuum doesn’t work.
A real example
We had a long-standing hotel shuttle that everyone assumed was a solid piece of business.
It ran consistently.
The relationship was good.
They paid on time—so from a cash flow standpoint, it looked like a win.
But when we actually broke down the pricing—factoring in the true labor, fuel, and maintenance tied to the miles—we realized something:
We weren’t making money on it.
We were paying to operate it.
That didn’t happen overnight.
It happened over time—through small assumptions that were never revisited.
And until you actually stop and evaluate it, those kinds of contracts can sit there for years.
The takeaway
Revenue is not the same as profitability.
And steady work that “feels good” can quietly drain your business if it’s not priced correctly.
Well-informed pricing means:
Knowing your costs
Building pricing around how the work actually runs
Understanding your market
And monitoring it over time
Because if your pricing isn’t built on reality, your margins won’t be either.
