---
title: "How Does \"Business Knowledge\" Make You More Profitable?"
description: See how knowledge about your business ultimately makes it more profitable.
image: https://info.etruckbizforfxg.com/hs-fs/file-2240591360-png/images/Profit_And_Direction.png
---

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# The Business of Independent Service Provider Contracting

## [How Does "Business Knowledge" Make You More Profitable?](https://info.etruckbizforfxg.com/blog/how-does-business-knowledge-make-you-more-profitable)

Posted by [Jeff Walczak](https://info.etruckbizforfxg.com/blog/author/jeff-walczak) on 12/18/14, 10:24 AM

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Most of you know that I have the wonderful opportunity to talk to many contractors daily, from coast to coast. They ask lots of questions, but what do you think the the most frequently asked one is? You might guess it's about new features or something in eTruckBiz right?

It's not.

The question that's on the most everyone's mind is: **How can I make my business more profitable?**

Actually, the answer is pretty simple. Yet few know the answer. For most, doing what it takes to become more profitable can be boiled down to doing one simple thing.

Before we tell you how to do this thing, let's understand why many of you may be struggling or not doing as well as you like. The reason your results may be suffering is because there is ***something you don't know*.** ![Profit\_And\_Direction](https://info.etruckbizforfxg.com/hs-fs/file-2240591360-png/images/Profit_And_Direction.png)

Let's look at an example...

Suppose you want to buy big new 60" smart TV, and the price tag on the TV is $1,400. Pretty steep right? So let's also say that you have $500 in your bank account at the moment.

So what is your first thought?

What do you *know*?

You *know* you can't buy the TV because you *know* you don't have enough money in your account currently.

If you don't have enough money, then you don't take the TV to the counter to try to buy it.

So, the *knowledge* that you don't have the money to buy the TV stops the purchase. You then make a good decision to not take the TV to the check-out.

Make sense?

So, what then, is the reason for continually making decisions in our operation that are detrimential to the bottom line? It's becasue there is *something that you don't know*.

Decisions are made, everyday, that are uninformed, and that my friends is what eats away at your profiability.

**You Must Know The Score**

If we carry this logic over to our business lives, then, the more knowledge you have about your operation, the more it will influence the daily decisions that are made. ![Keeping\_Score](https://info.etruckbizforfxg.com/hs-fs/file-2239254346-jpg/images/Keeping_Score.jpg)

When you have a solid understanding of your operational and cost numbers, your planning will be influenced by these and you will be able to make choices in a way that will positively influence your results. 

You must keep score (know your numbers) while the game is being played. If you don't, uninformed decisions will result and this will negatively impact your results.

There is no doubt about it.

I just had a conversation with a contractor the other day who says he is going to replace a couple of old trucks with some new ones this year.

I asked him *why* he was going to do it. He told me he *thought* about this or that, and he *feels* that it will make him come out better in the end.

Whoomp, there it is!

He is making an emotional decision that will have a large impact on his results, without analyzing it in an objective, numbers-driven way. I don't know if new trucks make sense over old trucks, especially in his case. But I do know that the way to make this decision is to lay all the numbers from fuel efficiency, to depreciation, to current maintenance costs and driver productivity to opportunity costs and so on, then decide on the best way to go.

Now I know that this guy is a good businessman, and I'm sure he has some good instincts about what to do, but instincts don't necessarily = profit.

I asked another ISP contractor how he came up with his *negotiated* settlement per stop from FXG. He couldn't answer this question and instead told me he wanted "more" in his fixed settlement.

And there you have it.

![Business\_Analysis](https://info.etruckbizforfxg.com/hs-fs/file-2242820727-jpg/images/Business_Analysis.jpg)

If you know the numbers (the score), then you'll know what to do. Not "think" you know what to do without the supporting data. Your knowledge of the situation will lead to a good, solid business decision.

**Where can you get this kind of knowledge?**

Actually, it is right there in front of you, buried in the data that is generated by your operation everyday. ![Data\_Mining](https://info.etruckbizforfxg.com/hs-fs/file-2240797265-jpg/images/Data_Mining.jpg)

The trick is capturing the data and turning it into useful information.

Our recent focus here at [eTruckBiz For FXG](http://www.etruckbizforfxg.com/) has been exactly this. We have developed a very easy way to upload your settlement and expense data, so that you turn this data into information you can use to make important decisions from.

Now you can read the information in the form of a graph, or, dive down into the data if you wish to really get a firm grasp of what is driving your results.

Do you know what it costs you to get a driver, in a van with fuel, to each one of your stops?

How much are you paying in payroll per stop? 

What does fuel cost you, per stop?

How many stops must you have to break even?

![Revenue\_Breakdown](https://info.etruckbizforfxg.com/hs-fs/file-2241841415-jpg/images/Revenue_Breakdown.jpg) 

How are you managing the decreases in volume? (Hint: this is where you lose it!)

Based on historical data and current trends, what should these things, and more, cost you going forward?

If you are an ISP contractor, what are you basing your negotiations on? What FXG is telling you? Really?

If you are an IC, what can you do to influence where PSA's are placed? Should you complain or should you show NUMBERS that back your case?

Knowing what your numbers, trends, averages, projections, margins and so on are is what a [successful manager](https://info.etruckbizforfxg.com/blog/does-your-business-fit-in-fxg%E2%80%99s-future-plans) knows does maintain and increase profitability.

 

Now, after a year in development,  eTruckBiz For FXG  software will help you gain valuable knowledge about your FedEx Ground business in order be maximize your profits!

[![Request A Demo Now](https://no-cache.hubspot.com/cta/default/439871/67107350-a63e-48a5-8d84-4cf050c17726.png)](https://cta-redirect.hubspot.com/cta/redirect/439871/67107350-a63e-48a5-8d84-4cf050c17726)

 Topics: [Business Results](https://info.etruckbizforfxg.com/blog/topic/business-results)

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