Overhead Allocation & Truck Profitability: the hidden loser

What it is

Overhead gets spread evenly across every truck when some trucks, techs, or service lines are actually unprofitable. The shop can't see which truck is the loser because the numbers are averaged together. Unprofitable service lines — repairs quietly subsidising installs, or the other way around — stay hidden inside one blended P&L, so the work that loses money never shows up as a problem.

How to spot it

• You can't produce a per-truck profit number in 5 minutes
• One truck or team is always "busier" but revenue is flat
• You don't know which service lines make money
• The "hardest working" tech isn't the most profitable
• The blended P&L looks okay but cash is always tight

How to measure it

Typical impact

~$15,000per losing truck, per year

A losing truck running at −5% margin on $300,000 of revenue leaks about $15,000 a year, and it often stays hidden for years inside a blended P&L. Multiply that across every underperformer in the fleet and the number climbs fast — all of it invisible until you split the P&L truck by truck.

How to fix it

1. Build a per-truck P&L — monthly, not annually. A profit number for each truck every month means an unprofitable truck can't hide inside the blended total.
2. Compute a fully-loaded cost per truck per day. Add labour, vehicle, and allocated overhead, then divide by working days — that's the number each truck has to beat.
3. Run a service-line margin analysis. Break margin out by line — repair versus install versus maintenance — so you can see which work actually makes money.
4. Kill or fix the loser. Once the losing truck is visible, reassign the work, retrain the tech, or retire the truck rather than letting it bleed.
5. Right-size the fleet. Don't run a truck that isn't clearing its fully-loaded cost per day; a smaller, profitable fleet beats a larger, leaking one.
6. Allocate overhead by usage, not evenly. The truck that runs more wears out more — assign overhead by how hard each truck works, not in equal shares.

The IronMargin angle: the per-truck profitability framework plus the financial-template pack on the Pro tier. This is the "see the leak" capability most owners simply don't have — once the P&L is split truck by truck, the hidden loser has nowhere left to hide.