Editor’s note: This op-ed for Bus & Motorcoach News is written by Brian Dickson, owner and principal consultant of Bus Business Consultants.
In 2025, I asked operators to name the single biggest challenge facing their companies. Four issues consistently rose to the top: a lack of real-time performance data, driver recruitment and retention, rising insurance costs, and out-of-control variable costs.
In this article, we’ll focus on that last challenge — variable costs. Payroll, maintenance, and fuel may not make headlines, but they’re often the difference between healthy margins and red ink.
Why variable costs matter
Variable costs swing more than any other category. Payroll, maintenance, and fuel costs can fluctuate from week to week, and left unchecked, they can quietly erode profitability. Managed well, they create stability and give leaders room to grow.
I learned this lesson firsthand. In a previous role, I was tasked with temporarily filling the timecard auditor position. I knew the value of the exercise, but I also had to carve out time for it in an already busy day as the GM. What looked like routine paperwork quickly became one of the biggest levers for financial discipline.
By knowing the schedule, understanding pre- and post-shift and route times, and reviewing timecards daily, I could quickly spot discrepancies. Each one was questioned, and drivers were either paid for legitimate time or coached to correct their hours. That consistency brought clarity — and clarity created accountability. It also lowered costs, saving thousands of dollars over just a few months.
The lesson was clear: there are no silver bullets. Managing variable costs takes diligence, attention to detail, and patience. But small reductions achieved over time — across labor, maintenance, and fuel — add up.
Driver labor: A hidden lever
Driver payroll is often the single largest expense line. Without oversight, “hours creep” becomes inevitable. A driver adding just 15 minutes a day to their shift, five days a week, can cost $1,200 to $1,500 annually. Multiply that across your driver force, and the impact is significant.
The fix isn’t complicated:
- Accurate scheduling that builds in realistic drive times and pre-/post-shift allowances.
- Daily payroll review by someone familiar with the operation.
- Converting budgets into labor hours so supervisors can measure daily against targets.
Overtime, too, must be scrutinized. It’s a tool, not a lifestyle. If it becomes routine, it’s a sign of a staffing or scheduling problem. Supervisors and dispatchers should know daily how many hours are budgeted, how many have been used, and where adjustments are needed.
When handled this way, payroll oversight shifts from being a finance exercise to an operational leadership tool. Drivers respect the standards, supervisors stay accountable, and leaders make smarter daily decisions.
Maintenance: Costs that multiply
Maintenance is another area where discipline pays off. Mechanics and cleaners should be scheduled based on business needs, not just employee preferences. Align staffing with workload and fleet availability, not just tradition.
Parts and supplies also demand attention. I’ve seen tens of thousands of dollars written off at inventory time because usage wasn’t tied to work orders. Open parts rooms, missing documentation, and weak accountability create costly surprises. Regular reconciliations and monthly “mini-inventories” can prevent those year-end shocks.
Outside repairs, from engines and transmissions to towing, deserve leadership involvement. These are high-dollar decisions with long-term implications. A second quote or a capital expense analysis can mean the difference between investing wisely and throwing money away.
Temporary labor brings its own risks. Agency markups make temps expensive, and without oversight, their hours can easily creep. Daily approvals and weekly reviews are essential. Once eligible, bringing reliable temps onto your payroll reduces costs and strengthens commitment.
Finally, small recurring categories like oils, lubricants, and tires require the same discipline as big-ticket repairs. Tire lease programs, for example, only deliver value when actively managed. Left unchecked, they can lead to wasted dollars.
Fuel and fees: The quiet drain
Fuel is one of the most visible and volatile costs. Whether you buy in bulk with on-site tanks, use wet fueling, or rely on over-the-road cards, reconciliation is everything. Minor discrepancies in deliveries or drivers fueling at the wrong stations can add up to five- or six-figure losses annually.
- On-site tanks: Bulk purchasing usually secures the best pricing, but deliveries must be reconciled carefully.
- Wet fueling: Convenient and labor-saving, but requires strict oversight. A few unverified gallons per delivery can mean five-figure losses by year’s end.
- Over-the-road fueling: Works best if drivers stick to designated stations. Exceptions erode savings quickly.
Beyond fueling, leaders must also monitor internal billing. If you sell fuel to affiliates or third parties, ensure those transactions are captured and billed correctly. Unbilled gallons inflate costs and distort performance metrics.
Tolls, parking, and access fees can feel minor in comparison, but they add up quickly when multiplied across a fleet. For airports and ports, know precisely how fees are billed — per trip, per hour, or flat fee — and monitor them carefully. Drivers should avoid tolls when practical, but not at the expense of longer routes that cost more in fuel and labor.
Safety and training costs
Safety is essential, but it doesn’t come free. Payroll and overtime for training and compliance can creep up if left unmanaged. Extra hours should always be pre-approved, not assumed.
The right balance means investing enough to maintain a strong safety culture, while avoiding unchecked growth in safety payroll. Build safety sessions into normal shifts whenever possible to minimize overtime and focus on results. If the same issues resurface despite additional training, it may be time to re-examine the program rather than add more hours.
The goal is to make safety part of daily operations, not a bolt-on afterthought.
The leadership takeaway
Variable costs can feel unpredictable, but they aren’t unmanageable. The difference comes down to leadership.
When leaders set clear standards, monitor daily, and hold teams accountable, people respond. Drivers respect the schedule. Supervisors treat overtime as an exception, not a habit. Maintenance managers seek better pricing and track every part.
Every hour, every part, every gallon starts to matter. Costs come under control, margins improve, and organizations build the discipline to not just survive today, but to thrive tomorrow.
There are no shortcuts, but there is a path forward.
For a deeper dive into proven strategies for managing variable costs, read the full guide here: https://www.groundtransportationinsights.com/p/you-spoke-were-addressing-part-2
Photos courtesy of Brian Dickson
This column, Taming variable costs before they tame you, was originally posted in Brian Dickson’s Ground Transportation Insights Substack. Brian Dickson is the owner and principal consultant of Bus Business Consultants.
