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How to Avoid Rate Cutting
Page 99
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AGRICTJLTURAL hauliers gathered in force when S.T.R., The Commercial Motor costs expert, lectured in Salisbury, last week. In his address he stressed the importance of making provision for future commitments in respect of upkeep and depreciation.
Most of the rate-cutting which was so prevalent in the industry was due, he said, to ignorance, rather than to deliberate intent. If all hauliers could be brought to appreciate the necessity of making ample provision for such items of expense as he had me.ntioned they would begin to realize that many of the rates now current were unremunerative.
S.T.R. demonstrated a method whereby such serious omissions as he had indicated could be obviated. He followed this up by suggesting a basis of rates assessment calculated by superimposing, on the ascertained operating costs, an empirical proportion for overheads and profit. An interesting discussion followed. One-haulier-present outlined a system of costing, used, he said, by himself, in which he debited his accounts at once with the purchase price of any new vehicle. He then devoted all his profits to writing off the amount. When that end had been achieved, he was at liberty to devote all the profit to himself, there being no need to consider depreciation as a. liability. Far Maintenance he paid as he went along, also for ,tyres.
The chairman, Mr. George Smart, said that the presentation of these lectures by S.T.R, (representing The Commercial Motor) was a publicspirited action of no mean order, and hauliers in general ought to be thankful for the help which they were securing. He went on to point out the value of unity in the industry, citing his own case (the well-known Smart appeal) as exemplifying how that unity helps.