The Operator's Angle on Costing
Page 44
If you've noticed an error in this article please click here to report it so we can fix it.
Discussion on Mr. Winson's Paper at the C.M.U.A. Conference Stresses Need for Careful Records
DISCUSSION on Mr. W. A. Winson's paper before the Brighton conference of the Commercial Motor Users Association took place too late for inclusion in last week's issue. The address dealt with the statistical analysis of road-transport operations and evoked interesting comments, of which the following are representative:— • Mr. L. Gupwell emphasized the necessity, in any estimate of haulage, of providing for over-optimism. The operator must allow for contingencies, unforeseen traffic delays and for many other occurrences. Trouble from these causes could be avoided only by making proper estimates.
S.T.R. on Negligence.
S.T.R. The Commercial Motor costs expert, said that in his experience most users, including some of the largest, were remarkably negligent in keeping statistics. He referred to the difficulty, inherent in motor-vehicle accounts, that some items must inevitably be estimates.
He added that The Commercial Motor Tables of Operating Costs were devised principally as an aid in arriving at reasonably accurate figures for these estimated items. S.T.R. agreed with the author that ton-mile statistics must he most carefully compiled. With regard to depreciation, the Road and Rail Traffic Act had brought about considerable reduction in what might be called ,the residual value of cora mercial vehicles.
Mr. F. F. Fowler, referring to the author's suggeition that 'depreciation should be t' sayage,!: remarked that this was a matter which should be con
B34 sklered in relation to the class of work upon which the vehicle was engaged. He alluded to the author's use of the term "expectation of life" and to that having been considerably reduced by the cancer of legislation. Could not the industry cut out that cancer? He thought it could, and he was of opinion that it was now in a position to call in the help of the trading community. Mr. Oldham referred to The Commercial Motor Tables of Operating Costs as being most helpful. He warned operators that in considering charges and cost per ton they should differentiate between gross and net tonnage, because £.1 per ton gross Might easily become 25s. per ton net.
Mr. Macadam pointed out that the recording of cost per mile for various types of journey was a means for determining the most suitable vehicle for that work. The calculation of cost per ton aided in determining the choice of medium.
Mr. Raymond Birch warned goodstransport operators of the danger of accepting any arbitrary differentiation between long and short-distance traffic. They should take warning, he said, from the example of the passenger side, which had always bitterly regretted its easy acceptance of the division of
passenger transport into express and stage services.
Mr. II. E. McGillivray pointed out the difficulty in relation to ton-mileage figures and cited the case of a vehicle making several " drops " per journey, but discharging the bulk of its load near one end of the journey. The tonmileage figures calculated if the vehicle traversed its route in one direction would be vastly different from those calculated if the vehicle made the journey in the contrary direction.
Mr. Clifford Thomas said that many small operators keep no records at all. They should be impressed with the need for efficient working inside the office, as well as outside.
Never 'card of It!
Mr. J. P. S. Barber related an early experience when he addressed a meeting of haulage contractors. When he suggested that allowance should be made for depreciation, he was, he said, howled down. Costs as presented to hauliers were frequently put in such form as to be above their heads.
He wished it to be understood that in this connection he was not referring to Mr. H. Scott Hall. Moreover, The Commercial Motor Tables of Operating Costs were an exception to that rule.
Mr. Crow brought up the point that, whilst Mr. Winson's arguments in favour of " savage" depreciation were almost unanswerable, considered corn.mercially, they were still faced with the fact that depreciation allowed by the income-tax inspector was far removed from being " savage." It was not even an economic figure.