, am considering starting a parcel
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delivery service with a 15 cwt petrolengined van, averaging around 100 miles a week. Could you give any basis for calculation charges?
ACalculation charges for a small parcel delivery round is an extremely difficult exercise other than by a process of trial and error. In contrast to a nation-wide parcel service, or at least one covering a mixed area, where there could understandably be some averaging out between "good" arid -bad" deliveries in terms of time taken, such averaging might not apply to a small parcel operator.
For example, if most of his deliveries were in a rural area, the time taken to effect them would obviously be much longer than for a similar operator who happened to be in an urban area consisting of rows of terraced houses and adjacent shops.
Therefore, to reduce the period of trial and error, many small parcel operators setting up in business on their own for the first time tend to charge similar rates to those of local competitors until the newcomers have had sufficient operational experience to calculate their own charges.
In the meantime the following extracts from the COMMERCIAL MOTOR Tables of Operating Costs relative to a 15 cwt. van are relevant. The standing cost per week for this vehicle amount to £15 is 3d, the equivalent of 88.17d. per hour based on a 41-hour week. Running costs at the relatively low average mileage of 100 per week total 8.19d. a mile. The addition of standing cost and running cast give a total operating cost at 100 miles a week, of 44.34d. a mile or £18 10s Od. a week.
The figures so far given represent only the cost to the operator. Additions would then have to be made in respect of overhead cost and profit margin before charges were submitted to customers.