Solving the Problems of the Carrier
Page 38
Page 41
If you've noticed an error in this article please click here to report it so we can fix it.
Criticism of the R.H.A. Rates Schedule AREADER living in Belfast has written to me concerning the article which I wrote for "The Commercial Motor" dated November 30 of last year, dealing with the R.H.A. proposals for a national rates schedule. He says that, in his opinion, the rates for normal and heavy traffic in full loads are rather high, even on present-day costs, and would not be competitive with haulage costs of traders operating their own vehicles. He states that he has tried to discover why this should be and has come to the conclusion that it is mainly due to two factors: (1) the generous "terminal and speed ratio" allowances, and (2) the conservative "balance load" allowance.
In the case of the first point, he continues, according to Table 11 reproduced with the article, a 6-ton lorry running with a full load of normal traffic between two places 20 miles apart and returning empty is allowed approximately eight hours for the job, i.e., terminal running and shunting, one hour; loading and delivery, three hours; running, 3 hours 55 1-10 mins., say four hours—a total of eight hours.
Except where a vehicle is operating in a congested district, the normal running time, he suggests, would not exceed two-and-a-half hours, and a haulier would expect his vehicle to do two such loads in approximately nine hours.
In respect of the second point, he says: "According to my reading of Table II, no matter how long the haul is, the load over the double journey is assessed at less than 75 per cent, as for 20 miles in each direction it is reckoned there will be no return load. I should hope that the majority of hauliers on their regular routes would do much better than this."
I agree with this criticism on one or two points, but not in the main. It does appear that the allowance for terminal delays in connection with the 6-tonner is excessive and so is the provision for travelling time.
Return Loads "A Mistake" When the Lead Mileage Does Not Exceed 20 I agree that carrying one-way traffic only it ought, except in unusual circumstances, to be possible to make two corn plete journeys per day. But I am of opinion that that would not be possible if the vehicle had to pick up a return load on each journey. I would go so far as to state that I agree entirely with the R.H.A. Rates Committee, that it is a mistake, generally speaking, to take return loads into consideration at all until the lead distance exceeds 20 miles.
This critic, in his letter, implies that, in his view, the majority of public hauliers would obtain return loads over a 20-mile lead and still run two journeys per day. I think that such cases are the exception rather than the rule. In any case, it could be made profitable only if the haulier concerned be picking up his back loads from the delivery point of his outward load. I think readers will agree with me that an operator who is in that position is very fortunate. Although I do know of cases of that kind, they cannot be taken as a basis for formulating a standard schedule of rates.
Another point raised by this critic is that relating to the prevalence of return loads. I am not quite sure whether he believes that a 75 per cent, balance-loading factor is low or not. If it be his view that it is low then, again, I do most definitely disagree with him. In my opinion, it is high.'
I rather think that this correspondent is arguing from the particular to the general, instead of vice versa. His experience has, apparently, been mainly in connection with operations over routes affording favourable opportunities for return loads and he is' attempting to judge the findings of the R.H.A. Rates Committee on that basis. He is wrong in doing so.
As a matter of fact when I read the Interim Report, and dealt with it in "The Commercial Motor," I deemed it wise not to be hypercritical. I know from personal experience what sort of a job the Committee must have had. In particu
lar, I appreciate the difficulty it must have met in trying to solve the everlasting problem of providing, in a scheme of stabilized rates, for the return load.
I think, as a matter of fact, that the only criticism of any moment I made was that there was no provision for the many traffic routes in the country over which the "balance factor" never rises to 75 per cent, and may average as low as 25 per cent. I made that criticism with diffidence, because I felt that it was such an obvious one to make.
However, this correspondent asks me to let him have some further comments upon the points he has raised. I have been through my notes with the idea of tackling the problem entirely on the basis of my own information, so that I might see how far my own conclusions would differ from those reached by the Committee.
I find that, according to my figures, the allowance for the expectation of back loads, that is to say, the balance factor, should be 60 per cent. and not 75 per cent., the figure in the Report. It means that, according to my methods, in arranging the rate for traffic over a given route, the total charge should be calculated on the basis of ;he cost of the round journey, plus profit, plus 331 per cent., the result of that calculation being the rate for one-way traffic in either direction.
Higher Rates Than Those Proposed by the R.H.A. Committee Putting that in terms to correspond with those in the Report would mean that whereas in the R.H.A. document the pay-load per lead mile for distances over 20 miles is taken as 9 tons on a 6-tonner, in my case I should take it PS only 8 tons. The rates I would propose would, therefore, be somewhat higher than those arrived at on the calculations made by the R.H.A. Rates Committee.
I should mention here, for subsequent reference, that, while I was building up the rates schedule, I was concerned at the time I collected these notes with making provision to charge demurrage for any excessive delays at terminals over and above the times provided for in the calculations.
Almost immediately, in my own examination of the question, I came up against the very point which is raised by this critic. It may well be that, in answering him, I am giving the reply that the R.H.A. Rates Committee would itself give, but, of course, I cannot vouch for that.
What I am doing in this article is to try to put myself in the position of the Committee and to imagine the way in which it would deal with this question, but using my own figures and experience as a basis for drafting the reply.
The first point is that of arriving at a decision on the minimum lead mileage at which it becomes practicable to make some allowance in the rate for the possibility of there being a return load. Coupled with this is the equally important matter that it must be profitable to the operator to pick up that return load. It has always seemed to me and to others, as I am aware, that there must be a point in the ascending scale of lead mileages below which the operator is more likely to lose than gain by picking up a return load.
My own way of arriving at this figure for lead mileage is, admittedly, of the hit-or-miss order. There is, as far as know, no theoretical way of calculating it, no formula, and I choose the hit-or-miss method as being likely to give me the results I want. So that the reader may appreciate more clearly what it is I am trying to achieve, I will set out my reasoning as I proceed.
It should be fairly obvious that the governing factor in dealing with the problem of making provision for a return load is the sum of the times needed (a) to proceed to the point of collection for the return load, after discharging the outward one, and (h) the time taken in proceeding to the original collecting point for the next outward load, after discharging the first one. Another point which must not be overlooked, although it may not be very important, is the dead mileage involved in travelling for the purposes just named. It is also fairly obvious that the class of traffic, particularly in respect of the time needed to load and unload it, is of consequence. In setting out to deal with the problem myself, I started by considering a lead distance of 15 miles. As a basis for terminal delays I took six minutes per ton for loading and the same for unloading, plus 10 minutes at each end of the journey for finding the responsible individual to whom collections or deliveries must be reported, obtaining signatures to documents, sheeting down, turning the vehicle round, and so on.
In the case of a 6-ton load it means that there must be 46 minutes delay. at each end of the journey, or 1 hour. 32 minutes altogether for terminal delays. As extreme accuracy is not merely unnecessary but impracticable in matters of this sort, I allowed an hour and a half at terminals.
On the question of travelling speeds I did, in the beginning, work my times out in a manner similar to that set out in the Report, that is to say, allowing slow speed for the first two or three miles, a little faster speed for the next five miles or so, and maximum speed above that; not quite the same as the Committee but having the same underlying principles.
must admit that my, average speeds came out a little higher than those reached according to the Committee's method, that is so far as short leads were concerned. Over this 15-mile lead Iassessed the average speed at 15 m.p.h., admitting, however, that in congested areas it might not be possible to maintain that average.
In my case, therefore, the travelling time for the whole distance would be 2 hours and the whole time without provision for return loads, would be 3* hours. Providing, therefore, that everything worked out according to plan, it should be possible to complete three journeys in a day at the expense of a little extra outlay in wages for overtime for the driver.
Assessing the charge on the basis of 7s. per hour and 5d. per mile, as recommended in the R.H.A. Rates Committee's Report, the minimum revenue for a return journey for a one-way load would be that for 3* hours at Is. per hour, which is £1 4s. 6d., plus 30 miles at 5d. per mile, which is 12s. 6d., a total of 37s., so that the rate would be 6s. 2d. per ton.
If the operator found it practicable to maintain three journeys per day as a regular thing then he would earn £5 1 Is. per day.
The Time That Is Involved
When a Return Load is Picked Up
• Now, suppose on this journey he attempts to pick up a return load. Assume that the terminal delays are the same as for the outward toad, namely 1* hours. Also assume that .half-an-hour is lost in travelling the four miles from point to point, picking up the, return load, and getting back from the place of delivery of that load to the collecting point of the next outward load. That means no more than an average of 15 minutes and two miles at each end of the journey, which is not excessive.
The time for the complete round journey with the two loads is, thus, 3* hours for terminals and 3 hours for travelling, which is 6* hours in all. For 6* hours at 7s. the charge must be 45s. 6d,, and for 34 miles at 5d., 14s. 2d., that is a total of 59s. 8d. It is sufficiently accurate to call that 60s., which means that he must charge a net figure of 5s. per ton, plus hi per cent. allowance (so as to provide for the fact that there will not be a full 5-ton return toad on every occasion), that is, we are providing for a balance loading factor of 60 per cent., so that his rate must be 6s. gd. per ton.
Nevertheless his expectation of revenue is only 12 tons at 5s, per ton, which is the £3 already mentioned. He cannot, with only one driver, complete two such journeys in a day, without exceeding the specified 11 hours laid down by law as being the maximum a driver must normally work.
If he collects a return load, therefore, his revenue is only £3 per day, whereas if be does not trouble about such a toad and is able to maintain his three journeys per day his revenue is £5 1 ld. per day. Clearly, therefore, if the above assumptions as to conditions be correct it is most unprofitable to pick up return toads over a 15-mile lead.
But let us look at the problem another way. Let us assume that the conditions are much more favourable to the collection of a return load. Suppose that the outward traffic is of the kind which is quickly loaded and unloaded, so that the terminal delays are short, say 30 minutes in all. The time for the round journey, excluding provision for a return load, is now only 24 hours and the charge is based on 2* hours at 7s., which is 17s. 6d., plus 12s. 6d. for 30 miles at 5d., making 30s. in all, i.e., 5s. per ton. If this promptitude in loading and unloading be maintained and if the traffic be steady then the operator will be able to handle four loads per day and make a revenue of £6 per day, charging 5s. per ton.
When Favourable Conditions Exist for Obtaining a Return Road Now, assume that he starts to look for return loads and has the same luck as on the previous occasion, that is to say, he finds a return load which involves a total of 30 minutes and four miles in picking up and setting down and returning to the starting point, but, nevertheless, involves an hour and a half, the normal time in loading and unloading.
His total journey time is now 11 hours for th'e outward journey, 2* hours for the return journey and 30 minutes for shunting. That equals 4* hours. The charge for that must be 31s. 6d. for time, plus 14s. 2d. for mileage, making 45s. gd., which is approximately 3s. 10d, per ton. Add 33* per cent, to that for the balance-loading factor and we get back to our figure of 5s. per ton, actually 5s. Id. He is, therefore, not able to offer his services at a lower rate.
On the other hand, he can make only two journeys per day, so that his revenue is £4 1 Is. 4d,, instead of £6. Therefore, even under those favourable conditions it is still not profitable to worry about a return load over a .15-mile lead. It seems clear, therefore, that 15 miles is not that critical distance which I am trying to discover, even when favourable conditions prevail, at least as regards one portion of the traffic.
Before proceeding farther, it may be of interest to compare my average speed of 15 m.p.h. with what is accepted by the R.H.A. Rates Committee.
According to that method the first three miles of any journey are travelled at 5 m.p.h. That means 12 minutes per mile and 36 minutes are necessary to cover that distance. The next seven miles are travelled at 10 m ph., which is six minutes per mile, and will take 42 minutes. The next five miles of my 15 miles are travelled at 15 m.p.h., which is four minutes per mile, making 20 minutes for the distance. Altogether I have 36, plus 42, phis 20, which is 98 minutes to travel 15 miles, an average of 6* minutes per mite. • This is rather less than 10 m.p.h., and I think that is slow, except in particularly congested areas. I should say thereare only about half a cloztn of these in the country and only one of them, that is London, would allow 15 miles within the specially congested area which limits the speed to 10 m.p.h.
For 20 miles' run the total time would be 118 minutes, which is practically six minutes to the mile, or 10 m.p.h.
In the next instance which I shall work out, that is relating to -a 20-mile lead, I propose to take 16 miles per
hour for the average speed. S.T.R.