Solving the Problems of the Carrier
Page 65
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Bumper Crops for Hauliers
When There Is a Heavy Demand fir Transport, an Operator Can Raise His Charges, But It Is Surprising How Many Hauliers Will Cut Their Rates at the Behest of Canny Customers-a Condition Which HasReturned from Pre-War ATthe close of my article last week I set out the fixed charges for a petrol 5-tonner engaged upon municipal work. These were: Tax, 14s.; wages, £8 10s.; garage rent. 6s.; insurance, 16s.; interest, I2s.; and establishment expenses, £3. The total of these items is £13 18s. On to that, the operator must add not less than 20 per cent. for profit, so that his revenue per week on account of fixed costs only must be £16 14s., which, on the basis of a 44-hour week, is 7s. 6d. per hour to the nearest penny.
For the running costs I propose to take the figures in -The Commercial Motor' Tables of Operating Costs:' hut I must first deal with increases in expense which have occurred since the Tables were published. The price of fuel has risen by approximately 25 per cent, and so has that of lubricants. Tyres are 10 per cent. dearer and maintenance costs have gone up by a similar amount. Another 4s. a week has been added to wages. and insurance premiums are 121 per cent. higher
Today running costs ol a 5-ton petrol vehicle are as follows: Petrol, 5.50d.; lubricants, 0.27d.; tyres, 1.38d.; maintenance (d), 0.88d.; maintenance (e), 1.80d.; depreciation, 2.41d. The total is 12.24d. per mile. Add 20 per cent. as before for profit, 2.46d., and we get the mileage charge of 14.7d. This means that for the hire of the vehicle there should be a time charge of •7s. 6d. per hour plus 14.7d. per mile. It is important to realize that the mileage charge is additional to the time charge. I have found in the past that readers are apt to imagine that the time charge includes amounts to cover running costs.
When reckoning the mileage which may be run per hour. the conditions of the job must he considered. In an average provincial town a vehicle will rarely exceed 30 miles of running in a 81-hour day. This is approximately 3.1 miles an hour. The mileage charge of 14.7d. per mile, multiplied by 31. gives 4s. 33c1.. to which must be added 7s. 6d. as the time rate for an hour's work.
Rate Build-up •
If the vehicle covers more than miles in an hour. the rate must be increased accordingly. For example. where the mileage per hour is 41. another 14.7d. must be added to the total. This would make 13s. approximately.
These figures relate to 'vehicles operating in a Grade I area. This affects not only wages but items such as rent and rates, insurance, maintenance and establishment costsall of which tend to diminish as an operator's base moves farther into the country.
Now I will change the subject. I recently stayed in a potato-growing district to investigate some of the problems relating to the haulage of potatoes. It is not the case that if a grower reaps a small crop he is at a heavy disadvantage compared with if the crop were heavy, because prices fall as yields increase.
A haulier is not in the same position. His bumper crop, that is to say when he has plenty of work, usually means that he can raise prices rather than lower them.' In many trades today hauliers are obtaining bumper crops. Particularly is this so in building. There is no need to worry about having building vehicles standing idle. Hauliers are better off than farmers and growers because they have no middleman between themselves and their customers and can, within limits, fix their own rates. Most of them are doing so and are obtaining good prices.
A minority, however, is apt to succumb to the wiles of customers in a way which occurred before the war. Some hauliers are cutting their charges to a point where their profit is extremely small. Too often do I hear the remark that it is extraordinary how these operators will cut their rates at the request of a canny customer rather than risk losing his work. I was told of a man who carried bricks over a certain route for 17s. 6d. He also operated hire cars and his price for covering exactly the same journey with these was 11 10s.
He probably thinks that it is wise for him to keep himself in the good books of his brick customers, who are also important users of his hire cars, but he must be aware that the 2-ton lorry which he uses must cost more to operate than his cars. The lorry is treated with little care, is overloaded and has to negotiate rough ground. This man must know that he is not making a fortune with his cars, and yet he gives a service with a lorry at about half the cost.
Loaded Hot
Brick haulage is not the happiest section of the transport industry today because the demand for loads is greater than the supply. It may seem odd, but operators have to wait long periods in the brickyards before they can pick up their loads. I have been told that the bricks are being loaded direct from the kilns. They are really too hot to be handled, so hot, indeed, that even by the time that they reach the building site the bricklayers cannot easily take hold of them.
One thing which causes hauliers to accept low rates for brick haulage is that bricks represent " catch " loads. An operator who has taken a load on a long-distance journey may find that on the return run it is possible to divert slightly and visit a brickyard where he would he almost certain of obtaining a load.
1 have been asked to quote a rate for the carriage of Flettons. These weigh 2[ tons per thousand and are to be carried or 5-6-tonners at 2,500 a load. This work is arduous and involves high maintenance costs and increased tyre and chassis wear.
Taking a petrol-engined vehicle, the running costs are petrol, 54-d.; lubricants, Icl.; tyres, 2d.; maintenance, 2d.; and depreciation, 2.1d. The total is Is. a mile. Weekly standing charges are: Tax, 14s.; wages (including insurances, holiday pay and overtime), £10 10s.; vehicle insurance, .£1 10s.; garage rent and rates, 10s.; interest, £1 I2s. The total is .£14 16s.
Now let. us consider the operating conditions. The lead is six miles long and we should allow 2 hours for loading and unloading and Z. hour to cover 6 miles. The average time for a round trip will thus be 3 hours, which means that the haulier Will be able to carry three loads per day or 15 loads in a five-day week, a total of 37,000 bricks.
In the week he has made 15 12-mile journeys so that his total mileage is 180, At Is. per mile that is £9. Adding £14 16s. for standing charges and £3 for establishment costs. we obtain £26 16s. This works out at 14s. per thousand bricks. To this must he added 4s. for profit, making the rate 18s. per thousand.