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Look at your costs Male
Page 43
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ROAD Haulage Association national chairman Jack Male has issued a plea to operators to look at the costs of replacing their vehicles.
"You may be making allowances in your charges for increases in running costs, but are you making enough to replace your vehicles?" Mr Male asked.
He warns that if a haulier bought a vehicle costing £5,000 five years ago he probably made arrangements to charge depreciation of £5,000 to his accounts to replace that vehicle.
But Mr Male says that the vehicle will now cost £12.000 — and that illustrates the need for a change in charging policy. Mr Male has asked hauliers to recast their profit and loss accounts to show depreciation at the 1977 costs of the vehicles and not the "historic costs."
"It will also demonstrate just how inadequate your capital resources and the extent to which you are undercharging," he said.
The plea comes in a letter sent to all RHA members and Mr Male says that members should consult their local area secretaries if they need more information on inflation accountings.