Tendering for Mu al Contracts
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IN last week's article the basic figures, by which tonnage rates for loads of from one to six tons inclusive could be assessed, were given. Data relating to Grade I, H and III areas were set out. Using figures taken from those schedules, and calculating on the basis of a day's work for a vehicle, I showed how to arrive at rates for 2-ton loads, over leads of 1, 4, 6, 9, 15, 20 and 30 miles. I assessed rates which should be charged to-day, and those which should have' been obtained in September, 1.939. The difference amounted to nearly 30 per cent, In Table XIII, herewith, the rates based on current costs are shown. This 'table has been built up by taking -the rates for the various lead mileages mentioned above, and assessing those for intermediate mileages in proportion to the distances, The method of arriving at these rates may again be shown, this time in connection with a 6-tonner.
According to Table XII, reproduced with the previous article, the revenue from the use of a 6-tormer in a Grade III area, should be not less than Sc, 4d per hour plus (mark the " plus ") 93d. per mile, Those amounts are calculated on the basis of operating costs as they are to-day.
When I dealt with the 2-tonner I assumed, as is fair and reasonable, that it would be practicable to complete eight round journeys per day over, a one-mile lead. With a 6-tonner it would be safe to take seven journeys per day as the average. On that basis, allowing eight hours per day, one journey Lakes 1 1-7 hours, the charge for which, at Sc. 4d. per hour, is roughly 6s.
To that must be added the charge for two Miles (one mile out and one mile home) at 93d. per mile, which is Is. 70. The total charge is thus 7s. 70., which is equivalent to Is. 3i-d. per ton. As to that figure more later. It should be noted that the day's revenue is 53s. 41d. and the net profit approximately 9s.
It is probable that seven journeys per day will still be completed when the lead mileage is three. That being so the charge per journey for time will remain at Bs. The mileage charge is six times 90., which is 4s. /0d. The total charge is thus Ns. 100., and the rate per ten is. 10d. The day's revenue will, at is. 10d, per ton, be 23 17s. and the net profit nearly 12s. 6d.
Over a five-mile lead six journeys per day should be a practicable average. That is 1 hour 20 minutes per journey, for which the charge should be 7s. 2d., plus 10 times 91d., which is Ss. lid. The total is 15s. Sd., or 2s. 61d. per ton. The daily revenue is 24 us. 9d., and the net profit about 15s. 4d.
Similarly, taking five journeys per day for an eight-mile lead, the rate can be shown to be 3s. 60., the day's takings 25 6s. 3d., and the net profit 17s. 8d.
For a 12-mile lead the rate is 5s. and, allowing for four journeys per day, the revenue is. 26 and the profit £1. Over 16 miles the rate is 6s. Bid., three journeys bring a revenue of 26 Os. 9d. and a profit of 21. A lead of 24 miles limits the number of journeys per day to two: the rate is 10s. Id., the revenue 26 is. and the profit is, again, £1.
I have calculated these various figures for daily profit to demonstrate that there is an inadequate return in connection with the ultra-short leads. The reason, of course, is thefl excessive lost time and that, for reasons given in the. previous article, is unavoidable.
In Table XIV I have set down the rates as calculated above, and, by filling in the rates for intermediate mileages in proportion, built up a reasonable schedule of rates. I have artificially increased the rate for the one-mile lead, so that the work over that distance shall show a reasonable returnI do not regard 95, per day as sufficient, in connection with the operation of a 6-tonner. AL i.e. 6d. per ton the revenue will be 23 3s. per day and the net profit 18s, for the same pelio.d.
There is, however, a more logical way of assessing rates for traffic such as this-and for many other kinds as well. It is a method first used by me, following a suggestion from Mr. Harry Wood, the well-known. Huddersfie-ld coal merchant, when I drew up a schedule of rates for coal haulage, some years ago. That was the first real attempt to schedule haulage rates on a cost plus profits basis. It mias a success, and it served as a model for many others. According to that method, a basic rate is calculated according to the net time for the performance of any particular journey, including terminals. To the time charge thus assessed is added the cost of the mileage. In order to allow for lost time and diminishing profits on short and ultra-short journeys -this basic rate is increased by the addition of an amount which increases as the lead
shortens, rising to a maximum when the lead is one mile.
To show how the 'procedure can be applied in the case of sand and ballast haulage I will again utilize the time and mileage figures for a 2-tonner, operated in a Grade III area. These were set out in Table XII in last week's article; they are, 3s, 7d. per hour and 6id. per mile. It has already been agreed (see previous article) that a fair allowance for average terminals in the case of chute. loading and tipping is 15 minutes, also that 15 miles per • hour can be taken as the average rate of travel. Using these figures, first calculate the terminal charge per ton. The rate for 15 minutes at 3s. 7d. pm hour is 11d. That is for two tons, so that the terminal charge per ton is 5id. (See Table XV.) For each mile lead the vehicle runs two miles. It takes eight minutes to travel that distance, thus involving a charge of Sid. for time, to which must be added Is. Oid. for two miles run; the total mileage charge is thus is. 6d., or 9d. per ton, as set down in Table XV., By adding the terminal charge to the mileage charge the net rate is reached, thus, for a one-mile lead it is 5id. plus 9d., which is Is. 2id. That compares with the rate of 2s. 6d., quoted in Table XIII, and is deficient because no provision is made for the loss of time and diminution of profits which are inseparable from these ultra-short journeys.
It is convenient, and reasonably accurate, in connection with sand and ballast haulage, to assume that these troubles have disappeared when the lead mileage exceeds 12. At a lead of 13 miles, as appears in Table XV, the net rate of Is. 111d. per ton is also taken as the total rate, being corrected to 2s. solely with the object of eliminating the odd id. from the rate.
As the lead diminishes, what is called " weightage " is added to the net rate. Thus, for a 12-mile lead add Id.; for 11 miles add 2d.; for 10 miles 3d., and so on. Usually, that process is continued right down to the one-mile lead which involves a weightage of is. In this case, however, I have deemed it advisable to increase the weight4e, as• shown in these tables, for one-mile and two-mile leads.
Tables XVI to XIX have been compiled in a similar way, using the figures for time and mileage set out in the previous article. The difference between the rates for 6-ton loads according to whether the work is done in a Grade II or Grade I area is so slight that I apply the same schedule
to both areas. S.T.R.