PROBLEMS OF THE HAULIER AND CARRIER.
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Making Full Use of the Operating Costs Tables. The Basis Figures of the Calculations.
VLEET managers and all others interested in trans
port matters should carefully preserve the issue of The Commercial Motor dated February 17th, particularly pages 21 to 25 inclusive, in the event of their not having filed it already. These pages, which contain the Operating Costs Tables, provide just that information which is required by all who use motor vehicles for business purposes.
The figures are compiled from many submitted by various users, classified according to the conditions set forth in the heading of each table. As is obvious, there are many marked discrepancies in the figures given by one user and another for the same class of job, but averages have been taken in every case.
In applying the tables to any special purpose, I would remind all that the figures given must not on any account be taken as definite for all cases. With the possible exception of " Licences," every figure will almost certainly vary from those recorded by other users. Circumstances alter matters and a few moments' reflection will suffice to show that no man can prophesy to one place of decimals the exact cost of, say, fuel per mile for any particular vehicle.
Employing the Tables for Compiling Estimates.
Taking one instance of the practical value of the tables, there is the use for purposes of compiling estimates. The managing director may want to know what the cost will be of running a five-ton wagon and the respective costs of steam and petrol as prime movers. There are few men, even with many years of experience, who would care to give a rough estimate for running steam or petrol wagons for varying mileages at a few minutes' notice or to report upon the respective merits of steam and petrol as regards the cost per mile, without a considerable amount of study in order that they might be reasonably a,cmirate in their results. A few moments' calculation will produce the required figures for the guidance of those responsible, after consulting the tables and working out the necessary figures in accordance with the job under review.
To those who have in mind entry into the hauling and carrying world as a means of earning a living, there is always the cost bogey to be dealt with. Judging by the number of letters which I receive from prospective mechanieal transport owners on this subject, the scope for the tables in this respect is enormous, May I be permitted to give one word of advice to those who consult the figures when planning their first estimates ? Do not be misled into thinking that these figures represent the maximum, costs. , They are average figures, compiled by those who have had years of hard-earned experience, and they have given the benefit of their knowledge to others. If provision is made on the bases given, any extra profit (that is really such!) is all to the good. The first year or two of a new business, however, are apt to be more expensive than was originally estimated.
The Tables Assist in Fleet Manipulation.
Users of commercial motor vehicles do not always keep a large range of types, as to do so would be extravagant in the majority of cases. A problem sometimes arises as to whether it is cheaper to use two small vehicles, for instance, which form part of a fleet, or to hire a larger pattern from an outside , source. By looking up the ; Haulier's Figures" and making the necessary simple calculations, the answer may be discovered without delay and with a reasonable degree of accuracy. Comparing actual results, obtained from a year's
running of a fleet, with figures provided by other vehicle users is not always easy, as their systems of compilation may vary, and their working conditions may be entirely different, besides which there is frequently a reluctance on the part of responsible persons to divulge what is, in many cases, information of a confidential character. The system upon which the tables have been drawn up is an old and welltried one, and the data may be taken as applying to a reasonably wide variety of cases. Differences between practical results and the tables should be investigated in order to discover where the discrepancy arises. The basis figures of the tables are as follow :—Fuel at Is. 3d. per gallon; lubricants at 48. 6d. per gallon ; solid tyres, 12,000 miles' life ; pneumatic tyres, 9,000 to 10,000 miles' life. For arriving at depreciation a vehicle life of seven years has been taken. These will have to be remembered in event of "result" figures emanating from different prices in the first case. For instance, a large contract forfuel may reduce the initial cost, and, consequently, there will be a variation in the fuel item per mile run.
For the owner of motor coaches who proposes to enlarge his fleet or change the type of vehicle employed, there is frequently the uncertainty as to the financial wisdom of the step he may have under consideration. Local conditions, obviously, have to be taken into account, but, generally speaking, an estimate of cost per mile is of great value, in that it enables him to calculate the fare per passenger-mile which will have to be charged to produce the desired season's revenue. The respective costs of a, large or small vehicle have to be weighed up before embarking on the summer programme, in the event of new vehicles being desired either as replacements for those comprising an existing fleet or as a means Of extending the business.
Assistance for Readers.
The Commercial Motor is anxious to assist its readers at. all times in connection with problems of cost, and if there should be any particular point which arises with regard to the application of these tables to every-day business matters, an inquiry will be dealt with gladly. In. submitting queries of this nature, readers are requested to make questions as general as possible, as, of course, it is not feasible to introduce too much local colour into published replies. Quite a number of readers omit detailed information in their letters relative to costs, consequently delay is caused in replying, as too much assumption is not advisable.
Speaking generally, the information required is a brief specification of the vehicle or vehicles concerned, such as :—Two-ton Puller, solid tyres 1924 model, tipping body, cost 2650 new, etc. Secondly, the full details of the work should be set forth, particularlyitemizing conditions which can affect the operating costs in any way. Working hours, number of men employed, districts, natures of loads, number of days per week upon which load will require handling, distances between garage and loading points, distances between loading and unloading stations, suggested rates, etc.
The foregoing details may appear very formidable, but they merely constitute the information which any man must know when making out estimates for a job. In the omission of data lies one of the principal causes of rate cutting or under-estimation. It is a very easy matter to overlook details, but the items in the left-hand columns of the tables serve admirably as reminders.