THE HAULIERS' INQUIRE WITHIN.
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More About Establishing a Small Bus Service. A Consideration of the Effect of Overhead Charges on the Fare Bill.
ICOMMENCED last week to consider how best a small bus service might be established in a provincial town. I referred to the locality as an industrial one and showed that, in the circumstances which had been described to me by the inquirer, who wished to make a start with four large buses, it would be best for him to confine himself to ene carefully selected route, about three or four miles long.
I assumed that he had found such a• route, actually 3i miles long. I outlined a service which would meet the conditions which I assumed would exist, providing for four journeys an hour each way during the rush periods of the day and two journeys an hour in the slack tiraes. I was able to prove that this involved 16 hours' work a day for each bus, making it necessary to engage a double staff of drivers and conductors, each of whom would work eight hours a day.
I then passed on to the question of bus operating costs, and arrived at the conclusion that each bus would average 112 miles a day for seven days a week. The total useful mileage would, therefore, be 784 per ueek, with dead mileage equalling about' 2 per cent. of the total, making 800 in all. I showed that the running, cost (taking useful rniles•only into this calculation) would be 94l a mile, and that the standing charges, being 218 ls. a week, would bring the total operating costs up to 14.52d. per bus-mile.
The establishment charges in connection with this particular job will be carnparatively heavy, four being rather a critical number of vehicles—just too many to handle easily, without special organization, yet hardly enough to justify .a big outlay on premises, on plant, and on wages
of depot staff. .
To begin with, it will be necessary to have a couple of ticket inspectors on the road. They will each run away with 25 a week in wages. The man in charge at headquarters, whether he be called general manager or chief clerk, will want at least 27 a .week. In the garage, which, •with four buses in service, will have to embody a workshop, it will be necessary to , employ a charge hand and an assistant, together with two apprentices and a couple of labourers. The wage bill there will be at least £15 a week. A typist and office boy will be required, at 23 a week between them. The total wage bill, apart from drivers and conductors, will, therefore, be quite £35. Sundry postagea, stationery, and advertising will take up another 22 a week. The garage and workshop equipment will cost 21,000, the interest on which will be the equivalent of a pound a week, whilst depreciation and maintenance of that equipment and fittings 'will swallow up £3 a week. Allowing 21 a week for sundries, tickets, etc., we arrive at a total'of £44 a week for the four vehicles, or 211 a week per bus. This 211 needs to be divided by 784, in order to get at the effect of the establishment charges per busmile. 211 divided by 784 gives us 2.37d. Add this to 14.52d., and the total, 17.89d., is the total cost per bus-mile of running this bus service. Now we come to the question of profit. The initial B40
outlay in connection with a business of this kind will approximate to £8,000. Ten per cent. on £8,000 is 2800 and 15 per cent. is 21,200. I should say that,, for a business of this kind, 10 per cent, is the minimum which would tempt any man to invest ; the risk is too great for a less percentage to be attractive. Fifteen per cent. is a more reasonable figure. If we split the difference, and take 124 per cent., we shall not be very far out. Twelve and a half per cent. equals 21,000 a year—say 220 a week. 25 per week profit per bus per week, spread over 784 miles, will equal 1.53d. per bus-mile. If this be added to the operating figure we have given, namely,, 17.89d., the total, 19.42d.---say is. 7d.--is the minimum return in fares per bus-mile which must be got.
Now we come to the matter of fares per passenger, or, more strictly, fares per passenger-mile. If every bus ran every mile with its full complement, our task would be easy. We should have to obtain from 56 passengers, 19.5d. a mile, which means that the fare per passenger would be 0.35d. per mile—just a little less than three miles for a penny. A threehalfpenny fare for the whole journey would pay hand-` seimely. A fare of a half-penny a mile would bring in a profit of 10d; a mile or £130 a week from the four buses—what a hope ! Unfortunately, these conditions are impossible of attainment ; they do not even obtain during the rush periods, for then the traffic is in one direction only. The buses travel one way full, but are empty or practically empty, on the return journey, so that, on the average, we may say that, during the rush hours, the buses are half full. That means that, even in the busy hours of the day 28 passengers, instead of 56, have to find the is. 7id. a bus-mile. This condition would increase the fare per passenger-mile to 0.70d., or nearly id.
We are not, however, even so well off as to have our buses, on the verage throughout the day; only half full.' That will only be the caseduring, the rush hours. There will be Plenty of journeys during the middle of the day, when the number of -passengers will only be half a dozen or so each way. Over the whole day the average for each bus can be worked out roughly as'follows : Eight hours of rush 16 journeys (eight each way), with an average of 28. passengers. During the remaining eight hours of eight journeys (four each way) the buseS will carry six passengers in each direction. The total number of passengers will, therefore, be 16 X 28 plus a x 6, which is 448 passengers on 24 journeys—an average of 21 per trip, in round numbers. Twenty-ono purpie, therefore, have to find, between them, is. 744E, which is, as near as makes no matter, a penny per passenger per mile.
The Problem of Fixifig a Fare which is Attractive.
• A penny a passenger-mile can be considered as the theoretical rate ; it is the rate which must be obtained, under the conditions enumerated, if a reasonable profit is to be made. It may prove, in actual practice, quite impossible to obtain such a rate. The people who should be passengers may think it high, and may walk; not all of them, of course, nor all the way, but sufficient may make it convenient to walk to turn our average of 21 passengers down to a lower figure, thus increasing the necessary rate. There may be competition at a lower rate—rate-aided competition, for example. A bus ride is like any other commodity; it sells in the open market for what it will fetch, not necessarily for what it is worth, and it may very easily happen that "what it will fetch" or even what it is worth to the rider (for few people could set a value on the portion of their time saved by the riding) may be less than the profitable rate.
.These are circumsfa,nces of which I know nothing. I mention them as being matters for consideration by the man on the spot (my correspondent to wit), lest he should, on my calculation of a profitable rate,
plungefoolishly—into this • enterprise, withou 'first inquiring whether there are any
reasons, either those I have mentioned or others which I have not, that may prevent his obtaining that' rate.
Of course, there are other ways of working. tht service; I have not space to consider them all. Speeding up during the rush periods, so as to increase the number of trips per hour to five, woulc increase the daily mileage, reducing the incidence oi the standing charges, the establishment costs, and the profits, enabling the .fares to. be reduced accordingly. Decreased fares during the quiet hours of the day may increase the nomber of passengers at that time to such an extent as to rnake,the reduced rates show st profit. Some little discretion should be used, too, in outlining the stages, particularly where they overlap. .Let, a stage start at a popular point, and end likewise ; have a. longer stage, if it seems advisable; at one point in the route, to attract those who would think twice about putting down a penny for a short run, making it up by a short stage elsewhere, where the prospective clients are not so particular. It often pays to keep the fare for the complete journey On the top side—provided there is no competition, for there is no question then of walking it. I mean that there should be no need to cut that fare. but I do not suggest that an exorbitant figure should be. asked.
The arrangement of the hours, and the manner in which the day is split up into busy and slack periods, may not be as I have suggested. Moreover, there may even be, in colliery districts, times when the heavy traffic runs both ways. My correspondent may be able to calculate these things for himself. If he cannot, then he should Write me fully, and I will do it for him. That is the most I can do, and I can -only offer.to do it willingly.
TEE SKOTCH.