Solving the Problems of the Carrier
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Road Speed is a Factor ates Assessment
HAULAGE contractors with the minimum of experience and knowledge cannot do otherwise than appreciate the importance of speed„ as a factor in total expenses of operation. The more miles per week the less the cost per mile and the less, therefore, the
profitable rate per mile. . .
The briefest of references to " The Commercial Motor " Tables of Operating Costs will make that abundantly clear. A778-ton petrol vehicle travelling 200 miles per 'week costs 19.72d. per mile to run and a minimum fair -charge per mile is 2s. 40. If it runs 1,000 miles per week the cost is less than half, being 9.70d. per mile and the corresponding rate is Is. Oid. per mile.
But apart from the Tables, it quickly becomes apparent to any hauher that if he can cut journey times he can cut costs. Moreover, if the cost be diminishea, the rate can be lower and still return the same margin of profit. All this, apart from the fact that by an increase of speed it may be possible to .squeeze an additional journey into the week and the profit on that journey then becomes what is commonly known as " bunce."
Moreover, the time taken on any outwafd journey is an important factor in determining the practicability of
obtaining a profitable return load. Other things being equal, the slower the speed of travel the longer the journey until it is unprofitable to waste time looking for a return load. • Critical Limit of Journey Length • If, for the sake of argument, it be accepted that it is uneconomical to seek a return load over a lead of less than 70 miles, it being preferable to get back quickly and pick up a second outward load, that being approximately the case in respect of a vehicle with a maximum speed of 20 m.p.h., it may well be that the critical limit of journey length can be reduced to 50 miles if the speed of operation be increased to 30 m.p.h.
Speed, therefore, is doubly important. Any haulier who is assessing what would be a profitable rate for any particular traffic must take speed of travel into account
when making his calculations.rates for haulage whenever they are fairly calculated so as to show a reasonable profit, are assessed with this factor well in mind.
What appears isa be overlooked by a good many leaders in the industry to-day is that -the question of existing legal speed limits is closely 'linked with this problem Of rates assessment.
Any independent investigator, asked to form a schedule of rates. Must, in the process of making his 'calculations, follow the same course. In doing' so he is at once faced with rather a nice problem. He is, of necessity, well aware of the fact that there are irf force, in this country, certain reg-ulations governing the speed at which commercial
vehicles can legally travel. .
If he be wise and far-seeing, his calculations must be based on the assumption that the legal speeds are not habitually exceeded. His justification for making that assumption is the fairly obvious belief that whatever may be present' and past conditions, it is most likely that, in the future—although possibly not during the war—the laws relatiag to speed limits will be strictly enforced. In that event, rates calculated on the basis of speeds in excess of the legal maximum will be insufficient and will need considerable amendment in an upward direction if they are to be profitable to the haulier. Consider, in this relation, the procedure which is being followed by the various Regional Committees of the Road and Rail Central Conference. To the best of my knowledge, these Committees are collecting data for actual rates in force amongst hauliers relating to specified streams of
traffic. Assuming, as is reasonable, that the vehicles operated by many operators are habitually driven at speeds beyond the legal maximum and that these hauliers have assessed their rates on their actual experience, then the conclusions of the Committee and the rates which it puts forward for these various streams of traffic are likely to be insufficient and the whole scheme of rates schedules upset if, after the war; the law be enforced.
Drawing a parallel from the experience of passengervehicle operators, it seems most likely that that will be the case. It is common knowledge that the scheduled times of long-distance coaches are carefully scrutinized by the Regional Transport Commissioners with a view to ensuring. that there is no need for the coaches to exceed the legal limit of 30 m.p.h. in order to maintain the scheduled times.
Moreover, the question of speeds of goods vehicles has, on many occasions, been raised in the traffic courts and elsewhere and there have been attempts to take departure and arrival times as a basis for calculations which go to prove that the speed limit has been exceeded.
That being the case, it behoves all those who are concerned with rates assessment and the building up of rates schedules to revise their calculations, with a view to ensuring that this particular and important point has not been overlooked.
Formula. for Rates Calculation , A rational formula for the calculation of rates for particular traffic must be deduced from ascertained data. This will relate to loading and unloading times, including known information as to the possibility of terminal delays (usual in connection with that traffic), terminal delays, such as waiting turn at docks or other loading and unloading places, plus allowance for travelling time based on the assumption that the legal limit of speed is not exceeded.
From these figures a total time for the round journey is ascertainable and the amount chargeable on the time basis assessed, taking an agreed figure for rate per hour based oncost plus profit. In addition, there is the mileage charge and this must be calculated -by taking the actual number of miles travelled and rating it at a similarly agreed figure per mile,,again based on cost plus profit.
Loading time must, obviously, vary according to the class of traffic as also must the unloading time, but a good
average figure which applies to the majority of materials carried on trunk services is as follows :—For loading, 10 minutes per ton of load plus 15 minutes for turning. round, that is to say, the completion of documents, sheeting up, etc., before the vehicle actually •starts en its journey.
As a rule the unloading time is approximately the same, that is to say, 10 minutes per ton of load plus 15 minutes for turning round, which includes packing up of sheets and ropes, etc., before commencing on the return journey. As to travelling time, -provision -should be made for the fact that at both ends of the journey the vehicle will almost certainly be travelling through some miles of congested traffic and a fair figure to take is 10 miles at each end. That is 20 miles per journey, over which the average speed with a 20 mph.. vehicle will not exceed 12 mph. For the balance of the journey, if the legal limit of 20 m.p.h. be not exceeded, the average speed is not likely to be more than 18 m.p.h.
A 10-tonner Provides a Test Case It is now of interest to apply the above principles to a particular problem whiclihas been put up to me relating to the operation of a 10-tanner in connection with three journeys, i.e., from A 10 B 108 miles, from A to C 192 'miles, and from A t,ó D 210 miles. I have been informed that the actual cost figures for this particular vehicle amount to 8s. 6c1. per hour standing charges, including overheads or establishment costs, and 6c1. per mile running costs. Adding 20 per cent. to the above figures lor net profit we arrive at the basic charge of 10s. per hour and 7d. per mile run. The loading time will be 10 times 10 Mirates pins 15 minutes for turning round, which is 1.15 minutes. It will certainly he sufficiently accurate to take two hours for the loading time and the same for unloading. I am informed that there is no need to make provision for any other terminal delays so that four hours is the basic figure to cover loading and unloading.
Dealing first with the journey from A to B (108 miles), 20 miles of that is assumed to be covered at 12 m.p.h., which takes 1 hour 40 minutes. The remainder of the journey, 88 miles, is covered at an average speed of 18 m.p.h., which is 6 minutes short Of 5 hours. The total timefor travelling one way can thus beassessed at approximately 6.1 hours, and the complete period for the return journey one-way loading will thus be 4 hours for load handling plus 13 hours travelling, 17 hours in all.
The charge can, therefore, be assessed as 17 hours at 10s. per hour, which is £8 10s., plus 216 miles at 7d. per mile, totalling £6 6s., the charge for the complete journey thus being £14 16s.
Now, in assessing a rate for a paeticular traffic, which -must be generally applicable under normal conditions of operation, there are three other factors which should be taken into consideration, besides those-already enumerated. The first is that no -vehicle is fully occupied for 52 weeks
in a year. A good average for the total number of working days per annum is 260, which means that approximately one-twelfth of the time charge must be added to the . oregoing to make up for the loss owing to the vehicle being idle—that is an addition of approximately 14r , bringing the total to £15 10s., which is 31s. per ton.
The second factor is that, in trunk service:, P is rarely the case that the load can be disposed of in one pick up and one drop and to cover delays on account of frequency of additional drops is. per ton should be added t, the calculated rate, which thus becomes 32s. per ton The third factor is provision for earnings by way lef return loads. Eor the purposes f this article I propose to. ignore that, because it eomplicates the calculation witl out having any immediate be'aring on the point which 1 wish to make in resperA of these three particular journeys Making a calculation on similar jines on a journey from A to C (192 miles) we get a total travelling tilne of 11 hours each way, 22 hours in all, plus the 4 hours for loading and unloading, making 26 hours. The rate is thus 26 hours at 10s. per hour, which is £13, plus 384 miles at 7d., which is £11 4s., a total of £24 4s. Add one-twelfth of the time charge to provide against losses due to idle days and we get £25 Us., which is 50s. ed. per ton. Adding a further is. for the prevalenee of more than one drop per journey, we get the liral figure of 51s. (Id. per ton.
Going through the same process for the journey from X to I) (210 miles) we get 50s. per ton.
An Operator's Good Vehicle Times
The operator who raised this question with me makes much better times with his vehicles ; indeed, they are '0 good that I shall most certainly have to refuse any request to disclose his name or address. He tells me that he covers the journey from A to B in 4 hours, from A to C ih 6i hours and from A to D in 7i hours,
Revising the calculation of rates, in accordance with these new data., then for the traffic from A to B we have a .total of ,8 hours' travelling and 4 hours' terminals—he tells me he accepts my figures for loading and unloading times—that is 12 hours in all, which, at 10s. per hour, is £6. Add the £6 Os. for the 216 miles at 7d. and we get a total of £12 6s. Ada to that one-twelfth of the time charge for the idle days, a further 10s., giving a total of £12 les., which is approximately 25s. 6d. per ton. Now add the is. per ton for additional drops and we get Ms. ed. per ton as being the appropriate rate, compared with 21e. per ton calculated on the assumption that a legal limit is not exceeded.
Applying the same reasoning and calculations to the other journeys, it can be shown that the new rate „for A to C should be 42s.; compared with 51s. 6d., and the new rate from A to D should be 46s., compared with 56s.
These are big differences and it behoves every operator Who is representing his fellows on these Road. and Rail Regional Committees to bear this particularaspect Of the subject in mind when collecting information as to current rates for traffics" carried at speeds• Which, -when the .law is more strictly applied, as inevitably it must be, -will not be possible.