HINTS FOR HAULIERS.
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An Occasional Chat on Subjects and Problems of Interest to Those Who are Engaged, or About to be Engaged, in Running Commercial Vehicles for a Living.
AT ONE TIME it was possible to calculate the cost of running various types and sizes of commercial motor vehicles, tabulating the results and setting the tables aside for ready reference as occasion demanded. The fluctuations in price of the various commodities which were required in connection with a motor vehicle were neither so frequent nor so violent as is now the case-.
In the -course of many years' e-xperience of the trade, extending over a period which goes back to the time when .petrol was 10d. a gallon, and could be purchased in bulk for practically half that sum, during which I have made a continuous study of this ' important subject of costs, I never recollect a time when it was so difficult to prophesy, even for short periods ahead, what the cost of. working -a fleet of vehicles would be. The present situation in this regard is not only full of difficulty, but also quite unstable. The price of petrol has recently been advanced by 7d. a gallon, approximately 20 pet cent. an the net tax-free price, and there, is no indication whatever that even this present increase will be the fast or that the price is likely to remain undisturbed for long. The cost of oil, and lubricants generally, usually moves more or less in sympathy. with petrol. The price of paraffin, toe, increases in the same ratio, and, although it is, as yet, rarely used as a fuel for commercial motor vehicles, its price, nevertheless,does enter into our calculations in a minor ,degree owing to its use for claming and similar purposes.
The steamwagon is hardly in better case as regards recent fluctuations of the price of its fuel, although, apart from the present threat of a strike and its inevitable permanent, effect on that prices the future in regard to this fuel is less uncertain. Even there,..however, it is not too safe to prophesy, and one has to remember, that, so complex is our industrial system, and so interdependent the main sources of our .supplies, that it is practically impossible for the cost of any single commodity to vary, to any appreciable extent, without its affecting that of all the others.
A Table of Costs to Cover Fluctuating Prices..
In view of this uncertainty, and being strongly imbued with. the belief that conditions—at least, as regards liquid fuel—are not likely to settle for some time, I have been striving to discover some_ means of so formulating a table of costs that they could be used by the reader in accordance with the fluctuating prices of the fuels and other commodities used I have been unable to discover any simple means of effecting this, all those various schemes which presented themselves being cumbersome and inclined to complication to such an extent that, by using them, I should have fiefeated my-own object— that of preparing a sheet of costs which could easily he used and understood by the least, experienced of commercial vehicle owners. In the end I was compelled to fall back on a method which I have invariably used whenever faced by this problem on previous occasions.. I supplement the ialsles by. a textual description of the method of arriving at my results, carefully stating the basic prices on which the calculations are made, in the hope that, when fludtuations do occur, and correction becomes necessary, my readers may be able to apply my awn methods and work out new tables for themselves.
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Fortunately for us—at least, in'regard to, this question of working ant costs of running—the consumption of the various commodities such as fuel, oil, 'tyres, etc., -are fairly constant, and have been so for many years. Advertisements may claim economies of 20 per cent, for this carburetter, of 5 per cent. for that system of lubrication' may claim additional mileages on so-and-so's tyres, but a careful examination of statistics, compiled during the last tenyears,' and averaged from time to time gives but little indication of the general adoption of any of these economyaiding devices, which is surprising, to say the least of it. It is, therefore at all times easy to get back to an original table Li consumptions and to apply new current prices of the commodities there named in order to estimate actual costs, and as these articles are wsitten chiefly with a view to helping recruits to th: siness, I think we might begin by entunea-ating these various items.
Petrol andTyres Often Regarded as Chief Costs. • Ask the average motorist or motor lorry driver what it costs to.run his machine, 'and he will almost invariably answers " Oh, she does, such-and-such a number of miles per gallon." Perhaps one out of ten may add casually: "And she is very light on tyres," these conveying the impression that once the petrol and tyres' are paid for there is nothing more to consider. It requires very little consideration to enable one to realize that this is, unfortunately, very far from being_ the case. It is a fact, however, that lack of realization of the proper incidence of the various items in the running cost of the motor lorry has been responsible for the financial downfall of very many novices to the motor haulage 'business during the • two years which have elapsed since the Armistice, which period, as we are in an excellent position or knowing, has been remarkable for the amount of interest which has developed in that business. Let us consider the whole thing ab initio. The first expense to which our intending motor haulier will be put is that which is involved in the -purchase of the lorry itself. (I do not propose to go into the question of deferred payments. Everything that follows, however, about the first cost of the lorry applies in the same way to the price of one 'bought on the deferred payment system, the only difference being that, whereas inthe ca-se of a cash payment, the man has only to reckon the interest against his costs, with deferred payment. he is paying the interest all the time during the years over which the payment is spread.) Return on Capital First Consideration. • Very well, then. In considering the first cost of the lorry and its effect on his working costs, the man should treat the money which he pays for the machine as money invested. •In the ordinary way, as matters, are at present, he could get eight .ar nine per cent. for it, less income tax. Therefore', before his lorry begins to pay for itself, it must return him, perhaps not the whole eight or nine per cent., but at least a reasonable amount ofinterest On the first cost. It is usual, in calculations of this sort, toreckon the interest as being slightly less than the bank rate, The latter is at present seven per cent., and, therefore, we will take six per cont. as-being the interest on the first cost of the lorry which has to be reckoned as a part of the working cost of the machine. Raving got the machine, he next has to find somewhere to put it, which involves him in rent, rates, water rate (because he must use water for washing), and the oust of either gas or electricity for lighting the garage. This is a charge which he will have to meet weekly, or monthly, or quarterly, as the case may be. It is a more positive charge than the interest on first cost, and is, therefore, less likely to be overlooked.
Petrol we need not spend a great deal of time discussing; it speaks for itself, particularly as regards its cost. Although there may be many men who., at first, would think that the amount expended on oil and grease is not large enough to make a great difference to the profit and loss account, they will eventually discover that it mounts up to a considerable total in course of time. The cost of lubricants is really quite an important item in the running expense of a motor vehicle. Tyres are new on. a new vehicle, and, particularly if they are solids, the owner feels that he has a. good stretch to run before he need anticipate any heavy expenditure on account of replaceinents. The time will inevitably arrive, however, when tyres must be replaced. It is far better to look forward to that time and to set aside weekiy a small sum towards their renewal than to take the risk of having to replace them at a time when for some unforeseen cause, circumstances will not allow of them, being paid for in eash.
The Small Items of Cost Which Mount Up.
With a lorry, the owner will, no doubt, purchase a few spares ; not a great many, for happily the modern motor vehicle does not frequently call for renewals of any of its components. It would be unwise, however, to go out without, at least, a couple of valve springs and valves, two or three sparking plugs, some contact-breaker spares for the magneto, and so on. I need not enumerate the list, for the driver will have his oen ideas on the subject. Then there' will be additionally one or two spares which he should have available in the garage for use as and when required, such as brake linings, clutch linings, and so on, From time to tittle the wagon will need overhauling, at a greater or less expense, according to the care which is expended upon it. I am assuming that expensive repairs are likely to became necessary only as a result • of accident, in which case the insurance company will have to bear the cost, although this is not to be read as meaning that one should make no provision whatever for mechanical breakdowns, which are not at all • times avoidable. Carbide for acetylene lamps, paraffin for oil lamps, occasional repairs to batteries and dynamo, and spare bulbs for electric lamps must, ohe or more of them, be considered as items in the running coat, and adequate insurance will fall into the same category. Paraffin is also useful for cleaning purposes, and it is also generally necessary to buy small quantities of cleaning rags and other materials. All these items, in.eluding the cost of touching up the body work or chassis occasionally with a little paint or enamel, and so on, come under the general heading "maintenance." Mile by mile the lorry will gradually wear out. Men who have had any experience in buying or selling second-hand machines will agree that, invariably, a leading question on the part of the intending purchaser is, " How many miles has she run 2" Care and attention will, of course, diminish the extent to which a lorry depreciates each mile, and will thus prolong its life. It will not, however, renew it entirely. The best of lorries eventually cies, just as does the strongest and healthiest of men. Some men live to be TOO years of age, to the general amazement of their fellows, but, for everyone that lives to be that age, a dozen or so die before they reach 20; and so it is with lorries. Some, well made and carefully tended, .last indefinitely almost. Many more are worn out long before they have travelled a fair mileage, because of the rough service which is demanded of them, and also, in some cases, because they are not built as well as they should be. Man, as is generally agreed, has what is called an allotted span. At any particular age he has a certain " expectation of life," and so it is with -a lorry. At any time in its life it may be expected to run a further stated number of miles before" it is done, and, on that basis, can be calculated the actual amount in pence of loss in value which accrues to the machine for every mile it runs. This is, therefore, equivalent to an actual expense of running, and it is generally called depreciation.
The Owner-driver's Driving Wage.
We have one more item to consider—the driver's wages—and here I know from experience I am up against rather a thorny problem, as it presents itself to the owner who drives his own machine. Such a man frequently imagines that, beeause he drives the lorry himself, he can afford to ignore thesquestion of driver's wages, charge a, considerably less sum for its hire accordingly, and so undercut his neighbours. That he can do so appears to be such an obvious fact that it is extremely difficult to controvert him. Perhaps the simplest way to look at the question is this: A man who is a capable driver and an experienced mechanic, a really good -man in other words, has no difficulty, even in these somewhat troublous times, of getting and retaining a job, for which he will be paid the trade union. rate ofewages. In such a po ' sition he has no responsibility beyond that of caring for his lorry. He had'invested no money, and is not in daily fear of losing some or all of it. He has not to trouble from day to day and from week to week as regards the never-ending task to find work for his machine. Why, therefore, should a man take all these responsibilities and worries and yet not even pay himself as much as he would get as a driver? Surely he is entitled to that wage, plus a fair profit on his undertaking.
Rate-cutting and What it Leads To.
There is another aspect of this matter, too, which ought to appeal to every man with even a limited amount of common sense. Doing business on the hues suggested—that is to say, cutting rates by eliminating the factor of driver's wages—is a pricecutting campaign pure and simple. It is a game which has never yet been tried -successfully in business, unless beaked by enormous capital and by a big firm ehich can stand a heavy immediate loss with the prospect of increased profits later on. I am nOt endeavouring, in these pages, to teach that sort of man his business. The ordinary single-handed motor haulier may not do it. If he tries, there will inevitably come a time when he will feel that he must either expand his businees or drop it altogether. To expand it, he must needs either' take a driver for his lorry or engage someone to manage the office end of his business, He will immediately find it impossible to go on charging the cut rates which have hitherto been the rule. He-will have to increase the charges to old and valued customers as well as to new ones, causing general offence tool' and sundry. As a result, he will most likely lose a good portion of that valuable asset in any business—the goodwill. Finally, if none of these arguments touch the intereseedoreader of these pages, then he had better take it from me as a straight tip that the only way to make even a single-handed haulier's business pay as it should, is to enter up in the accounts a proper item covering driver's wages, and to take care thatthese wages are covered before he reckons that any profit is being made. TEE SKOTCH.