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How to Tender , for a

25th January 1946
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Which of the following most accurately describes the problem?

Small Municipal Haulage lob

The Calculations to be Made When Tendering to a Rural District Council for a Comparatively Small Amount of Haulage

THE problems with which we have been dealing of late have been somewhat of a complex order. It is something of a relief to be able to turn to a problem of a m■re. simple nature but, nevertheless, which has certain peculiarities. It is, therefore, likely to be difficult of solution by the ordinary small haulier who has not had much experience of assessing costs for this kind of work.

The problem I have before me is that of contracting for haulage to a small district council in connection with its gas works. The particulars I am given are these: there are about 3,500 tons of coal per annum to be carried from the station goods yard to the gas works, a distance of approximately three-quarters of a mile. The coal is hand loaded from the railway wagons into the motor vehicle and at the other end may be tipped or sometimes hand off-loaded.

In addition, there are about 1,000 tons of coke per annum to be delivered in small quantities to householders within a radius of approximately three miles from the gas works. Then there are some 50 to 100 tons of general products, which, I assume, to be by-products from the gas works, to be taken during each year from the works to the station. Finally, the vehicle must be used about eight hours per week on the delivery of gas stoves and similar appliances, presumably over the same small radius as the deliveries of coke.

The last item gives a clue as to what is in the mind of the operator. He is apparently of the opinion that the work can be done quite easily with one vehicle and that this period of eight hours spent in delivering gas stoves, etc., will usefully fill up the time during which the vehicle might be idle.

What Had to be Assumed I tackled the problem first from that point of view, but eventually came to the conclusion that, so far as I could see, one vehicle could not cope with the work thus described.

I had, as usual, to make a considerable number of assumptions to fill in the blanks in the sort of schedule of information for which I would have asked had there been time.

First as regards the coal. I should imagine that, in a gas works, the deliveries of coal are much greater during the winter than in the summer. It would not, therefore, be feasible to assume that 3,500 tons were delivered in equal quantities each week throughout the year, at the rate of about 700 tons per week. Instead, I took it that 1,000 tons would be delivered during the 20 weeks of the late spring, summer and early autumn, giving me a tonnage of 50 per week during that period, and that the balance of 2,500 tons would be delivered during the remaining 32 weeks of the year, giving me 80 tons each week.

Similarly with the coke. Of the total of 1,000 tons, I assumed that 200 would be delivered within the 20 weeks, equivalent to 10 tons per week, and the balance of 800 tons during the 32 weeks, necessitating an average delivery of 25 tons per week.

Of the remaining work, I took it that the cartage of 50 to 100 tons of by-products would not mean more than

2 tons in any week. Even if it did involve double that .quantity, the amount was not worth serious consideration. However, I did carefully register the fact that it was anticipated that eight hours of each week would have to be set apart for deliveries of gas fires, gas stoves, etc.

What that means, assuming a standard 48-hour week for the vehicle, is that we must deduct from that total eight hours for these miscellaneous deliveries and, possibly, another hour or so for the delivery of the by-products. It might be safe to assume that the by-product deliveries, as well as the gas stoves, and so on, would have to be taken care of within the eight hours, leaving us 40 hours net for the coal and coke deliveries. On that basis I set about estimating how the work could be done with one vehicle.

Naturally, I commenced by taking the winter period, because if one vehicle could do the work then it could cope with it quite easily during the summer. Clearly, if we assume the vehicle to be a 2-tonner it must in that one week of 40 hours net, deliver 40 loads of coal and, say, 12 loads of coke. (That assumes the man was able to convey 25 tons of coke in a 2-tonner in 12-loads—not at all an unreasonable assumption.) Insufficient Time Available

It was immediately manifest that the work could not be carried out in the time. Even with help in loading the 2-tonner with coal in the station yard, it could not be expected that the vehicle would, day in and day out, be able to complete more than 10 round journeys per day. Therefore four full days, that is 34 hours out of our allotment of 40, would be needed for delivering the coal alone, leaving only six working hours in which to make 12 houseto-house deliveries of coke in bags—out of the question.

Nor does increasing thesize of the vehicle help us to any appreciable extent. It is not to be expected that a 4-tonner, having to be hand-loaded at the station, could make the round journey under an average of 11 hours, say six round journeys per day. As 20 journeys are necessary to complete the full tally of 80 tons per week, that.would bring us, again, to 31 days, leaving insufficient time to deal with the coke.

I had, therefore, to conclude • that no matter which way we tried to do the work, two vehicles would be necessary. I did not overlook the possibilties of using a mechanicalhorse type, but turned that down because it seemed to me that insufficient time would be saved.

Working with a vehicle of that type the routine would, imagine, be something like the following. An empty tipping trailer would first be left at the station yard to be filled. While that was going on, and I assume a period of half an hour for a 2-ton load, the motive unit would run back to the yard with a trailer that had already been filled. Assume five minutes at the station-yaxd end manceuvring into position, changing trailers, and so on, five minutes for the run back to the yard, a quarter of an hour for off-loading the coal by hand, five minutes to run back again to the yard and another five minutes to change trailers, the total time for the journey would, probably, be 40 minutes, as against the 45 minutes assumed as being applicable to the ordinary type of vehicle.

The point at issue is, of course, that if I cannot actually reduce the time by the use of this class of machine I am no better off, because I have no time to deliver my tonnage of coke in the balance of time available in the week.

I came, therefore, to the inevitable conclusion that two vehicles were necessary. I realized that, to a certain extent, it was better that way, because then I could use a tipping wagon for the coal deliveries and a platform lorry for the coke and other traffic.

This alternative choice of vehicles is, in fact, desirable. The next thing to do is to decide how to dispose of these two vehicles to advantage, first during the winter, and then during the summer. It seemed that the best way was to put the tipper entirely on to coal throughout the whole of the 32 winter weeks, to dispense with help in loading and to allow an hour for each journey. In that way the driver could comfortably cope with his average winter load of 80 tons per week and could, moreover, at peak-load times, carry as much as 96 tons per week; using the full 48 hours and still without strain.

What the Coke Deliveries Involve.

Then I turned to the problem of delivering the coke. Presuming an average of 40 1-cwt. bags per journey and taking it for granted that coke takes the same amount of handling as coal, then I can use a standard figure, which I have in my notes, of 3/ minutes per bag as being an average needed for loading and unloading to the householder.

For the full load of 40 bags, therefore, I need 140 minutes loading and unloading time. I should assume that the total round journey within the three-mile radius would not, on any particular occasion, be more than five miles aod that the travelling, being house to house, would be accomplished at an average speed of 5 m.p.h. That gives me 60 minutes for travelling and a total time per round journey of 200 minutes.

On that basis, two average round journeys delivering coke could be made in approximately 61. hours, leaving a couple of hours each day to deal with the oddmentsperhaps to deliver a couple of gas stoves or run a load of by-products to the station. That would allow only 11 deliveries of coke during the, week, two deliveries a day from Monday to Friday and one on Saturday morning. However, it seemed likely that two or three, at least, of the iound journeys per week delivering the coke would be shorter than the five miles I have allowed, and that it might be possible to squeeze three into a day, even at the expense of half an hour's overtime or so, thus completing the necessary 12 journeys per week.

Alternatively, of course, the vehicle delivering coal, which has some time to spare, could deal with the by-product traffic, thus easing the load on the second vehicle. The foregoing at any rate was my plan for the organization of this traffic during the winter.

In the summer one vehicle only would be needed to cater for the traffic. At the same time, I still wanted to be able to use the tipper for the coal deliveries and the platform lorry for the other work. I concluded that I should use the tipper for 24 hours of the week to deliver the 50 tons of coal to the gas works, and the other lorry would get through its deliveries of coke-only 200 tons, it should be remembered-in 16 hours, a total of 40 hours. This would leave eight hours' use of the second vehicle-the platform lorryfor the delivery of by-products and miscellaneous traffic.

Now comes the all-important question of cost. During the winter the following will be the standing charges for each lorry:-Tax, 12s. per week; wages, on the basis of Grade II, and assuming that the latest rise of 6s. per week is conceded, will be £4 7s. per week net, to which must be added approximately another 4s. to cover National Health Insurance, National ' Unemployment Insurance, insurance under the Workmen's Compensation Act, and holidays with pay. Then there will be provision for rent, 7s. per week; insurance at 9s. and interest on capital outlay at 5s., producing a total of £6 4s. per week for standing charges.

Next we come to the running costs which, as usual, I give in pence per mile. By the nature of the work, these vehicles will be somewhat heavy in the consumption of fuel and lubricating oil. Taking petrol at Is. I ld. per gallon and assuming 10 m.p.g., that gives me 2.3d.. and oil I will take at 0.15d. For tyres, 1 take it that the work will not be particularly arduous. The tyres on a 2-tonner are usually 32-in. by 6-in, singles, all round, and to-day the cost of a set is £40. If I assume that the mileage covered approximates an average of 11,000 to 12,000 per set the cost per mile will be 0,85d.

The figures for maintenance I propose to take straight from "The Commercial Motor" Tables of Operating Costs -being 1.20d. for maintenance (d) and 0.70d. for maintenance (e). It will be appreciated that maintenance (d) is high because of the low weekly mileage which, as will be shown soon, does not reach an average of 100.

I now come to depreciation and, here again, have to deal with the disadvantage of low weekly mileage. I assume the average first cost of the vehicle to be £350. From that I deduct £40, the cost of the tyres and allow 130 as the residual value, giving me £280 net.

On the basis of a life of 80,000 miles that would give me 0.84d. per mile as the standard figure for depreciation. That assumes, however, an annual mileage of not less than 24,000, but as my mileage is only approximately 5,000, I must follow my usual rule and add 5 per cent, to the standard figure for depreciation for every thousand miles by which the annual mileage falls short of 24,000-that is 95 per cent. Hence the figure of 1.60d., which I take for depreciation-a total running cost of 6.8d. per mile. For the tipper I take 7.0d. per mile. During the winter the tipping lorry will average 60 miles per week, and that at 7d. per mile is £1 15s., so that the total cost will be £7 19s., which we can quite reasonably take to be £8 per week.

When the Platform Lorry Transports Coke.

The platform lorry, when delivering coke, will do a dozen journeys averaging, say, 5 miles each, which is 60 miles, and, perhaps, another 30 miles delivering gas stoves, by-products, and so on, making a total of 90 miles per week. That at 6.8d. per mile gives me a total of £2 us., and adding that to the £6 4s. standing charges I get £8 15s. per week as the total operating cost of the second vehicle. It should be noticed that the difference between the two totals is due to the fact that the platform lorry covers a greater weekly mileage. The total cost of the two vehicles during the 32 weeks of winter is, thus, £536.

Now we have to consider the summer employment. Although one vehicle only will be employed at a time, both will have to be licensed, insured, garaged, and bear the interest cost. The amounts of these items are as follow:licences, £1 4s.; insurance, 18s.; garage rent, 14s.; interest on capital outlay, 10s.. total, £3 6s. I must assume that the driver who would otherwise be idle is found work elsewhere about the gas works, so that although he need not be discharged or suspended, his wages are, nevertheless, not a debit against the transport. Whilst, therefore, all the above items of the standing charges have to be debited against the two vehicles there is only £4 7s. for wages and 4s. for insurances and provision for holidays with pay, both relating to one man, to go to this account. That makes the total .standing charges during each of the 20 weeks of the summer months 17 17s. per week.

Next we have the mileage. Coal involves 25 journeys a week of l miles, making a total of, say, 38 miles per week. Coke necessitates five journeys of 5 miles each, making 25 miles, and on top of that there is still 30 miles per week on account of gas stoves, gas appliances and sundries, making a total of 93 miles. If I charge that at 7d. per mile-the maximum running cost-I get £2 14s. 3d., which I propose to call £2 14s. That added to the £7 17s. standing charges gives me a total operating cost of 110 1 Is. per week, and that for 20 weeks amounts to £211.

Add that to the £536 already agreed for winter months and we get a total expenditure of £747, say £750 per annum.

In the case of a 2-tonner, the average figure I take for establishment costs is 30s. per week. In a rural area, however, it is more likely that this part of his expenditure will fall below the average. It will probably be safe to take the full amount of £100 per annum for the two vehicles. Adding that to the £750 operating cost gives us £850 as the annual expenditure. It would not be unfair for him to expect to make £150 profit in the year, making a round

figure of £1,000 per annum for the contract. S.T.R.


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