Know Your Costs
Page 24
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AT a time when expenses are rising steadily, no operator can afford to be in ignorance of the cost of running his vehicles and conducting his business. On the passenger side of the industry. traffic returns continue to soar, but the advance in costs of operation tends to outstrip the increase in revenue, and in many instances the gap between cost and receipts per bus-mile is narrow. Only the vast mileage operated enables a substantial profit to be made. In haulage, the position is not so rosy. There is no general increase in traffic to offset the rise . in costs, and the haulier who has no precise knowledge 61 actual expenditure -is liable to find that he is workingat a loss. Many small operators ignore altogether the important item of overhead charges, although the prices of office equipment, stationery, printing and postage have risen sharply since the war and now represent a formidable _ part of the total cost of conducting a transport business.
The only way in which an, operator can make sure that he is not omitting any item of expense from his budget, and that his own figures are not far above (or below) the average, is to use "The Commercial Motor" Tables of Operating Costs. A new edition is now in the press and extracts from it are published on pages 700-705 of this issue. Because of the meagre paper quota granted to publishers of trade and technical journals, it is not possible to resume the pre-war practice of presenting a free copy of the full Tables to every reader, but they will shortly be on sale in booklet form. They are completely up to date and, indeed, anticipate certain changes in cost levels.
The operator whose costs are appreciably higher than the average quoted in the Tables should immediately seek the reason. There may well be some leakage, or extravagance arising from inefficient use of men, materials or machines. Where actual figures are substantially lower than those in the Tables, there is again cause for suspicion: in such a case, the operator has probablyoverlooked some item and is temporarily enjoying the comforts of a fool's paradise.
The service provided by the Tables is, of course,' supplemented by. the advice of S.T.R., "The Commercial Motor" costs expert, whose experience will freely be placed at the disposal of any operator who has a problem that he cannot solve for himself. Only "The Commercial Motor" can offer these facilities.