Problems of the
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HAULIER and CARRIER
The Items of Operating Cost Set Out in Complete Detail and Numbered as a Preliminary to Accurate Recording
BEFORE giving examples of operating costs, there are two more matters with which I must deal. It is necessary to deal with the details of each of the 10 principal items of operating cost already described, allocating to each an appropriate number of columns in the analysis sheet and numbering the columns accord
ingly, to make sure that nothing is overlooked. , It is also necessary to consider how to arrive at some of the essential information, such as mileage covered, petrol used, oil consumed and so on. Much of these data come from the driver's daily report. Many hauliers have hitherto neglected this essential preliminary to accurate costing. To-day they cannot avoid it.
How to Collate the Data. .
Every driver, with certain exceptions which I need not take into consideration, must now make a record of his daily work, in order to comply with the regulations issued under the Road and Rail Traffic Act, 1933. It is a simple matter to expand that record sufficiently to enable the information which it affords to include the necessary data to which I have referred.
I will first enumerate the columns of the analysis sheet. In doing so I am' going into greater detail than
is, perhaps, necessary for every haulier or publicservice-vehicle operator, but I do so in preference to the contrary procedure, open to me, of dealing only with major items and leaving details to the imagination. It is easier for a man to omit some of the items which I include, but which are unnecessary in the individual case, than for him to add supplementary columns which I have omitted. The figures given below relate to columns in the analysis sheet.
(1) Date. (2) Briefest possible. description of work. This may be, for example, gravel cartage, bricks, furniture removing; parcels carrying, load of machinery Or some such similar item, full details of which wig, of course, be available elsewhere as a check. (3) Mileage. This, as I shall indicate later, is to be ascertained from the driver's daily report.. (4) Fuel. "This may be petrol, oil or coal. The figure to be insetted in the colunin is the quantity of fuel igsued to the vehicle on that particular day. There iS no need for a dip-stick measurement or anything of that kind, as the information we really require is the total fuel used over a period. (5) Fuel bonus. This is to provide for the entry of any bonus paid to the driver in connection -with any fuelsaving bonus scheme which may be in force : this is one of the columns which, in the majority of cases, will be unnecessary.
Recording Tyre Costs.
(6) Engine oil. (7) Tyres : mileage charge. (8) Tyres : cost of new covers and tubes. (9) Tyres : repairs labour. (10) Tyres : repairs ; materials. (11) Tyres : scrap credits.
In this series of costs relating to tyre costs, I have followed •the procedure which I recommended earlier, viz., of providing for a record of estimated cost, as well as for actual expenditure. The estimate figure will be based on a predetermined allowance per mile for tyres for the 'particular vehicle concerned, and the amount inserted in the column will be the figure per mile multiplied by the number of miles covered during the day.
(12) Maintenance : cleaning materials. (13) Main tenance : labour for cleaning. (In some instances the labour will be that of the driver, in which case, for the sake of simplicity, it will be better to enter " nil " in this column.) (14) Maintenance : water.
This may or may not be a small item, but if there be a fairly large fleet, the water account is apt to be considerable. If all the water used on the premises be not employed for washing the vehicle, some proportionate allowance should be made accordingly.
(15) Maintenance: engine and chassis: labour. (1(3) Maintenance: engine and chassis : materials. (17) Maintenance : body : labour.. (18) Maintenance : body : materials. (19) Maintenance : lighting and ,electrical: labour. (20) Maintenance : lighting and electrical : materials.
In these six columns of maintenance, some discretion is necessary in deciding whether all of,theat are needed or not. Some operators will, no doubt, take the view
that it is quite sufficient to have two columns, one for materials and one for labour. They will hold that it is unnecessary for them to know in detail whether the repair mans time was spent in repairing the body, in attending to the engine, or, perhaps, in fitting a new bulb to a lamp. I am certainly not going to suggest here that it is absolutely necessary to record these matters in such detail, because I am not of that opinion. The suggestion is there for those who wish for fine detail.
Precise Maintenance Costs.
In the case of those who agree and who wish to know what proportion of their maintenance costs go to chassis and body, the following supplementary notes are important :—If the repairs department be so large that a foreman is employed, then his wages, when not chargeable directly to chassis or body overhauls, running repairs, or to lighting, should be allocated thereto in the proportion to the labour charges involved. In the case where some of the expenditure is due to accident and the amount is recovered from an insurance company, the ac
tual sum recovered should be credited to the chassis or body, as the case may be.
Further, proceeds from the sale of scrap material may, where it is of sufficient importance, be credited under " materials." If, as in all probability will be the case, the scrap material be collected and sold periodically, the -amount received can reasonably be distributed as credit to the different vehicles, in proportion, approximately, to the actual expenditure on materials.
How to Estimate Depreciation.
(21) Depreciation. This, as in the case of the column for tyres, is an estimated amount per mile of use, and the sum entered daily in thu column should be that agreed amount per mile, multiplied by the number of miles covered during the day.
(22) Road Fund licence. (23) Certificate of fitness. (24) Road service licence. (25) Public-service-vehicle licence. (26) Driver's wages. (27) National health and unemployment insurance. (28) Employers' liability insurance. (29) Conductor's or statutory attendant's wages. (30) National health and unemployment insurance. (31) Employers' liability insurance. (32) Garage rent.
Rent should be a proportion of the total expenditure on the building in which the vehicles are housed. How that expense is calculated and totalled depends upon circumstances. If the building be the operator's own property, he should charge its cost proportionately to the amount which he might reasonably expect to obtain as rent. In assessing that rent he should take into consideration the first cost of the land and buildings, and the annual interest thereon, making proper provision for repairs and maintenance work carried out on the properties.
(33) Insurance of vehicle. (34) Interest on first cost. (35) Total cost. (36) Total cost per mile. (37) Mileage per gallon (or cwt.) : fuel. (38) Mileage per gallon: lubricating oil. S.T.R.