Faults costs mar than you think
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F1-111.1 having a chat with an n,n-account operator we A onto the subject of Isting repairs. Repair costs e one of the indeterminate pares that at the beginning each financial year aerators can only take a ab at, using experience and cords as a guide.
It is not often that we are on a right side of our budgeted sts at the end of our financial ar. However, there are rtain pitfalls that we came up th which I think will interest U.
Perhaps you will be aware of )st of them. I must confess 3t I was, but I had not given fficient thought to what these falls mean and so I have en under-estimating my dget figure. Let's look at the subject logically. What happens first? Being a one-man band, my earning capacity ceases completely when I break down. With my friend's fleet of 10 vehicles he loses the potential of 10 per cent of his earning capacity..
Seldom if ever are breakdowns costed by the hour. But that is just what should happen because when the time comes for us to decide upon a replacement vehicle we should be in a position to know precisely what the one we are replacing has cost to operate. How else can we make a calculated judgment?
Take, for instance, a simple puncture. Let's suppose we are running more than 100 miles and at £3 per ton; we would be earning when carrying 20 tons, £60 or 60p per mile gross.
If we reckon to average say 25 miles in every hour — taking account of loading and tipping — our hourly earning capacity is £15. As we lost an hour, we should add £15 to the cost of the puncture.
Use this system when faced with a breakdown by adding £15 to the cost of the job for every hour lost and we very soon recognise how easily we throw away profitability by not paying attention to downtime as a cost.
It does not finish there. When we are immobile through a fault which the man on the spot cannot rectify, we are faced with a phone call. A call up to 56km costs 3p for every 30 seconds during the peak period if you can dial it yourself. If you need to phone a number over 56km the same period will cost you 9p. If the operator has to get your call fa you, the under-56km call will cost you 18p for each three minutes. The over-56km call 54p costs for each three minutes.
Nor is it unusual for a breakdown call to last 10
mutes, so the longer distance II in that case would cost you ?.08p. And we all know too all that a single call is rare. The repair agent may say: 3ive me your number, we'll lg you back,'" and that cost )es on your repair bill, too. Next we have our idle .iver's time while he kicks his ?.els waiting for someone to out to him. With luck it is )t a tow-in job. If you're on a .otorway, roadside repairs are Dw illegal, so you'll get a wing charge anyway whether r not the job is serious.
Now comes the crunch. Our repair agent has got out to us and needs some spare parts. If we've chosen our steed wisely, procuring these will be no problem.
If on the other hand we searched out the cheapest vehicle with the highest discount, it's ten to one we'll not get the bits quickly, and then the old cash register really gets going.
First come many long phone calls, trying to locate parts. Then the cost of getting transport out to pick them up. All the time you are clocking up expenses on one hand while on the other your hourly earning capacity is draining away.
With luck a breakdown is repaired within a day. With less luck, maybe ten days.
Our costing should keep feeding into the books the ongoing charges so that we get a true picture of what the job meant in direct costs, indirect costs and loss of earnings.
When the job goes over 24 hours we must not forget subsistence money, travelling and meal expenses in getting the man home again without his truck. And we have to get him back again to pick up the lorry when it's repaired.
I have to hire another vehicl! for I don't expect my customen to suffer the inconvenience of my breakdown.
Perhaps you think that's the end of it. How wrong you are. Once you have fixed up anothe vehicle the load must be transferred. If it comprises small and easy-to-handle packages you might manage without any cost except your time. But if they weigh more than 3cwt you'll be looking for some lifting gear which you'll find with difficulty and which will be very expensive.
Finally, when your beast is once more ready for action yoi. must somehow get your ropes and sheets, chains and load-binders back on board an that will entail an empty run back to base.
If this saga happened once in a year it would be too often. More than once would, for me be a disaster.
Check how accurately you determined the cost of some o your own breakdowns. Then search your conscience to see your new decisions on which vehicle to buy were made for the right reasons.