More About Farm Haulage
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IN last week's micle I gave a list of some of the miscellanea which hauliers carry iu rural areas and I
quoted some typical rates. Agriculture presents great opportunities to the haulier; the work is varied and, taking into consideration every branch, it is continuous.
Sugar-beet haulage, which I mentioned last week, is obviously work of a seasonal nature. Nothing in agriculture balances it throughout the remainder of the year. At one time, hauliers were in the habit of keeping vehicles for that work alone, laying them up during the off-season, overhauling them and preparing them for the next. This is still the practice with quite a number of operators who keep extra vehicles for this class of haulage, taking out short-term licences to cover the season.
Many of them, however, use the same type of vehicle duringthe summer for municipal and county council contracts, hauling sand and gravel, tarmac, road-making materials and the like.
It is surprising that despite the popularity of the 5-6-tonner, many small operators in the country use 3-tonners to cater for the requirements of local farmers, and it may be useful at this juncture to consider the 3-tonner, to indicate its cost of operation and show the operator what he must charge to earn a erofit.
Following the usual procedure, I propose first to set out all the basic figures for the operating costs of such a vehicle, taking into consideration, of course, purchase tax, and the recent addition of 9d. per gallon to the
tax on fuel. . . First as regards depreciation. A new vehicle to-day will cost about £575. A set of 32 by 6 tyres will cost £75, which reduces the net cost of the Vehicle to £500. If I assume a residual value after five years of £50 'the net amount on which depreciation ,must be calculated becomes £450, which is £90 per annum-or £1 16s. per week.
We may now set down the weekly fixed charges as follows:-Tax, 12s.; wages, in a Grade II area and making provision for the usual insurances and holidays with pay, £5 8s.; garage rent, 5s.; insurance, I2s.; interest on capital outlay, 7s.; depreciation, £1 16s, and overheads, £1 10s. The total is £10 10s. per week.
I daresay a number of small operators who work in country districts will be inclined to cavil at the figure of il 10s. per week for overheads. They should not. A haulier who has no more than two vehicles will need more than -£1 10s. per week from each to pay his own wages as manager, so that if it be regarded from that angle it will beappreciated that the amount f quote is less and not more than what is likely to be the actual amount. Continuing the Conditions under
Covering Costs
The running costs will •work out something like this:Petrol, assuming its price to be 2s. 91d. a gallon and that the vehicle does 17 m.p.g., wilt cost a little short of 2d. per mile. If I take 2d. for petrol and oil I shall be near enough. For tyres, assuming a life of 24,000 miles per set, the cost per mile will be id. For maintenance, I assume Hd, per mile, a figure based on the knowledge that a good deal of the maintenance on these lorries in rural areas is carried out by the driver or the operator and the cost is less than usual. The total running cost is therefore 4d. per mile. In order to cover his costs alone, therefore, the operator must make £1010s. per week, which is 4s. 9d. per hour plus 4d. per mile.
Actually, of course, it is usual to assume that provision is made for profit, and I propose to add on that account £2 10s. per week to the fixed costs, making a total of £13
per week or 5s. 101d. per hour and 41d. a Mile. That means that the operator must charge 5s. 101d. per hour on the total time taken on any particular job, including A38
travelling time, waiting time, loading and unloading time plus 41d. per mile actually run by rthe vehicle.
There is a small snag here, inasmuch as if there are many journeys which terminate in 'a town where 'Grade I wage rates are paid, then the operator must pay wages on a Grade I rate for each of these journeys, which would add a small fraction more than Id. per hour to the charge. It is up to the operator to keep this in mind when quoting for work of this description.
The letter which started me on this particular line of thought referred to the carriage of poultry. The operator is evidently covering long distances and I am therefore led to assume that poultry is regarded as livestock and is an excluded traffic, one which he may carry beyond the 25-mile radius without a special permit. He may, however, have had to obtain permits for his hack loads which, he tells me,
are meal or feeding stuffs or other farming requisites destined either for the poultry rearer himself, if he be engaged on mixed farming, or for farmers other than his poultry-breeding customers.
He tells me that he frequently covers 1,000 miles per week and as regards one of his journeys he covers 120 miles in a day. 1 have told him that tha.t particular iob should bring in a total revenue calculated as follows: 8 .hrs. at 55. 101d.-£2 78.-plus 120 miles at 41d., which is £2 5s., making £4 12s. in all.
The amount necessary to cover his costs, including provision for establishment charges and overheads will be 8 hrs. at 4s. 9d., which is £1 19s. plus 120 miles at 4c1., which is £2. The total is £3 19s. These two totals are important. They indicate the margin of profit which, it should be noted, is only 13s. per day.
In another case where the work covers 180 miles, the figures on which charges are based are £2 7s. for the 8-hr. day, plus 180 times 41d., which is £3 7s. 6d., Making a total of £5 14s. 6d. His bare costs are 8 hrs. at 4s. 9d., which is £1 19s., plus 180 miles at 4d., which is £3, making £4 19s. in all, so his profit for that day is still only 15s. 6d.
Any haulier engaged on this class of work and knowing his revenue, should set it against these figures if he wishes to know whether, persisting. in his present rates, he will eventually find himself in difficulties or whether he is actually making a profit.
Manure Haulage There is a fair amount of haulage of artificial manure from town to country. Sometimes this traffic comeS as part of a back load from poultry haulage, or in connection with other transport from the countryside to the town. More often, however, the distribution is over short distances: Hauliers are generally asked to quote for 1-6 tons over distances of 1-20 miles. The material is usually in sacks and a fair average for loading and unloading is 15 mins. per ton for each operation. That period applies, of course, where there is no provision for loading from a chute and where no help is given.
These are the usual conditions. Most of the loads offered are within the 3-ton limit so that the figures quoted above as the basis of charges are applicable. A minimum profitable rate must be calculated on the basis of 5s. 101d. per hour plus 41d. per mile, compared with the bare costs of 4s. 9d. per hour and 44:11. per mile.
Taking the first case of a full load on a 3-tormer and a minimum radius of 1 mile, the time needed will be 1 hr. 40 mins., made up of 11 hrs. for loading and unloading and 10 mins. for travelling 2 miles foot and home). The charge for the time should thus be approximately 9s. 9d., to which must be added the 2 miles at 41d. each, which is another 9d., giving 10s. 6d. or 3s. 6d. per ton for the first mile. Each additional mile adds 6 min.s. to the time, which is equivalent to approximately .7d., and 9d. to the mileage cost (2 miles at 4id.), that is Is, 4d. or approximately Sid. per ton. For a 2-mile haul, therefore, the price should he 3s. Hid. or 4s., and for a 3-mile haul 4s. 5d. Over 3 miles, the time per extra mile ,should be. revised, as there is the opportunity of speeding up a little, and for each successive mile it can be taken as 4 mins. instead of 6, thus costing 5d. for time plus 9d. for mileage, or Is. 4d., which is a further 5d. per tun, and so on.
When I referred to the carriage of livestock I had in mind the conveyance of pedigree animals to and fronit agricultural shows. The Royal Show, now closing at Oxford, is the largest and most important of such exhibitions in the world. At a conservative estimate it provides loads of horses and livestock alone for between 400 and 500 journeys.
Special Circumstances Approximate figures which I have, indicate that the entries at the show came to 600 horses, 1,200 head of cattle, 600 sheep, the same number of pigs and a few goats, More than half of them arrived at the show ground by road, On that basis 30 horses were brought in horse boxes, say 150 journeys; 600 catttle, say 270 journeys; and for the sheep and pigs, 60 journeys. The total is 480 journeys. Those who are unacquainted with the special conditions under which this branch of transport operates, may be inclined to criticize the above estimate of loadings, which provides for the averagss as follows;-two horses per box; rather more than two head of cattle per lorry load and about 10 sheep or pigs. In ordinary circumstances, for example, carrying animals to the market or slaughterhouse, these loadings are considerably exceeded.
When carrying animals for show purposes however, the everyday method of loading is not permissible. Half the number of animals is all that can be carried. A considerable proportion of the capacity in bulk as well as in weight is occupied by fodder, show yard accessories and even groomsmen and herdsmen.
Those who are accustomed only to normal livestock haulage will appreciate that when the vehicles arrive to pick up the load, half a dozen, and sometimes more, store cattle are driven pell-mell up the ramp into the lorry, the ramp lifted and fastened and the lorry driven off in five or six minutes. Even less time and ceremony are necessary to unload the same number of beasts. Sheep and pigs are treated similarly at the markets.
Care of Animals .
So far as small operators are concerned the conditions at the show yard are different. The animals are carefully tethered, stand knee-deep in straw, and every detail of woodwork in the van is carefully padded. To unload, the ramp is first let down, then all droppings are swept from the rear of the van so as to eliminate slipperiness. A thick carpet of straw is laid over the ramp; hinge-bolts or similar bolts are carefully wrapped. The herdsman then looks everything over, to make sure, presumably, that there is nothing over which his charge may stumble. He next carefully untethers -one animal, coaxes and pats it until it sees fit to turn, and then leads it slowly and carefully down the ramp to the ground and away to its allotted stall in the show ground. Only then is the next animal led forth, The practical aspects of this matter and the methods of charging are clearly indicated in some correspondence I had a short while ago with an operator who• wrote saying that he would be obliged if I would give him some rates for the carriage of livestock, mostly pedigree cattle and racehorses.
He told me that he was using a vehicle with a container which originally cost £1,500. It was an oil-engined vehicle with a capacity of six cows and three horses. The container was fitted with removable partitions for use when carrying horses. For show work, however, he usually carried only one horse or three cattle per load. The journeys varied considerably, the distances being from 15 to 200 miles and even more. He gave me three typical examples.
Number 1, a round journey of 48 miles. which occupied a total time of 5i hours, part of which was spent with the vehicle standing by. Number 2, a round journey of 92 Miles occupying 8 hours. In this case, he states, less time was spent standing by. Number 3, a round journey of 336 miles, occupying 26 hours and in this ease, of course, the driver • had to be paid 10s. 6d. subsistence allowance for, one night away from home.
I worked out his costs in the ordinary way. The vehicle costing £1,500 in the first place had tyres valued at £120 reducing the net figure to £1,380. I assume a residual value of £180 leaving £1,200 as the amount on which depreciation should be calculated. Taking a life of six years, that is equivalent to £200 per annum or £4 per week.
His fixed weekly costs worked out as follows :-Tax, 14s.; wages, £6; garage rent, 10s.; insurance. £1; and interest, 18s.; depreciation, £4; overheads or establishment costs, £3 8s. Total, £16 Ns. His running costs per mile I assess as follows :-Fuel oil, 1.7d.; lubricants, 0.2d.; tyres, 1.2d.; maintenance, 2d. Total 5.1d, To the foregoing figures, which represent bare cost onlyappropriate amounts must be added for profit. I assess this at Is. 6d. per hour and 0.8d. per mile, so that his charge should be based on 9s. per hour, plus 6d. per mile.'
Let us now apply these figures to the three examples quoted. The first journey occupied 5i hrs. and at 9s, per hour the charge would be £2 9s. 6d. For 48 miles at 6d. per mile, El 4s. must be added, giving a total of £3 13s. tat For the second journey there are 8 hrs. to be charged at 9s,, which is £3 I2s., and 92 miles at 6d. which irs £2 6s.,making a total of £5 18s. For the third journey there are 26 hrs. at 9s., which is £11 14s., plus 336 miles at 6d., which is a 8s., plus the subsistence allowance, totalling £20 12s. 6d.
Mileage charge
He wrote me again saying that his customer wanted him to quote a charge per mile. Now that is extremely In the first place he was not explicit in his letter. He did not tell .me whether he wanted me to quote a flat rate per mile to be generally applicable to all the journeys for this particular customer whatever the mileage, or whether he just wanted to be able to quote per mile for the job.
I assumed the latter in the first place, and wrote telling him that if a customer wanted him to give a rate per mile in that way,•-he should, first of all, calculate the amount he would expect for the job according to the method already described and then divide the figure by the mileage. I suggested that he took as an example the first of the three journeys described above, in connection with which we had calculated that the charge should be £3 13s. 6d. That is exactly 882d. for 48 miles and if I divide by 48 we get a figure of approximately Is. 6did. per mile as the quotation he should make.
Then it occurred to me that the customer might expect him to give him a quotation, not for the distance run by . the vehicle, but per lead mite. In that case he would. have to divide the £3 13s. 6d, by 24, which would give him in round figures, 3s. ld. per mile as the charge.
Losing on Short Leads
As I have frequently said • in these article, it is not practicable to quote a flat rate per mile for this sort of work over varying distances. The rate per mile for a short lead must inevitably be much greater than the rate per mile for a long lead, and if the operator, in an attempt to please his customer, quotes an average figure, he may subsequently find that the majority of journeys is over the shorter lead.
In this case I suggested that my correspondent should tell the customer that it would be impossible to quote a flat rate per, mile, first owing fo the difficulty just described, and second because of the extensive variation in waiting time. I recommended him to quote Is. Id. per mile plus 9s. per hour for waiting time.
Another point raised by this correspondent is what to charge in a case where the vehicle takes a load to an agricultural show which is open for two or three days and must .perforce wait at the show, until it closes, and then bring back the animals, In such a cast I think the operator should charge 9s. per hour for eight hours for each day the vehicle is away plus, of course, 10s, 6d, per night subsistence allowance for the driver.