Here we are at the end of yet another year and the time when the MT cost tables appear.
I look forward to comparing my own costs to yours and the MT tables are not far adrift of reality.
Except for one thing.
I question the wisdom of advising your readers of going for a 5% profit margin over and above the costs involved.
I understand the thinking, it does after all reflect the performance of the industry and at the moment 5% is doing well.
But these operators more than probably started with a much larger margin which after a trading period, gets whittled down to 5% or less.
Our industry, unlike say, manufacturing , is exposed to innumerable reasons why a planned job does not go as we had hoped and results in the loss of profit. At a projected profit per working day of £19.73 based on a 44-tonne tractor and curtainsided trailer doing 80,000 miles per annum (taken from your cost tables) , it doesn’t take very much to rub that out.
I note the RHA cost tables takes the same approach and indicates a margin of 5%. All very well if you have taken into account every single cost that is likely or going to be incurred. I doubt that is the case.
My question is really should operators be advised to aim higher in the hope of ending up with the industry norm of a margin?
Robert Wilcox, MD, Massey Wilcox Transport
