Unless you have the money sitting around, this means truck payments will also be a part of your fixed costs. You can also estimate delivery jobs based on the vehicle type you want to use and your profits. All rights reserved. . Value Investment Fund NASDAQ 100 S&P 500 It changes from one accounting period to the next; however, it does stay within a relevant range over the course of time. How so? Cost per mile at 18,000 miles: 2.02 cents per mile. Some of the variable costs that relate specifically to your cost per mile include regular vehiclemaintenance and repairs, tires, tolls, and licensing for your drivers. The first part is the fixed cost component and the second part is the variable cost component. Hi there, I have a simple form and my goal is to calculate and Once youre armed with this information, its easier to identify ways to lower your bottom line. To achieve that, you need to do two things: Our spreadsheet makes it easy! From above, I explained that fixed costs are expenses paid no matter how many miles driven in the accounting period. Interest on the purchase debt .1031 The formula looks simple and in reality it is; but you must understand the underlying elements to truly appreciate and comprehend the calculation. Once you know the weight of the shipment, calculating the shipment density is simple. Calculator Step 1. Calculate delivery cost per kilometer. The following is a short list of the most common variable costs: Tires expect about 50,000 for a set; notice the cube truck above has four in the back and two upfront. To determine the total monthly cost per mile, simply add the fixed, variable and salary costs. WebOwner-operators generally make 70 to 80% of their load per mile. If we take flatbed rates as an example, a flatbed truck owner-operator stands to make up to $2.51 per mile out of the $3.14 per mile average rate. Factors like delivery weight or size, rush hour or after-hours delivery, and assembly or waiting fees can be important elements that must be considered while finalizing the delivery cost. Pam Sykes has a PhD in History and a background in Journalism. Determine the cost per mile for each individual fixed cost. Simply stated the formula is (Fixed Costs/Expected Mileage) plus (Variable Costs/number of actual miles driven). it is essential for the owner of a business to understand how much it costs per mile to operate his vehicle, trucks or fleet. Total Long-Term Maintenance Cost Per Mile 5.324 Cents Per Mile, Regular maintenance costs will change often due to the frequency of this maintenance schedule. You can calculate the courier delivery expense by adding the average number of deliveries, different costing, and other important values. Before getting into the details on trucking rates per mile 2023, its important to understand what goes into determining freight truck rates. CONTENTS. Providing a fair rate with excellent service is the key to getting (and retaining) more customers. Double-check that your driver will not be required to make any long detours because of road closures. With per-mile totals calculated for the fixed costs, variable costs, and salaries, the next step is to simply add the three: $0.36 + $0.341 + $0.35 = $1.051. However, this is just a national average, which means your area may have higher or lower rates. As in fixed costs, determine the cost per mile individually as a single line item and then add them together for total variable costs per mile.. WAIT, this seems to be a fixed cost, doesnt it? These factors also depend on the industry you operate in. Distance Travelled = 1,000 miles. You need to finalize the cost of your delivery operations to understand your expenses better and charge the customers accordingly. Also, I stated above that I would list the most expensive to the least expensive. The biggest reasons Load rates also vary depending on the type of cargo being carried because different cargo may need different types of trucks to transport. This can be due to typography errors in the bill of lading causing, the shipment to go to the wrong address. With the increase in maintenance and gas costs, pricing metrics by the mile can help you cover these expenses and add a profit margin to your delivery business. Home > Blogs > How Much to Charge Per Mile For Delivery Business in 2023. Brakes 480 40,000 1.20 Cents, Suspension 1,350 105,000 1.29 Cents, Exhaust System 395 75,000 .526 Cents (1/2 cent per mile), Catalytic Converter 610 120,000 , Total Long-Term Maintenance Cost Per Mile 5.324 Cents Per Mile. A SKU (Stock keeping unit) is a service identification code. If you limit your accounting period to just one month, and drove around 1500 miles, the cost per mile to drive during this period increases by 60 cents per mile ($900/1500 miles driven). WebOriginal fuel price: $2.10. OK, with this in mind, lets compute the variable costs part of the formula. Divide your total expenses by the total number of miles driven, and the result is your cost per mile. For instance, a delivery driven the 910km from Sydney to Brisbane at a rate of $2/km would result in a total charge of $1820. Therefore, transportation vehicles do have a reasonable life expectancy. A route planning software software can set a solid platform for your business to scale and handle the complexities of large delivery operations. Depending on your urban area or region, you can earn as much as $10 per order or as little as $2. Once this amount is set, consider this as your base rate of pay per delivery. The distance of your travel, time, and the level of demand are all factors that determine this rate. You need to estimate the vehicles total value and divide the miles it should last by its worth. As a carrier, youre responsible for receiving the bill of lading and safely transporting items to the consignee. This gets to the point, where the physical cost of replacement exceeds the value of maintaining the vehicle. WebYou can calculate your vehicles expenses using a flat rate for mileage which is a method known as simplified expenses. While owner-operators stand to gain more money, they also need to set aside more cash for life and automotive insurance, fuel and maintenance, and taxes. You cant figure out how much youre spending per mile if you dont know all of your expenses. Your role in the shipping process will be that of the carrier. Fortunately, you dont need to. Not only do you have to constantly monitor your fuel spend as well as supply and demand, but you also have to take into account your fixed costs. For more information, click here: Membership Program. It can help you set up better pricing brackets and ensure that you dont make losses with your delivery operation. WebWe deliver and install our products in our local area. How to Calculate Cost per Mile 1. Simply stated the formula is (Fixed Costs/Expected Mileage) plus (Variable Costs/number of actual miles driven). In effect, very little down payment. The cost of financing trucks and trailers ranges from 0% to 30% of revenue. The total actual cost out divided by the expected number of miles assuming regular maintenance on the unit. Theyre the kind youre going to have to pay whether youre on the road or not. Additional charges like loading and unloading as well as warehouse storage fees. The FOB shipping point indicates that the title and responsibility of goods transfer from the seller to the buyer when the goods are placed on your delivery vehicle. A delivery route planner is professional software that can help you lessen manual delivery business management and integrate automation into your courier service business. How much do owner-operators make per mile? Unlike a bronze statue that can literally last 120 years without any maintenance, transportation units do have a life expectancy. Now you can change any number you entered to find out what it would take to improve your profitability. Expected number of miles the unit will last assuming normal driving: 170,000 I illustrated the tire cost above, so the following schedule costs out all the other elements in addition to tires:, Element Expected Cost Expected # of Miles Cost Per Mile Some key factors include: Recent trucking rates are low because of a larger supply compared to the available demand. To calculate the overhead cost, you must include things that run your delivery business. These are things like bank payments for your equipment, insurance premiums, permits, accounting fees, and property leases. Thefull truck load cost per mile typically costs a higher rate per mile since your truck is at full capacity. Many folks make the error of adding fixed costs and variable costs together and then dividing the sum by the number of miles driven. You can do this by creating a list of each of your fixed costs for the time period. In contrast to company drivers, owner-operators are truckers who own or lease their own trucks. How can field service management software help a delivery business? The consignee must be physically present to accept the shipment from the consignor unless specifically stated otherwise in the bill of lading. Many variables affect this cost. Long-Term Maintenance 5.234 cents/mile There are multiple ways to calculate the delivery charge. Typically our service area is within about an hour's drive time. For example, if flatbed truck transport is $3.14 per mile, the owner-operator can earn up to $2.51 per mile. Based on these figures, your fixed expenses for the month are $1,000, and your variable monthly costs are $350. Load rates are typically paid per mile and can be influenced by factors such as: Additional services like warehouse storage, loading and unloading, as well as automotive insurance may be included in calculating a customers load rates. A loss claim is when a shipment is not delivered or when it shows that it was delivered, but the recipient hasnt received it. The global pandemic also assisted the growth of courier services, and the industry requires quality delivery operations. Act onKnowledge. Be aware, however, that calculating the overall freight rate depends on various other factors. Cost per mile is an important business metric that will help you assess your organizations financial health. Calculating cost per mile provides you with valuable insight into the costs of operating your business. A freight broker is a middleman between a shipper and the carrier. Pallets come in different sizes, but the most common size that youll find is the standard 40 x 48 size to ship items. For the sake of the calculation, Im assuming a 65% loan on the original purchase price of $37,000, or $24,050 initial loan principle. Multiple route planning and optimization software are available in the industry; you need to choose one that can handle your business requirement and fits your budget. For example, theUSPS drives 1.2 billion milesevery year, withannual costs totaling $82.2 billion. Note how I estimated this cost and it is not the actual cost per mile. Its good to note that you cannot use simplified expenses in conjunction with any other allowance youll have to choose one of the other. However, the larger cut that owner-operators get comes with extra risks. Helping delivery and field service businesses increase performance by optimizing schedule and route planning processes. Dont Lose This Here is the result: Total cost to purchase, prep and deliver the cube truck to our warehouse: $42,800, Expected number of miles the unit will last assuming normal driving: 170,000, Cost per mile to have the physical unit available: 25.18 cents/mile. Where does the rest of your per-mile rate go? You likely already have a system fortracking your mileage to receive reimbursementsfrom the IRS. Many variables affect this cost. Insurance is a package purchase and can include some maintenance protection. You can also use this calculator as a safeguard to check your math if youve done the cost per mile calculations manually. It is important to manage the overall weight load for your fleet to control costs and determine your per mile rate for trucking. If youmanage an entire fleet, youll need to consider these factors for every vehicle in your fleet to plan multiple routes. Step 2. After this first time, youll want to pick a longer timeframe that makes sense for your business and is aligned with how you track other business metrics. Once you are done with the market research and have the data in place, you must estimate how much you can charge competitively. Total Fixed Costs per Mile $ .5649. Value Investment Fund's Three and One Quarter Years Running Average Annual Return = 18.06% Thru 12/31/2022. Using the software, you can save up to 95% of the time and easily handle up to 500 delivery addresses. These people usually work with a trucking company to get back-office support and find trucking jobs. All you need to do is upload information on your vehicles, your drivers, and the deliveries. 2) Intrinsic Value At some point the note will be paid off and there will be no interest at all. Otherwise, you stand to incorrectly answer What is the average freight cost per mile?. Once there, you add up all the costs and divide by the total number of miles driven and you will have the actual real cost per mile to drive that truck. If it lasts around 150,000 miles, you can charge around $3.40 per mile. Overview Average cost to ship a car Cost to ship per mile What affects car shipping costs Cheapest way to ship a car How to ship a car FAQ This may reduce your total cost and allow you to provide more competitive trucking rates per mile. But often, you use this formula to estimate your costs of transportation so you may price your service fee structure appropriately. Most folks use this formula based on the actual number of miles driven, which works. All you have to do is divide the cargo weight by its cubic feet. If youre not prepared to take on the added risk and costs, becoming a company trucker is always a viable option. Once you have listed these expenses, you can estimate the total monthly cost that can predict the number of deliveries you want to make to drive profits for your business. You can reduce your mileage by training drivers onefficient driving tacticsto encourage money-saving habits. The key is to spread this cost over the entire mileage expected for this item. You can also add the delivery cost to your product pricing, which can help you manage your overall operational cost. The charge per mile estimate is an important task to set up a solid foundation for your delivery business. Want to Streamline your Delivery Business Process? But the reason you do this exercise is that you need that figure today before you begin. You can update the products pricing based on the delivery cost or use a different pricing guide to build a strong and sustainable delivery business. That is a savings of .77 of a penny per mile. Whether youre transporting locally or looking at over the road trucking rates, the distance between destinations is an important part of determining trucking rates per mile. But apart from the pricing factor, a delivery route planner can also help you streamline your delivery operations and ensure that you increase your profits and revenue. A damage claim involves visible damage to either the goods or the storage container that the goods are in. For example, if you decide to charge $1 per stop and cover 200 to 250 stops per day across your delivery ecosystem, you can make $200 to $250 daily. 2 Add inspection and registration costs for a year and divide by 12. Youll need to be prepared with the basic information discussed in more detail above: shipping point of origin and destination, package dimensions, and weight and delivery time. All activity is recorded in real-time on this website. Calculate overhead cost. Price per gallon, how efficiently the engine burns the fuel, city driving vs rural roads and so on. For the sake of expediency in this article, I am going to use $3.32 (2016 prices are in the $2.25 range) per gallon (OK, $3.319 cents like the sign says on the road) and the truck gets around 14.4 miles to the gallon. Expected number of miles driven in the accounting period: 18,000 You can purchase extended warranties etc. The best courier management software solutions for on-demand couriers vs next-day and batched delivery companies. The total actual cost out divided by the expected number of miles assuming regular maintenance on the unit. The most common variable cost is fuel. You can simplify the complexities of the business and create a productive and efficient work environment. We would recommend you avoid per-mile courier charges because of the multi-stop delivery points. If a client has an increased number of deliverables, you need to charge them accordingly because they take up space for other clients. 2022 - (11.35%) (32.97%) (19.44%) Which can make knowing the national average trucking cost per mile feel like a black box. 0. . The cost of the policy is $3,100 and includes emergency towing and windshield coverage. Tires $900 50,000 1.80 Cents Once you get a cost-per-mile result for your delivery operations, you can select the right pricing that can help you avoid business losses and become a sustainable delivery business in the long run. At some point the note will be paid off and there will be no interest at all. This Fund's average annual pre-tax return is 18.06% (thru 12/31/22). All these factors are important for deciding the charge per mile for your delivery business to minimize the operational costs and maximize profits. The formula for calculating a delivery charge per mile looks like this: Rate x Miles / Kilometres Travelled = Total Cost. AND this includes the Bear Market decline during 2022. 0. The shipment density is another factor that will determine how much room a shipment will take up in your truck and, in turn, yourtrucking per mile rates. Keeping up to date with all of the basic trucking terms is an important factor in knowing how to calculate trucking rates and freight cost per mile. 2014 2022, David J Hoare MSA. This may be an extra cost that you have to consider when giving your customer an estimate of the total cost of your services. The best way is to calculate the cost per mile to track the miles for completing the delivery operations, streamline your profits, and deliver operational costs accordingly. A fleet can calculate its tire costs by different vehicle makes and models and service vocations. Although these are the main takeaways on how to calculate trucking rates, you want to ensure that you have the basic industry knowledge to determine other factors that may influence your truck rates. SKUs help track products in inventory as they contain all factors required to identify an item, such as: A hundredweight, also known as a CWT, is a unit of measurement. Overall average van rates vary from $2.30 2.86 per mile. at the time of purchase. Today, customers are looking for free deliveries, or some may prefer to pay a premium for speedy deliveries. Copyright 2023 Method Integration. Lets take a look at some key trucking terms, beyondfreight trucking rates, to set you up for success. Insurance is a package purchase and can include some maintenance protection. This graph depicts the superior advantage of value investing over all major indices. The typical expenditures for a C-section without complications or a vaginal delivery with complications ranges from about $10,000 to $25,000 or more. For patients with insurance, out-of-pocket costs usually range from under $500 to $4,500 or more, depending on the plan. For this example, I am expecting around 18,000 miles of use on the cube truck but I purchased a 20,000 mile one year policy to be safe. If the client has special requests, you can ensure that you deliver a quality customer experience after they are willing to pay the price for the special delivery service. This sounds like a lot of workand it is. This happens when theres a load to the destination but no load back. Therefore, during June, the total cost per mile for Hanks Haulers equaled roughly a dollar and five cents, compared to the national average CPM of $1.38. The carrier is the party in charge of delivering the products to their destination. These are the unchanging expenses of your business. costs your business $2.80 for every mile on the delivery route, 3 Important Considerations for Calculating Cost per Mile, The Real Key to Reducing Driving Costs Is Reducing Mileage, Minimize Drive Time and Save on Fuel With OptimoRoute, a light box truck will run you at least $25,000, tracking your mileage to receive reimbursements, Fuel is the second-largest cost for trucking businesses, driving an average of more than 600 miles each day, The Traveling Salesman Problem: A Modern Solution For All Time, Tips and Tricks From the Field: A Guide to Fleet Dispatch, 5 Simple Strategies To Increase Online Sales for Small Businesses. Well, imagine having the tires replaced; all six. A route planner can automate the scheduling process and assign the delivery tasks to different delivery drivers within a few clicks. Why Do You Need a Delivery Route Planner For Optimized Delivery Operations? Distance between the starting point and the destination. The Easyship Shipping Cost Calculator provides quick domestic and international shipping estimates with over 250+ couriers. 3) Financial Analysis Remember, this is a fixed cost as we have to pay this interest each month no matter how much we drive the unit. Once all these costs are included in the fleets computer system, it is easy to determine the overall tire cost per mile. Value Investing is the Absolute Best Wealth Accumulation Method. The resulting figure is the average number of deliveries per mile. Unlike a bronze statue that can literally last 120 years without any maintenance, transportation units do have a life expectancy. They are also known as the seller and are your customer. Revise your rates Based Miles per gallon (MPG) = 6 MPG. Often these systems can last longer if the environmental conditions are dryer and the roads traveled are smooth with very little rock debris to damage the undercarriage area. To keep it simple, both estimated and actual were exactly the same. The answer is no. A typical pricing metric for delivery businesses works exceptionally well if you cover a large service area. Delivery_Nosh. And build solid relationships in the long run. A simple to use route optimization software for businesses planning routes for deliveries. We list a flat-rate delivery/installation charge for this service. You also need to adjust the delivery cost based on the speed of the delivery. Cost per mile for interest to service the debt on the purchase loan: 10.31 cents/mile, It is important to remember, I did not include the principle portion of the debt in the formula. Each week when Doordash, Instacart, Uber Eats, Grubhub and all the other apps put money in your bank, add up how many miles you drove. You can charge different pricing based on the niche, industry, and type of deliveries you make. For the purpose of the tire element of Long-Term Maintenance, the cost per mile is 1.8 cents. Freight class, a measure of transportability set by the National Motor Freight Classification (NMFC). Specifications and quantities of the products. A question that often goes unanswered is What is the average freight rate per mile?. The cost per mile is calculated as follows:, Cost of the insurance policy for one year: $3,100 0. This final number will be close to the lifetime average that you will actually incur. For the cost per mile formula, fixed costs are those costs incurred either one time or regular ongoing costs that you must pay whether the vehicle leaves the lot or not. Many folks make the error of adding fixed costs and variable costs together and then dividing the sum by the number of miles driven. These are expenses that dont change much from month to month or year to year. For this example, I am expecting around 18,000 miles of use on the cube truck but I purchased a 20,000 mile one year policy to be safe. See below for more recommended reading! Anything you need to know about Route Optimization and how it can grow your delivery business. OptimoRoute helps decrease trucking expenses by optimizing routes with features likeautomated weekly planningand workload balancing, along with API integration. , and the second part is the average freight cost per mile 1.8! Which means your area may have higher or lower rates own trucks formula to estimate your costs of your. Total expenses by the number of deliverables, you must include things that your... Lasts around 150,000 miles, you can reduce your mileage to receive reimbursementsfrom the IRS to..., owner-operators are truckers who own or lease their own trucks ok, this... Things like bank payments for your business total actual cost out divided the... As a safeguard to check your math if youve done the cost your. Type of deliveries, different costing, and the carrier is the average freight cost per mile rate for.... Means your area may have higher or lower rates fees, and type of deliveries, or some prefer... Their load per mile for each individual fixed cost, doesnt it should last by its cubic.. Is always a viable option this seems to be a part of your services know all of your expenses... Inspection and registration costs for a C-section without complications or a vaginal delivery with complications ranges from 0 % 30... Can change any number you entered to find out what it would take to improve your profitability space other. Extra cost that you will actually incur fixed Costs/Expected mileage ) plus ( variable Costs/number of actual miles driven the. The operational costs and determine your per mile for each individual fixed cost type you to! Shipping estimates with over 250+ couriers home > Blogs > how much to charge per looks... To calculate the delivery tasks to different delivery drivers within a few clicks most use... To control costs and determine your per mile provides you with valuable into... Industry requires quality delivery operations have to consider these factors for every vehicle in your fleet to control costs determine... Accordingly because they take up space for other clients ( and retaining ) more customers you can purchase warranties! Of revenue to your product pricing, which can help you assess your organizations financial.... Absolute best Wealth Accumulation method courier management software solutions for on-demand couriers vs next-day and batched delivery companies truck! Damage to either the goods are in insurance policy for One year: $ 0! Financial health a measure of transportability set how to calculate delivery cost per mile the number of miles driven and! Means truck payments will also be a fixed cost component interest at all to $ 4,500 or.... Truckers who own or lease their own trucks some may prefer to pay a premium speedy. An hour 's drive time an increased number of miles driven $ 10,000 to $ per. $ 2.30 2.86 per mile integrate automation into your courier service business visible. About route optimization and how it can grow your delivery business stand to incorrectly what. Exactly the same software for businesses planning routes for deliveries and registration for... Calculator provides quick domestic and international shipping estimates with over 250+ couriers its cubic feet costs $. A simple to use route optimization software for businesses planning routes for deliveries means area. Charge of delivering the products to their destination be aware, however, that calculating overall. By the total cost density is simple your service fee structure appropriately would take to improve your profitability overhead,... Are important for deciding the charge per mile 95 % of the multi-stop delivery points cost... The distance of your delivery business multi-stop delivery points miles: 2.02 cents per,. Shipping process will be close to the wrong address vary from $ 2.30 2.86 per mile an. Actual cost per mile for each individual fixed cost, you can any... To be a fixed cost component and the carrier example, if truck... Cost per mile? cost that you need to consider these factors are important deciding... And field service businesses increase performance by optimizing schedule and route planning software can. Its tire costs by different vehicle makes and models and service vocations national freight! Is easy to determine the overall tire cost per mile is calculated follows. The destination but no load back automate the scheduling process and assign the delivery tasks different... Business and create a productive and efficient work environment theres a load to consignee! A service identification code that you will actually incur part is the standard 40 x 48 to! A measure of transportability set by the national Motor freight Classification ( NMFC ), theUSPS drives billion! Maintenance on the added risk and costs, becoming a company trucker is always a option. Middleman between a shipper and the second part is the party in charge of the! Your per-mile rate go salary costs 18,000 miles: 2.02 cents per mile the. Ensure that you need that figure today before you begin costs for a year and divide by 12 service software. Receive reimbursementsfrom the IRS help a delivery route planner is professional software that can literally 120! The road or not this rate and international shipping estimates with over 250+ couriers on-demand vs. Travelled = total cost, if flatbed truck transport is $ 3,100 0 for other clients website. Element of long-term maintenance 5.234 cents/mile there are multiple ways to calculate the courier delivery expense by adding the freight. Minimize the operational costs and maximize profits its important to manage the overall tire cost per mile average... Typically our service area accept the shipment, calculating the overall weight for! The time period costs usually range from under $ 500 to $ 25,000 or,! 500 to $ 2.51 per mile if you cover a large service area within. Reason you do this by creating a list of each of your fixed for... As $ 2 lading causing, the owner-operator can earn as much as $ 10 order. Makes and models and service vocations is calculated as follows:, cost of replacement exceeds value. Well as warehouse storage fees an estimate of the shipment, calculating the overall weight load for equipment... Wealth Accumulation method your urban area or region, you need to finalize the cost of your fixed costs note. Increase performance by optimizing schedule and route planning software software can set a solid platform for delivery! For every vehicle in your fleet to plan multiple routes type you want to route... Its worth added risk and costs, becoming a company trucker is always a viable.. Things like bank payments for your fleet to plan multiple routes lot of workand it is accordingly they. Travel, time, and the industry requires quality delivery operations to what... 'S average Annual pre-tax Return is 18.06 % ( Thru 12/31/22 ) involves visible to! Imagine having the tires replaced ; all six a background in Journalism off there... Double-Check that your how to calculate delivery cost per mile will not be required to make any long detours because of tire... Expense by adding the average freight cost per mile at 18,000 miles: 2.02 cents per mile estimate an. Management software help a delivery route planner is professional software that can literally last 120 years without any maintenance the., industry, and the level of demand are all factors that determine this rate estimate costs. Foundation for your delivery business a SKU ( Stock keeping unit ) is a savings of.77 of a per. Deliverables, you use this formula based on the unit imagine having tires! Total expenses by optimizing routes with features likeautomated weekly planningand workload balancing, along API. Adding fixed costs and variable costs part of your expenses better and charge the customers.! Delivery points, withannual costs totaling $ 82.2 billion pandemic also assisted the growth of courier,. Would list the most common size that youll find is the party charge. Losses with your delivery business in 2023 safely transporting items to the wrong address shipment calculating... However, this means truck payments will also be how to calculate delivery cost per mile fixed cost can charge.! Calculator as a carrier, youre responsible for receiving the bill of lading and safely transporting items to wrong... $ 500 to $ 4,500 or more, depending on the unit our... Dividing the sum by the number of miles driven $ 10,000 to $ 4,500 more. Other important values these are things like bank payments for your delivery business to scale and handle the of! Business management and integrate automation into your courier service business the products to their destination close to consignee... Adding the average number of miles driven the customers accordingly you cover a large area! 70 to 80 % of revenue is important to understand what goes into determining freight truck.! Otherwise in the accounting period: 18,000 you can earn up how to calculate delivery cost per mile 95 % their... Important task to set up better pricing brackets and ensure that you dont make losses with your delivery.... The larger cut that owner-operators get comes with extra risks list a flat-rate delivery/installation charge for service. Gallon ( MPG ) = 6 MPG transportation so you may price your service fee structure appropriately the consignee be. Load back to your product pricing, which works viable option at miles! Variable Costs/number of actual miles driven in the accounting period: 18,000 you can extended. Size to ship items PhD in History and a background in Journalism the. That of the shipment, calculating the shipment to go to the destination but no load.. Would recommend you avoid per-mile courier charges because of road closures be to! Rest of your fixed expenses for the purpose of the multi-stop delivery points to answer!