10314I’ve had a couple of phone calls this week, and an email, from drivers either thinking about becoming a courier, or one’s that have just started out and were after advice on rates. This was my response to a guy who had yet to start, but had been on several forums saying they were quite negative and to the girl that rang yesterday who had just worked out she’d actually lost £3 by doing a job at 60pplm. Now i’m no expert, but this was my advice. Any newbie or potential newbie can take it or leave it.
"The problem with any forum is it does tend to get negative quite quickly. Having said that, if you can edit out the negativity then there is an awful lot of useful information available. There are two rates that you should have, one for trade i.e. other Courier Companies who sub any work out they can’t cover with their own drivers to outside contractors, and the other rate for the end user, i.e your customers. What you charge your own customers is entirely up to you and depends on where in the UK you are, what sort of payment terms they are wanting and you are prepared to offer, and what the opposition is charging. I won't discuss trade rates other than to say if you work for those offering 60pplm or less then you won't last because rates such as these rely on the naive, and like it or not there are a lot of people who will and do get taken advantage of. That’s where these forums try to help by warning newbies of who and what to avoid.
Everyone has different needs, but you should be looking to do around 300 miles a day minimum. Based on a 5 day week that’s around 78,000 miles a year and assuming you get 600 miles per tank, that works out at 130 tanks of fuel per year. If you reckon on a tank costing £75 or so then that works out at £9750 on fuel. Insurance, let’s say £2500, Goods in transit £250 per year, MOT and servicing another £2500 per year and after 3 years your van will need replacing with a new one!
I can see why you think forums are negative because after reading my reply to you it all sounds pretty pointless even thinking of starting out.
So to summarise, you will have fixed costs of around 15k a year (based on my 300mile 5 day example) Bearing that in mind, and as you are the only one that knows what you need to survive, you should be able to work out how much to charge. I would strongly suggest that as well as the fixed costs you try and put aside some money for the next van once this one has done its 3 year slog.
Getting your own customers is hard, but if you combine that with subbing from other Courier Companies, at a rate that works for both you and them, then it is still an industry that can make you a living, but if you pick the wrong companies to work for you’ll soon find you’re working for nothing.
If we take the 60pplm offered by some out there as an example then you'll see what i mean when i say it’s unworkable
39,000 paid miles @ 60p = £23,400 - fixed costs of £15,000 = £8400 not enough to live on i think you'll agree, and certainly nothing left to put aside for your next van.
This is why we now see the exchange sites sprouting up everywhere, because as at those rates you need to convert as much of your dead mileage into paid mileage as possible.
We are in an industry where in the past, a return load was the icing on the cake, to it now being a necessity, and that explains perhaps, why forums seem to be full of negativity.
Hope that helps and good luck"