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Transport & delivery / Question & answer

Freight brokerage Route Travel Cost per Visit: worked example

Allocate driving costs across a route.

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Freight brokerage / shipment economics
Answer

With the illustrative inputs below, the result is 16.875 per visit.

Try this with your own numbers

Formula and worked example

Travel allocation = route travel hours × hourly cost / completed visits

Example figures
InputExample
Total route driving hours3
Vehicle and driver hourly cost45
Completed route visits8
Calculated result16.875 per visit

Choose reliable inputs

Compare route time, vehicle cost, delivery density and collection timing. For this freight brokerage calculation, use completed route logs, fuel receipts and delivery records and a consistent definition of one shipment.

  • Carrier charges: include the portion belonging to this shipment or reporting period, and record where the value came from.
  • Admin time: include the portion belonging to this shipment or reporting period, and record where the value came from.
  • Claim handling: include the portion belonging to this shipment or reporting period, and record where the value came from.

Use the same currency for every money input. Do not mix weekly costs with monthly revenue, or count the same expense in both an itemised cost and allocated overhead.

Why does route density affect visit profitability?

More completed nearby visits can share driving time. Use a feasible route rather than assuming travel disappears.

Hourly cost must include the costs you intend to count; on-site delivery labour is separate.

Compare a different assumption

What if this input changes?

If total route driving hours rises by 10%, this example changes by 1.6875 per visit. This shows the effect of one change; it does not predict what will happen.

Open the calculator, save your baseline, then change the input supported by the least reliable estimate in your records. Compare both scenarios before committing to a price or capacity promise.

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