Cost per kilometre is the one number that lets you compare any vehicle, quote any job and spot waste.
Cost per kilometre tells you what it really costs to move a vehicle one kilometre (or one mile). It is the number transport, delivery and field-service companies use to price jobs, compare vehicles and see when a vehicle has become too expensive to keep.
The formula
Cost per km = all costs for the period ÷ kilometres driven in the period. "All costs" means fuel, repairs, tyres, insurance, licences, loan or lease payments, wages and any other running cost of that vehicle.
Split it in two
Variable costs (fuel, tyres, servicing) grow with every kilometre. Fixed costs (insurance, loans, licences) are the same whether the vehicle moves or not. A vehicle standing still has a very high cost per km, which is a reason to keep it working.
Use real distances
Odometer readings at the start and end of each shift, checked against GPS, give you a reliable distance. Guessing distances is the most common reason cost per km is wrong.
Price jobs with it
Quote at least your cost per km times the distance, plus the driver's time and your margin. Quoting below cost per km means every job loses money, however busy you are.
Let the software do it
Handova works out cost per km (or per mile) for every vehicle from shift reports, fuel, running costs and repairs, in your currency, and shows how it changes month by month.
