What your van really costs per trip
Add up everything the van costs in a year, not just fuel, and divide by the distance you drive. That is your true cost per mile or kilometre. Multiply it by the length of a trip and add the time you spend driving, and you have a fair travel charge instead of a guess.
Ask a tradesperson what the van costs to run and most will say fuel. It is the number that hits you at the pump, so it is the one that sticks. But fuel is only one slice of what keeping a van on the road actually costs.
Insurance, registration, servicing, tyres, repairs and the slow loss of value all keep running whether the van moves or not. Leave them out and every travel charge you set is too low.
The cost you notice and the cost you do not
The pump cost is visible and immediate. The rest arrives in lumps: an insurance renewal, a set of tyres, a repair bill, and the quieter cost of the van being worth less each year. Added together they often outweigh the fuel by a wide margin.
A worked example
Say your van costs $4,500 in fuel, $1,800 in insurance and registration, $2,200 in servicing, tyres and repairs, and $4,500 a year in depreciation or finance. You drive 20,000 km a year. A typical job is a 30 km round trip, taking 45 minutes of driving, and your time is worth $50 an hour:
| Running cost a year | $13,000 |
| Cost per kilometre ($13,000 ÷ 20,000) | $0.65 |
| Vehicle cost of a 30 km trip | $19.50 |
| Your driving time (0.75 hrs × $50) | $37.50 |
| Fair travel charge for the trip | $57.00 |
The same sums work in miles. Divide by the miles you drive and use the round-trip miles, and the method does not change. The fuel was never the real cost, it was about a third of it, and the driving time was the biggest part of the travel charge.
Putting it to work
- Add a travel line to quotes. Showing travel as its own line, based on a calculated cost, is easier to defend than a vague uplift in the job price.
- Set a call-out fee that covers the trip. A flat fee is fine as long as it covers the vehicle cost and your time for a typical trip.
- Know when a distant job is not worth it. Once you can see the cost of the drive, a far-away job at a small price often turns out to be a loss.
- Keep tax separate. The official mileage rate your tax authority uses may differ from your real cost. Use this figure to price your work and check the official rate for your tax return.
Frequently asked questions
What should I include in my van running costs?
How do I charge for travel on a job?
Is the cost per mile the same as the tax mileage rate?
The takeaway
Fuel is only a slice of what the van costs, and driving time is the part most trades forget entirely. Work out the true cost per mile or kilometre once, and every travel charge after that is based on a number rather than a guess.
Keep going: try the Quote and Profit calculator and the True Hourly Rate calculator, or read How to quote a job so you actually make money.