Calculate profitability by route. Optimize routes for maximum revenue. This tool helps you calculate, understand, and optimize this metric for your business.
The break-even load factor is the figure to watch: below 63% occupancy the vehicle loses money that day regardless of how many trips it makes. This models the daily cash only. It does not include vehicle finance, insurance, licensing, Sacco charges, maintenance or the replacement cost of the vehicle, and leaving those out is how a route looks profitable for two years and then does not.
Revenue on a route is fare times seats times trips times how full the vehicle actually runs. Costs on the day are fuel, crew and everything else paid daily. The useful output is the load factor at which the two meet.
Below that occupancy the vehicle loses money that day regardless of how many trips it makes, which is why adding trips to a poorly loaded route usually makes the problem worse rather than better.
This models daily cash only. It excludes vehicle finance, insurance, licensing, Sacco charges levied other than daily, scheduled maintenance and the replacement cost of the vehicle itself.
Leaving those out is exactly how a route looks profitable for two years and then does not. Take the daily profit, subtract a realistic monthly provision for all of them, and judge the route on what is left.
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