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How to calculate cost per mile for your business

how to calculate cost per mile

Are you wondering how to calculate cost per mile? Well, almost every business has to do some form of calculation to estimate how much it will cost them to travel from one place to another. Whether you’re a taxi cab company, a trucking business, or an airline, you need to have a good sense of what your cost per mile is in order to stay profitable. 

In this blog post, we’ll show you how to calculate the cost per mile for your specific business. We’ll also provide some tips on ways that you can reduce your costs and improve your bottom line. 

Data gathering


There are two types of expenses that you need to consider when gathering data for your business: fixed expenses and variable expenses. Fixed expenses are those that remain the same each month, such as rent or a mortgage payment. 

Variable expenses, on the other hand, can fluctuate from month to month, such as the cost of repairs or the price of gas. 

When gathering data for your business expenses, it is important to track both types of expenses so that you can get a clear picture of where your money is going each month. This will help you make informed decisions about where to cut costs and how to best manage your finances. 

how to calculate cost per mile

Total miles driven 

There are a few ways to collect data on total miles driven. One way is to ask people how many miles they drove in the past week, month, or year. Another way is to track total mileage using GPS tracking devices or apps. 

Finally, you can look at records from car dealerships, rental companies, or oil changes. If you’re asking people how many miles they drove, you’ll need to design a survey that includes this question. 

You can administer the survey online, in person, or over the phone. Be sure to explain why you’re asking for this information and what you’ll do with it.

Calculating cost per mile

To calculate your cost per mile, simply divide your total expenses by the total number of miles driven. This will give you an accurate representation of how much each mile is costing you in terms of fuel, maintenance, and other associated costs. 

Keep in mind that this figure can vary based on several factors, including the type of vehicle you drive and your driving habits. Nevertheless, knowing your cost per mile can be a valuable tool in helping you keep your overall driving expenses down. If you’re not sure how to calculate your cost per mile, there are a few simple ways to do it. 

First, add up all of your monthly car-related expenses, including fuel, insurance, and repairs. Then, divide that number by the total number of miles you drove during the month. This will give you your average monthly cost per mile.

how to calculate cost per mile

Tips to optimize your cost per mile 

Here are some logistics tips to optimize your cost per mile:

Software / Automation

There’s no question that one of the biggest challenges in running a trucking company is controlling costs. fuel is one of the largest operational expenses for any trucking company, and it can be very difficult to keep track of all the different factors that affect your cost per mile. 

One way to help control these costs is to use software or automation to help you track your expenses. By using these tools, you can more easily see where your money is going and identify areas where you can save. 

Additionally, they can help you keep track of your drivers, so you can be sure you’re getting the most bang for your buck.

Route optimization

To optimize your cost per mile, use route optimization. By using route optimization, you can minimize the number of miles you drive and the amount you spend on gas. Route optimization can also help you avoid traffic jams and other delays. There are several ways to optimize your route. One way is to use a GPS system. 

GPS systems can help you plan the most efficient route by taking into account traffic conditions, construction, and other factors. Another way to optimize your route is to use a map. MapQuest and Google Maps are two popular options. 

By inputting your starting location and destination, you can see different route options and estimated travel times. You can also get directions and traffic updates. 

You can also use a route planner. A route planner can help you find the shortest, most direct route between two points. It can also provide you with turn-by-turn directions and estimated travel times.

how to calculate cost per mile

Regular maintenance on vehicles

One of the best ways to optimize your cost per mile is to keep your vehicles well-maintained. This means regular oil changes, tune-ups, and other preventive maintenance. 

By keeping your vehicles in good condition, you’ll avoid costly repairs down the road and extend the life of your vehicles. Another way to reduce your cost per mile is to drive defensively. This means being aware of your surroundings and other drivers on the road and driving in a way that minimizes the chances of an accident. 

Defensive driving can help you avoid costly repairs or replacements, as well as expensive insurance premiums.

Centralized dispatching

There are many ways to optimize your cost per mile, but one of the most effective is to use centralized dispatching. This involves having a central location from which all of your drivers are dispatched. This can help to reduce costs by eliminating the need for multiple dispatch centers and increasing efficiency. 

Additionally, it can help to improve communication between drivers and dispatch, as well as improve coordination between different parts of your operation. If you are looking to optimize your cost per mile, consider using centralized dispatching. 

This can help to reduce costs, increase efficiency, and improve communication and coordination throughout your operation.

What more…

If you’re looking to optimize your cost per mile, there are a few other techniques you can use. One is to drive fewer miles. This can be done by carpooling, taking public transportation, or simply driving less often. Another way to reduce your cost per mile is to be more fuel-efficient. 

This means driving slower, avoiding quick starts and stops, and keeping your tires properly inflated. You can also look into alternative fuels such as biodiesel or electric vehicles. 

Finally, you can try to negotiate a lower rate with your insurance company. If you have a good driving record, they may be willing to give you a break on your premium.


Calculating your cost per mile is an essential step in determining the profitability of your business. 

By taking into account all of the costs associated with operating your vehicle, you can make informed decisions about whether or not it’s worth it to run a particular route or offer specific services.


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