How do I Calculate Transport Costs?

When farmers take their product to market they pay a transport cost. There are many variables that determine the final cost, such as payment to a driver for delivery of product to destination. This may include cost per container (or weight per container), road taxes, tolls, fuel and maintenance fees. Transporting several different agricultural products like peppers and fruit can affect the total of transport costs due to the variable in weight and volume in containers. It is important that the cost is calculated correctly. Mistakes are expensive.

Transport can add significant costs.

Step 1

Calculate the cost of ground transportation. Include the number and cost of containers to be transported (if paying a set fee per container or paying per weight), driver fees (along with fees associated with maintaining his truck) and fuel costs (single or round trip). In addition, you are paying for the fees of the truck whether it is full or not, so combine your costs by joining with other farmers to fill the truck to capacity.

Step 2

Total the final number of boxes of product to be shipped and their weight per unit, if applicable. Determine the amount of taxes (road and/or shipping taxes), cost of personnel or workers.

Step 3

Multiply the ground transportation number by the number of boxes to be transported, which equals the total cost of transport. As with the fluctuating prices of supply and demand, the total cost of transport can vary. There are other methods of transport such as air and sea. Add in the cost of ground transportation to the additional transportation costs.