A truck can bring in revenue and still lose money on a lane. Cost per kilometre gives the operator a way to compare the money spent with the distance the vehicle actually travelled. The calculation is simple; choosing a complete cost window and a trustworthy distance takes care.
Start with one vehicle and one period
Choose a truck and a month or a set of completed trips. Use costs and kilometres from that same window. A fuel bill from September divided by trips from August looks precise but answers no useful question. Record the source of each number so the next review can repeat the calculation.
Cost per km = costs in the chosen window ÷ measured kilometres in that window.
Decide which costs belong in the numerator. Fuel and completed workshop spend show a useful operating cost. Add the driver settlement to see a broader direct cost. A quote may also need tolls, tyres, insurance, finance, permits and overhead. Keep those extra allocations visible rather than quietly mixing unlike cost measures.
A worked example in Kenyan shillings
Suppose one truck covers 2,000 measured km across its completed trips in a month. Its recorded fuel purchases are KES 180,000, completed workshop work is KES 40,000, and attributable driver settlements are KES 35,000. These are illustrative figures, not a Kenyan fleet benchmark.
- Operating cost: (180,000 + 40,000) ÷ 2,000 = KES 110/km.
- Direct cost including driver pay: (180,000 + 40,000 + 35,000) ÷ 2,000 = KES 127.50/km.
- If invoices attributable to those trips total KES 320,000, revenue per km is KES 160/km and the difference after these recorded direct costs is KES 32.50/km.
That difference is not net profit. The example has not allocated tyres, insurance, financing, office costs or tax. Do not use it as the minimum price for the next job until the omitted costs and expected empty return have been considered.
Count the distance the truck actually drove
A trip's opening odometer belongs at actual start, not at dispatch planning. Its closing reading belongs at completion. With a live vehicle feed, the readings can be captured without typing; otherwise the driver enters the truck's reading. The completed trip keeps its readings even when that vehicle takes another job. Learn how to keep the rest of the operating record together in the fleet management guide for Kenya.
Count empty return kilometres in vehicle operating cost. A truck returning from Eldoret to Nairobi still uses fuel and incurs wear, even if the return leg earns nothing. Keep loaded kilometres as a separate commercial measure. If a replacement truck takes over mid-trip, calculate each truck's distance from its own leg readings.
Treat missing readings as missing data
A trip without a valid closing reading cannot contribute a reliable distance. Do not replace it with zero or a planned route length. If its fuel and workshop costs remain in the numerator while its kilometres are absent, the displayed cost per km will read too high. Review the missing trips before comparing trucks or changing prices.
Fuel consumption has a related measurement problem: litres purchased during a period are not automatically litres burned by the trips in that period. For a clean economy baseline, use a consistent full-to-full test or reconciled tank measurements. Our truck fuel consumption guide works through the km/L calculation and common errors.
Use the number to make one decision
Compare the same truck over comparable windows, or comparable vehicles doing similar work. A high cost per km might reflect a repair month, a heavy load, idling, empty running, a fuel-recording error or missing distance. Investigate the cause before attributing it to a driver. For a lane quote, combine measured cost with expected return movement, waiting, risk and the margin the business requires.
Kora's fleet economics view separates fuel and workshop operating cost from driver settlements, shows revenue alongside them, and flags incomplete trip distance. It is an operating review, not a full accounting allocation or an automatic freight quote.