Most haulage and distribution businesses know whether they are profitable overall. Far fewer know which contracts, routes or customers actually make money.
Job costing closes that gap. It matches every cost of a piece of work against the revenue it earns, using what was actually spent rather than estimates. Dynamics 365 Business Central provides the tools to do it, and this article explains how it works and why accurate numbers matter.
Why Haulage Businesses Struggle with Job-Level Profitability
Costs are usually recorded for the business as a whole, but not allocated to the jobs, routes or customers that caused them. Fuel, driver wages and vehicle maintenance sit in separate accounts with no link to a particular contract or run.
Without job-level data, pricing relies on estimates, renewals are negotiated blind and the least profitable customers stay hidden.
How Job Costing Works in Business Central
Business Central's Projects feature (previously called Jobs) records costs and revenue against units you define, such as a contract, a route or a freight movement.
Setting up projects to match the business
Each project in Business Central has a budget, tasks for each cost category (driver, fuel, vehicle overhead and subcontractors) and tracking of actual costs. Budget lines hold the estimate you priced on. Actual lines build up the real spend as it is posted.
Posting costs against projects
Driver time is allocated to the relevant projects as well as to payroll. Fuel is linked to vehicles and, through a vehicle dimension, to the routes those vehicles ran. Subcontractor invoices are posted directly to the project they relate to.
The result is an up-to-date view of cost against budget and revenue for every project, as each cost is posted.
Using dimensions to track costs across several views
When a cost is posted, it can be tagged with dimensions for the project, vehicle, driver and region at the same time. That lets you analyse costs from several angles at once: what a vehicle costs across all its routes, for example, or how profitable a customer is across every vehicle that serves it.
What Accurate Job Costs Enable
Informed contract pricing
Once you know what it really costs to serve a customer, you can price future contracts on evidence rather than estimates. Contracts that look attractive sometimes turn out to be marginal, while unremarkable ones can be among the most profitable.
Evidence-based contract reviews
A measured cost history strengthens your hand at renewal. Cost increases documented line by line make a request for a rate rise far more credible.
Vehicle fleet decisions
Tracking costs by vehicle shows whether older, high-maintenance vehicles still make commercial sense. That decision is hard to make without data and straightforward with it.
Subcontractor cost control
When subcontractor spend is recorded by contract and route, you can compare it fairly with the cost of your own fleet and make clearer decisions about when to use each.
Getting the Configuration Right
Job costing needs deliberate setup. Projects have to reflect how the business is structured, postings have to land on the right project and reports have to answer real commercial questions.
Advantage configures Dynamics 365 Business Central for logistics businesses with that sector structure in mind. For the wider picture, see Faster, Smarter Financial Control.
Talk to Our Logistics Team
If you cannot say which customers, routes or contracts are profitable, that is a problem with a practical fix.
Contact Advantage today or call 020 3004 4600 to speak to our team.
Related Resources
- Faster, Smarter Financial Control
- Dynamics 365 Business Central
- Power BI for Logistics: The 6 Dashboards That Replace Your Spreadsheets
- Supply Chain, Stock and Procurement Control
- Logistics and Distribution Solutions
Frequently Asked Questions
Does Business Central include job costing functionality?
Yes. Business Central includes Projects (previously called Jobs), which can track delivery contracts, routes or customers, with driver, fuel, maintenance and subcontractor costs recorded against each.
What costs should a haulage business track at job level?
Include direct driver costs, fuel for each run, a share of vehicle depreciation or lease costs, subcontractor charges and other costs such as tolls, congestion charges, ferry crossings and pallet network fees. Leave any of these out and margins will look better than they really are.
How do distribution businesses price contracts without accurate job costs?
Usually from market rates, experience and estimates of direct costs. Those estimates often miss overheads, empty running and admin, so contracts look more profitable than they are.
Can Business Central track costs by vehicle as well as by job?
Yes. Dimensions can tag costs to a vehicle code, so you can report fuel, maintenance, driver time and depreciation for each vehicle. Combined with revenue, that gives you profitability by vehicle.
