The Hidden Cost of Route Density Inefficiency
If your techs are paid hourly and a big part of the day disappears into windshield time, your labor cost per job is climbing even though nobody did anything wrong. Route density never shows up as its own line on the P&L, so it can eat margin for years before anyone traces it back to the cause.
Windshield Time Is Labor Cost With No Job Attached
Every hour a tech spends driving between stops is an hour you’re paying for that isn’t going toward a billable job. On a route with tight, clustered stops, that might be a small slice of the day. On a scattered route covering a wide territory, it can be a lot more. The same crew, at the same wage, working the same hours, produces less billable work purely because of how the stops are laid out.
Let’s say a two-person crew costs about $25 an hour each, loaded, and spends two and a half hours a day driving between stops. That’s about $125 a day in paid drive time, or roughly $2.5k a month, and around $30k a year for one crew. That number usually isn’t on anyone’s radar since it’s buried inside total labor.
It Feeds Straight Back Into Pricing
This is the part that’s easy to miss. If the pricing assumes a crew can hit six stops a day and the real number, once you count drive time, is closer to four, every job is priced as if labor is cheaper than it is.
| What the price assumed | What the route delivers | |
|---|---|---|
| Crew labor for the day (2 techs, 8 hours, about $25/hr loaded) | $400 | $400 |
| Stops per day | 6 | 4 |
| Labor cost per stop | About $67 | $100 |
Every stop is costing about $33 more in labor than the price was built for. Even a crew running as efficiently as the territory allows can still be underpriced if travel time never got built into the rate in the first place. At that point, tighter routing helps, but the price also has to cover the travel time the route really requires.
How to Tighten the Route
- Zone the schedule. Assigning parts of the territory to specific days (north side Monday, south side Tuesday) keeps crews from crossing town twice in one day. Recurring customers usually adjust to a set service day pretty easily.
- Sell where you already are. A new customer on a street you already service is worth more than the same customer 25 minutes away, since the drive is already paid for. Door hangers or a neighbor discount around existing stops can help fill in the gaps.
- Price the far-out customers differently. A trip charge or a higher minimum for customers outside the core area means the drive time gets paid for instead of absorbed.
- Look at routing software. If the schedule is being built by hand, routing tools can often find a better stop order than the dispatcher’s gut, especially as the number of stops grows.
Two Ways to Attack It From the Pay Side
One option some of the shops we work with have moved toward is a commission or per-stop pay structure instead of a flat hourly rate, which shares some of the density risk with the pay structure instead of leaving all of it on the owner. It still needs a reasonably dense route to work for the tech, since nobody wants to drive an hour between two stops for the same pay as two stops five minutes apart, but it changes the incentive. If you go this route, make sure the structure still meets minimum wage and overtime rules, so it’s worth running it by your payroll provider or an employment attorney before rolling it out.
The other option, when overtime from a packed but inefficient route is the real problem, is adding headcount to shrink each person’s route. Let’s say three techs are each running about 10 hours of overtime a week at time and a half, which at $25/hour loaded is roughly $1.1k a week, or somewhere around $58k a year. A new full-time tech at the same rate costs around $52k a year, loaded, and adds capacity on top of cutting the overtime. The math won’t always come out that way, and a new hire brings training time and a truck to think about, so this is the kind of decision where it’s worth sitting down with a financial professional and running your real numbers before deciding which way to go.
What to Track
Total miles driven is useful, but the number I’d watch is paid hours that aren’t attached to a billable stop, as a percentage of total paid hours:
(Total paid hours − hours on-site at stops) ÷ total paid hours = windshield time percentage
Most field service software can pull on-site time from clock-in and clock-out at each stop. Once you have that number by route or by crew, you can see which routes need attention and whether the fix is tighter geography, a different pay structure, or a price adjustment that reflects the travel time the business really requires.
Where to Start
If you want one thing to do this week, pick one crew and add up how many hours they were paid last week against how many hours they spent at stops. The gap between those two numbers is what the route is costing you.
If windshield time feels like it’s eating your margin, a free Cash Clarity Call is a good place to find out how much.
