Why you should be tipping your delivery drivers this Christmas: Bird Lovegod

Here’s the basics of how it works, as a job, based on my experience.

Firstly, it’s not a job.

You are not being employed by any company, except your own. Instead you are required to create a limited company, and be a director of it.

Your company will then be able to provide services to other companies. In order to do this as a driver you will of course need a van.

The subcontracting company can help with facilitating this, a van costs £195 a week, plus VAT.

Plus a £500 deposit, which can be paid weekly over 12 weeks.

If arranged by the company this includes insurance, with a £2,500 excess if you cause an accident.

So like any business, there’s risks, liabilities and costs involved. But how much can one make?

After four days training, for which you are paid £110 a day, you are on the road. You, or rather your limited company, receives around £145 a day, and this will involve delivering 150 to 180 parcels in a highly organised predetermined route which you follow on an app.

You hand the parcel over, or leave it in a safe place and take a photo. We’ve all been on the receiving end of that process. If no one is in you are required to attempt a second delivery later in the day.

Ever wondered why the delivery guys are always in a rush, running from van to house, getting you to sign, then dashing off again?

Here’s why… if they’re doing 180 deliveries a single minute added to each one, just by walking slowly, equals a three hour difference in the time it takes to complete the route.

You’ll also receive a mileage allowance, something like 22p a mile, and you get a couple of quid a day for using your own phone.

And there you go.

The routes are expected to take nine hours, plus the time it takes you to get to the depot in the morning, and back home from the last delivery.

So a driver can expect to make about £150 a day.

It’s hard work, and a long shift, and if one is hiring a van on a monthly basis, there's £1,000 a month in van hire.

So for the first seven days work, all you are really doing is paying for the van.

Which makes doing a three or four day week an unattractive proposition, as you’re basically working to cover that expense.

Then there’s risks. Damage to the van could wipe out a month's profit.

There’s accountancy costs, if you have an accountant to manage your limited company, and of course, you’ll be parking your van outside your home every day.

Some drivers hire a van for the first three or six months, then buy one on finance.

With some companies, the cost of deliveries is so digitised and fractionalised through the entire supply line that the driver receives his wage daily, viewable in the app of course.

For a five day week, they might take home £500 after costs.

At Christmas, when your parcels arrive, tip the driver.

Bird Lovegod is MD of Ethical Much