If you run a courier, same-day delivery, or removals business, you need to price jobs by distance. Here's how distance-based pricing works and how to set yours up.
Distance-based pricing is a pricing model where the cost of a job is calculated based on the distance between two locations. It's the standard approach for courier companies, same-day delivery businesses, man and van operators, and removals companies.
The basic formula is: Price = Base charge + (Distance × Rate per mile)
For example, if your rate is £1.50 per mile with a £15 minimum charge, a 10-mile job costs £15 (minimum). A 20-mile job costs £30. A 50-mile job costs £75.
In practice, most businesses also add surcharges on top of this for same-day delivery, evening or weekend jobs, return journeys, and so on.
This is an important distinction. There are two ways to measure the distance between two postcodes:
Straight-line distance (as the crow flies): The direct geometric distance between two points. Fast to calculate, but often wildly inaccurate for pricing purposes. A job from London Bridge to Canary Wharf is about 2 miles straight-line but the road distance via the most logical route is closer to 4 miles.
Road distance: The actual distance a vehicle would travel via the road network, calculated by a mapping API. This is the distance you should price from.
Always use road distance for pricing. Straight-line distance will consistently underestimate the actual distance and leave you undercharging for jobs.
QuoteKit uses Google Maps to calculate road distance between any two UK postcodes the same technology used by Uber and Deliveroo to price their jobs.
Your rate per mile needs to cover:
- Fuel costs (typically around 14–18p per mile for a van at current UK petrol prices) - Vehicle depreciation (typically 5–10p per mile for a van) - Your time (a driver on £15/hour doing 30mph covers 30 miles per hour that's 50p per mile just for labour) - Insurance, overhead, and profit margin
As a rough guide, most UK courier businesses charge between £1.00 and £2.50 per mile depending on vehicle type and service level. Man and van removal businesses typically charge between £1.00 and £1.80 per mile.
For motorbike couriers, rates are often lower (£0.70–£1.20 per mile) because fuel and running costs are lower.
Start with a number that covers your costs and gives you a reasonable margin. You can always adjust it once you see how customers respond.
A minimum charge prevents you from losing money on very short jobs. If your rate is £1.50 per mile, a 3-mile job would be £4.50 less than it costs you to do it.
Most courier and van businesses set a minimum charge of £15–£30. This means any job within a certain radius is charged at the minimum, regardless of the exact distance.
In QuoteKit, you can set a minimum charge per service. The calculator automatically applies it if the calculated distance-based price falls below the threshold.
Some jobs involve more than one pickup or drop-off location. For example, a courier might collect from two locations before delivering to one destination. Or a removal company might need to collect from a property, drop furniture at a storage unit, and then continue to the new home.
For multi-stop jobs, you have two options:
Price by total road distance: Calculate the total distance of the entire route (A to B to C) and apply your rate per mile to the total.
Price by number of stops: Charge a fixed add-on fee per additional stop. For example: £10 per extra collection or drop-off point.
QuoteKit supports both approaches.
For return journeys, you can either include the return in your rate (i.e. price the round trip) or only charge for the outbound journey (common for removals you pick up a full load and return empty). Make sure your pricing reflects this clearly.
Most courier and removals businesses apply surcharges for jobs that are more difficult or more in demand:
Same-day / urgent: Typically 15–30% premium. Customers requesting immediate collection or delivery expect to pay more.
Evening jobs (after 6pm or 7pm): Typically 10–20% premium.
Weekend and bank holiday: Typically 15–25% premium.
Heavy or large items: A flat fee added for items above a certain weight or requiring special equipment.
QuoteKit lets you configure all of these as automatic surcharges. The calculator applies them based on when the customer requests the job and what they've selected no manual calculation needed.
Here's an example pricing structure for a small van courier business:
Base rate: £1.40 per mile Minimum charge: £20 Same-day surcharge: +20% Evening surcharge (6pm–10pm): +15% Weekend surcharge: +15%
A standard 10-mile job booked in advance: 10 × £1.40 = £14.00 → minimum charge applies → £20 A same-day 25-mile job: 25 × £1.40 = £35 × 1.20 (same-day) = £42 A Saturday evening 15-mile job: 15 × £1.40 = £21 × 1.15 (weekend) × 1.15 (evening) = £27.77
QuoteKit calculates all of this automatically and shows the customer their price in real time as they fill in the form. You set the numbers once the calculator does the rest.
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