Delivery Cost Calculator

Delivery route cost and time estimation combines vehicle operating costs, driver wages, and distance/time calculations to determine whether a delivery operation is profitable and how to optimize route efficiency.

Total delivery cost formula: Total Cost = (Distance × Cost per Mile) + (Time × Hourly Driver Cost) + Fixed Costs

Cost per mile breakdown: Cost per Mile = Fuel Cost + Depreciation + Insurance + Maintenance

• Fuel: (Distance ÷ MPG) × Fuel Price per Gallon
• Depreciation: ~$0.08–$0.15/mile for vans; higher for heavy trucks
• Insurance: ~$0.05–$0.10/mile (annual premium ÷ annual miles)
• Maintenance: ~$0.05–$0.12/mile

IRS standard mileage rate (2025): $0.70/mile (covers all vehicle costs; commonly used for reimbursement and tax deduction). The IRS revises this every year, so check the current figure before using it on a tax return.

Delivery time formula: Total Route Time = Driving Time + Stop Time × Number of Stops + Loading Time

What each variable means:

• Driving time = Total route miles ÷ Average speed (consider traffic; 20–30 mph in urban areas, 45–55 mph on suburban routes)
• Stop time = time at each delivery: unloading + customer interaction + documentation; typically 5–15 minutes per residential stop, 15–30 minutes per commercial stop
• Load factor: partial loads waste capacity, and full truck utilization is what makes a route pay
• Route optimization: a poorly planned 15-stop route can add 30–40% extra miles against an optimized sequence. Routing software like Circuit or OptimoRoute typically saves 15–25% in fuel and time

Reference: delivery cost benchmarks:

• Small van, suburban route: $0.60–$0.90/mile total cost
• Cargo van, urban route: $0.80–$1.20/mile
• Box truck: $1.00–$1.80/mile
• Last-mile delivery cost (e-commerce): $8–$15 per package average

Worked example (building full cost from the fuel number): This calculator returns the fuel line below ($13.52). To price a route, add driver wages, vehicle wear, and overhead on top, as shown here.

10-stop route, 8.5 miles between stops, so 85 miles total. Cargo van averaging 22 MPG. Gas $3.50/gallon. Driver: $22/hour. Average stop time: 10 minutes. Drive time: 2.5 hours.
Those first four numbers are what the form above takes: 10 stops, 8.5 miles, 22 MPG, 3.50 fuel.

• Fuel cost = (85 ÷ 22) × $3.50 = 3.86 × $3.50 = $13.52
• Vehicle costs (depreciation + maintenance + insurance) ≈ $0.22/mile × 85 = $18.70
• Driver wage = (2.5 hours driving + 10 stops × 10min/60 = 1.67hr) × $22 = 4.17 × $22 = $91.67
• Fixed overhead allocation (insurance, dispatch software) = $15 (estimated daily allocation)
• Total route cost = $13.52 + $18.70 + $91.67 + $15 = $138.89 for 10 deliveries
• Cost per delivery = $13.89

If charging $18/delivery: profit = $4.11/delivery × 10 = $41.10 route margin. Viable, but thin.
The fix is almost never charging more. It is adding stops, because the driver hour and the van are already paid for. Two or three extra deliveries that fit into the existing route sequence are nearly pure margin, which is the whole reason density beats price in last-mile work.