Scribd
Upload
63 views15 pages

Amazon Fresh Refrigerated Box Truck Analysis: Jacob Gourlay - Consultant

Uploaded by

Jake

The document analyzes refrigerated truck options for Amazon Fresh grocery deliveries, finding that a Hino brand truck has the lowest estimated annual worth at $62,037 based on mileage, fuel efficiency, and resale value. It recommends purchasing a Hino truck and using declining balance depreciation to maximize tax deductions over the truck's 7-year lifespan, saving over $1,800 in taxes compared to straight-line depreciation.

Copyright:

© All Rights Reserved
Download as PPTX, PDF, TXT or read online from Scribd
Download as pptx, pdf, or txt

Amazon Fresh Refrigerated Box Truck Analysis: Jacob Gourlay - Consultant

Uploaded by

Jake
63 views15 pages
The document analyzes refrigerated truck options for Amazon Fresh grocery deliveries, finding that a Hino brand truck has the lowest estimated annual worth at $62,037 based on mileage, fuel efficiency, and resale value. It recommends purchasing a Hino truck and using declining balance depreciation to maximize tax deductions over the truck's 7-year lifespan, saving over $1,800 in taxes compared to straight-line depreciation.

Original Title

MNET 414 Final Project Presentation JGourlay

Copyright

© © All Rights Reserved

Available Formats

PPTX, PDF, TXT or read online from Scribd

Did you find this document useful?

Is this content inappropriate?

The document analyzes refrigerated truck options for Amazon Fresh grocery deliveries, finding that a Hino brand truck has the lowest estimated annual worth at $62,037 based on mileage, fuel efficiency, and resale value. It recommends purchasing a Hino truck and using declining balance depreciation to maximize tax deductions over the truck's 7-year lifespan, saving over $1,800 in taxes compared to straight-line depreciation.

Copyright:

© All Rights Reserved
Download as PPTX, PDF, TXT or read online from Scribd
Download as pptx, pdf, or txt
63 views15 pages

Amazon Fresh Refrigerated Box Truck Analysis: Jacob Gourlay - Consultant

Uploaded by

Jake
The document analyzes refrigerated truck options for Amazon Fresh grocery deliveries, finding that a Hino brand truck has the lowest estimated annual worth at $62,037 based on mileage, fuel efficiency, and resale value. It recommends purchasing a Hino truck and using declining balance depreciation to maximize tax deductions over the truck's 7-year lifespan, saving over $1,800 in taxes compared to straight-line depreciation.

Copyright:

© All Rights Reserved
Download as PPTX, PDF, TXT or read online from Scribd
Download as pptx, pdf, or txt
You are on page 1/ 15

Amazon Fresh

Refrigerated Box
Truck Analysis
Jacob Gourlay - Consultant
Amazon Fresh Contract - Background
• SOLG contracts with e-commerce giant Amazon have led to
considerable growth in the last 10 years
• Pre-existing relationship means good position to continue growth
• Amazon Fresh is a grocery delivery service
• Food safety regulations
• Requires the acquisition of specialized equipment
• Currently SOLG holds no refrigerated trucks
• Buying new, not used, while costly, would be more advantageous
• More reliable, Longer expected life
• Critical to provide safe, reliable transportation
Alternatives & Analysis
Alternatives

• Compiled a short list of four manufacturers trucks


• Available within a reasonable time frame
• Most refrigerated box trucks conform to the same standards
• Variables considered
• Gas-Milage
• Diesel Tank size
• MSRP with refrigeration mods included
Analysis

• Analysis done using data for one vehicle


• Calculated and Compared EUAW
• EUAC based on MSRP and a Cost-Per-Mile Estimate of $1.50
• EUAB based on annual value of one route and the resale value of
the vehicle
• Performed Benefit/Cost Analysis
• Used to validate findings in first comparison
Isuzu
MSRP $ 93,000.00
Gas Mileage 13
Diesal Tank (Gal) 57
Max Milage Per Day 150.00
Max Milage Per Year 54,750.00
Annual Cost per Mile $ 75,555.00
EUAC $ 91,625.40
Contract Annual Value $ 150,000.00
Salvage Value $ 18,600.00
EUAB $ 152,284.08
EUAW $ 60,658.68
Hino
MSRP $ 83,700.00
Gas Mileage 12
Diesal Tank (Gal) 58
Max Milage Per Day 150.00
Max Milage Per Year 54,750.00
Annual Cost per Mile $ 75,555.00
EUAC $ 90,018.36
Contract Annual Value $ 150,000.00
Salvage Value $ 16,740.00
EUAB $ 152,055.67
EUAW $ 62,037.31
International
MSRP $ 106,950.00
Gas Mileage 10
Diesal Tank (Gal) 60
Max Milage Per Day 150.00
Max Milage Per Year 54,750.00
Annual Cost per Mile $ 75,555.00
EUAC $ 94,035.96
Contract Annual Value $ 150,000.00
Salvage Value $ 21,390.00
EUAB $ 152,626.69
EUAW $ 58,590.73
Freightliner
MSRP $ 102,300.00
Gas Mileage 11
Diesal Tank (Gal) 55
Max Milage Per Day 150.00
Max Milage Per Year 54,750.00
Annual Cost per Mile $ 75,555.00
EUAC $ 93,232.44
Contract Annual Value $ 150,000.00
Salvage Value $ 20,460.00
EUAB $ 152,512.49
EUAW $ 59,280.05
EUAW COMPARISON
Isuzu Hino Freightliner International
$63,000.00

$62,037.31
$62,000.00

$61,000.00
$60,658.68
EUAW

$60,000.00

$59,280.05
$59,000.00
$58,590.73

$58,000.00

$57,000.00

$56,000.00
Results

• Following both the EUAW


Comparison and B/C
Analysis
• Hino Brand trucks are
recommended
• EUAW = $62K
Tax & Depreciation
Depreciation

Year SL DBD DBD Charge to date


$ -
1 $ 9,565.71 $ 23,914.29
2 $ 9,565.71 $ 17,081.63 $ 23,914.29
3 $ 9,565.71 $ 12,201.17 $ 40,995.92
4 $ 9,565.71 $ 8,715.12 $ 53,197.08
5 $ 9,565.71 $ 6,225.08 $ 61,912.20
6 $ 9,565.71 $ 4,446.49 $ 68,137.29
7 $ 9,565.71 $ 3,176.06 $ 72,583.78
Total $ 66,960.00 $ 75,759.84  
Taxes
Taxes using DBD Taxes using SLD
Year Taxble Income Taxes Paid Taxble Income Taxes Paid
1 $ 42,385.71 $ 8,901.00 $ 56,734.29 $ 11,914.20
2 $ 49,218.37 $ 10,335.86 $ 56,734.29 $ 11,914.20
3 $ 54,098.83 $ 11,360.76 $ 56,734.29 $ 11,914.20
4 $ 57,584.88 $ 12,092.83 $ 56,734.29 $ 11,914.20
5 $ 60,074.92 $ 12,615.73 $ 56,734.29 $ 11,914.20
6 $ 61,853.51 $ 12,989.24 $ 56,734.29 $ 11,914.20
7 $ 63,123.94 $ 13,256.03 $ 56,734.29 $ 11,914.20
Total $ - $ 81,551.43 $ - $ 83,399.40
Conclusion

• Purchase Hino brand


• Follow DBD to maximize
depreciation and minimize
taxes paid over life of asset

You might also like