Half past four in the morning in a depot yard. Buses in rows with their interior lights on, engines warming, the first duties about to sign on. One bay is empty because the driver who should be standing in it has taken a job at a distribution centre for three thousand pounds a year more.
The 0512 on the town service will not run. Nobody will be on it at that hour, which is not the point. It is a registered service, and a registered service that does not run is a fact recorded somewhere.
That is the trade in one image. A bus company is a set of public promises and a rota, and the rota is the part that decides whether the promises are kept.
Deregulation gave you the routes and gave away the exit
Local bus services outside London were deregulated by the Transport Act 1985, taking effect on 26 October 1986. Before that a route needed a road service licence and was protected, which meant a bus business of the early 1970s was a completely different animal: shielded from competition, frequently municipal, and often losing money by design. After deregulation anybody with an operator's licence could register a service and run it.
The bargain is that registration is easy and withdrawal is not. A local bus service is registered with the traffic commissioner, and changing or cancelling one normally takes fifty-six days' notice. A route you have decided to kill runs for two more months while it loses money. A competitor's withdrawal is public for the same reason, so you can see a gap opening before the passengers do.
Getting in is expensive but not out of reach in the way a railway is: between £1,500,000 and £8,000,000 for a small network, most of it vehicles and a yard to fuel, wash and inspect them in. Buses can be bought second hand, which makes the entry cost more elastic than it looks.
From 2017 a mayoral combined authority has been able to franchise its bus network instead of leaving it deregulated, which turns the business inside out. Under franchising the authority sets the routes, the fares and the timetable, and pays an operator to run the miles. Revenue risk goes away and so does commercial freedom. London was never deregulated at all and has been contracted in something like that way throughout.
Lost mileage is what brings the commissioner
Lost mileage is the share of registered journeys that were not actually operated. It is the figure the whole business turns on, and it is almost entirely a staffing figure.
Vehicles are a solved problem: you can hire one in, or run an older one for a week. Drivers are not. A driver needs a category D licence, the Driver Certificate of Professional Competence with its periodic training, and route knowledge. At a typical salary of around £33,000 the job competes with lorry driving and warehouse work, neither of which starts at half past four or deals with the public.
Once vacancies pass roughly one in ten, the rota stops absorbing them. Rest day working, which was covering the gaps, stops being voluntary in practice, people burn out, and more of them leave. Lost mileage climbs, complaints follow, and complaints are how a traffic commissioner learns your name.
Revenue, meanwhile, is unusually stable. Gross margin on a decent network runs at better than half, because fares are low and volumes are enormous. Concessionary travel for older and disabled passengers is reimbursed by local authorities and puts a floor under the middle of the day. School terms carry the network, and the summer holidays take about a tenth of it out.
VAT works in the operator's favour. Passenger transport in a vehicle carrying ten or more passengers is zero rated under the VAT Act 1994, Schedule 8, Group 8, so fares carry no VAT and the VAT on fuel, parts and vehicles is recoverable. A small standard-rated share remains: advertising on the buses and private hire work.
The traffic commissioner is not an inspector
This is where the trade stops resembling an ordinary business. The public service vehicle operator's licence is held by a traffic commissioner, an independent statutory office, on conditions that continue for as long as you hold it. You must be of good repute. You must have a professionally competent transport manager. You must show financial standing, meaning money available in proportion to the vehicles authorised. The Driver and Vehicle Standards Agency does the inspecting, and what it finds goes to the commissioner.
The powers that follow are not fines in the ordinary sense. A commissioner can call a public inquiry, at which you appear and explain yourself. The inquiry can curtail the licence, cutting the number of vehicles you are authorised to run, which is fatal if your network needs more than you are left with. It can find that you have lost your repute and revoke the licence, and it can disqualify the transport manager personally.
Set against that are the usual obligations of any employer running vehicles: drivers' hours rules, maintenance records that stand up to inspection, and public liability cover. The difference is that here all of it lands in front of one official who already holds the thing that lets you trade.
Something in the region of a thousand firms run local bus and coach networks in Britain, on fare revenue of roughly six billion pounds a year. Those figures describe the scale rather than count it. The traffic commissioners publish an annual report, and the Department for Transport publishes annual bus statistics for England covering receipts and vehicle kilometres.
It ends at a public inquiry
The sequence is depressingly consistent. Drivers leave for better money. Journeys are missed. Passengers complain, and a proportion of the complaints reach the commissioner rather than the depot. A public inquiry is called, and it cuts the licence to fewer vehicles than the network needs. The registrations then have to be handed back, on fifty-six days' notice, because there is no lawful way to run them.
Note what did not happen. Nobody ran out of money first. The failure is operational, it arrives by letter, and it takes effect through an official rather than through a bank. A bus company can be perfectly solvent on the day it stops being allowed to trade.
The other ending is quieter. A council under budget pressure cuts its supported services, and a depot that was half tendered work loses a third of its mileage in a single April. That one is financial, and more common.
Where this shows up in the game
The bus network in Business Baron is one of the specialist trades, and the monthly decision is which registered services to keep, vary or withdraw, in the knowledge that the change takes fifty-six days to take effect. You commit publicly, then you have to honour the commitment with a rota. Nothing else in the game asks that of you in quite that way.
The number you watch is lost mileage, driven by driver vacancies rather than by anything on the balance sheet. The traffic commissioner appears when it climbs: first as correspondence, then as a public inquiry, then as a curtailment that takes vehicles off the licence. Failing here means handing back the registrations while the depot is still full of buses. The Bus & Coach Network page has the licences and the figures behind it.
Like the other specialist trades it runs on top of the full game rather than in place of it. It is also the one to play to find out how good you are at staffing, because that is all it is: a duty board, every morning, filled or not filled.