Fuel Surcharge?

[Chris@pirossigns.com]

Is anyone putting a fuel surcharge on there bill? Just wondering, we never have, but alot of people we buy from are charging us.

[Erik Sine]

You have to. As I'm slowly transitioning into a sign component distribution I'm having to add a fuel surcharge on most orders

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[Chris@pirossigns.com]

Thanks for the reply. We have been talking about it for a while now and it got brought up again last night. We are going to start also.

[alltex]

We've discussed it. How do ya'll plan on implementing the rate or charge? What rate are you going to add?

[Chris@pirossigns.com]

I haven't figured that out yet. Any thoughts?

[alltex]

I think for me, when diesel goes over $4.20, that's when I have to get more money. My best guess is my trucks average 7mpg. When they're parked in work mode probably close to the same (if you count running the Miller for tools or welding).

Regular daily average for fuel consumption for me per truck is 20-30 gallons. So a 5 cent per gallon increase works out to $1.50. That would be insane to add to a bill IMO. Now if it hits $5.00 a gallon, that's $24.00 more a day.

I already add for fuel for jobs past 50 miles. I use my 7mpg and add the additional fuel cost on the quote.

I guess the trick is to set a flat rate, where we win some and lose some. So it all averages out, and our customers are treated fairly.

So, I haven't answered the original question. Now I am confused how to proceed. So I will rely on my standard operating procedure, and wing it.

[Chris@pirossigns.com]

We wing it alot also! haha, well I think thats what we are going to do also. We will just charge a flat rate across the board. Something is better than nothing.

[Brian]

We don't mess with fuel charges when it goes up we raise our hourly rate.

[eugene@signmakershc.com]

I've been charging a fuel surcharge for almost 2 years. I have it built into my software (Cyrious), although you can do the same with an excel chart. I have my fuel cost per gallon in 25 cent increments, and my mileage in 10 mile increments up to 50 miles, then I have them in 25 mile increments. I have two trucks, one a bucket truck that gets about 7 mpg and a 23.5 ton crane that gets about 3 mpg. I have a different chart for each truck. I started my baseline fuel cost at $3.00 per gallon (my hourly rate is still what is was when fuel was less than $3.00). If you do a lot of service the additional fuel costs add up quick. At current fuel cost < 4.25 a gallon, for a hundred mile round trip I get an additional $41.70 for my crane and $17.90 for my bucket truck. I didn't raise my hourly rates because for installs it can sometimes really drive the cost up, especially if you are there all day.

[sunshine]

We add a line item to our bill on T&M jobs, equal to 5% of the total man and service truck charge. For example, two men and a truck for one hour = $135, plus fuel surcharge of 5% of $135 = $6.75, total $141.75. It doesn't just cost us going down the road, as the trucks run on site as well. Might not sound like much, but if you figure a 10 hour billable day, it's $67.50 additional revenue to help cover fuel. We've had the surcharge up as high as 8% and as low as 3%. I don't see it ever going away completely.

[Chris@pirossigns.com]

Thanks for the ideas guys. I don't want to add it to my hourly rate, since my rates are already high due to the crazy union labor rates around here. I think I will line item it and add it in at the end.