Anyone raise there prices because of the gas price's?

[QuadRacer041]

Dont really get on the site as much as id like to but on the first page of the section of the forum here ive seen a few threads about how much everyone is paying for gas but just in skimming through these threads I didnt say anything about what you guys are doing about it. Is anyone raising there price's to make up for such the huge hit we are taking? I instituted a fuel service charge back in june 04 (after soeaking to a hand full of other landscapers in my area)of about $5 per month to each customer depending on there lawn size. I sent out another letter advising them of an addition $2 per month and explained that it will probably go up again as the gas prices increase.

What are you guys doing about this???

[GreenGrassEarnsCash]

I was wondering the same thing

[jpp]

I have a surcharge in place and it started at 2.25 a gallon. I will keep the surcharge in place and in addition I am going to be raising my hourly rate for leaf removal this fall as well. That should help in the cost of gas. I hope it does at least.

[Dave_B-The_Grass_Guy]

Yeah, I raised my prices earlier this summer when it hit over $2.00 and stayed there over a month. I hadn't raised my prices none since I started commercially about 5 years or so ago. Nearly all of my clients are on a verbal contract, I don't believe in locking people into a full year commitment, then just showing up every week in the winter just to pick up litter. That may be how some companies operate to justify mowing for a reduced fee, but then again, now it's gonna bite them in the ass. Once the contract is in print and signed, they cannot raise their rates until the contract expires. Which is another reason I don't do a written contract, at least not with homes. Commercial accounts are a different breed altogether. Gotta have them in writing.
Now some of the clients decided to go to a "cheaper" firm when I did that, and a couple actually came back. They got their money's worth I guess, and decided I was worth what I charged.

How about the rest of y'all?

[tddcs]

I'm going to do a 10% fuel surcharge.

[topsites]

I ran last year's prices up until now because I have a mayor ad campaign coming out in september, at which time prices are going up across the board: +$5 for ALL grass-cutting fees and +$5 to +$10 hour for everything else BUT:
NEW customers feel the price increase first and foremost.
At the end of the season, those regular grass-customers who are at the bottom of the barrel (have the lowest priced yards, not by amount but $ / size) will be informed that prices will go up by $5 next year, take it or leave it, tyvm :)
Middle-of-the-road regular customers and top-of-$ customers won't see or feel the difference.

That's how I do things, I can't deal with quarters, nickels, and dimes.
And verbal only as well here, even the 2 commercial accounts I have are verbal thou I may check into some county contracts sometime in the future.

[Dave_B-The_Grass_Guy]

I'm going to do a 10% fuel surcharge.


10% of what? Actual cost of fuel? The total bill? I don't follow you. ;)

[dvmcmrhp52]

The increase in fuel costs is a very small percentage of actual costs, it should be added into a yearly increase as normal operating procedure. If it is necessary to add a "fuel surcharge", my guess is that you need to take a better look at your pricing structure.
I'm not busting your stones, it's just the way I see it...... :cool:

[QualityLawnCare4u]

Im tacking on 2.50 at TODAYS prices except 2 Im going up 10 on in hopes it will tick them off or make it worth while.

[grassmanvt]

The increase in fuel costs is a very small percentage of actual costs, it should be added into a yearly increase as normal operating procedure. If it is necessary to add a "fuel surcharge", my guess is that you need to take a better look at your pricing structure.
I'm not busting your stones, it's just the way I see it...... :cool:

I have to agree but, I just raised a bunch of my places five bucks the last billing and probably will do that to some more on the next round (next day off hopefully). Why you ask, when I just agreed that although it affects profits but not at the extreme some are complaining about. Well, the way I figured it, increases were due to a bunch of my customers anyway and what better time then when they see the fuel costs jumping (something they can identify with). So far, I think my hunch was accurate because I haven't had one complaint about it yet. Again, a lot of these increases really were due anyway, maybe I was just too low. Heres another thought. I raised the actual price rather than adding a surcharge. Two reasons. One, I believe that most people don't like surcharges and other hidden cost or fine print. Its nice to know what something will cost, period, without another fee or tax. Two, if documented as a "fuel surcharge" that means when fuel goes down again, price does too, its hard enough to get an increase than have it pulled when you get used to it being there. Anyhow, right or wrong, thats my take on it. Oh yeah, looks like my winter prices will also have to be adjusted, you know, fuel going up and all. :D

[Runner]

The increase in fuel costs is a very small percentage of actual costs, it should be added into a yearly increase as normal operating procedure. If it is necessary to add a "fuel surcharge", my guess is that you need to take a better look at your pricing structure.
I'm not busting your stones, it's just the way I see it...... :cool:

This is very true. It has caught me at an in betweeen time, though, because many good customers have NOT had an increase in REGULAR maintenance price in a few years. Here is what I posted on another thread, and it it is sort of a breakdown I am not looking to replace the full cost of fuel, just make up some difference, and then some. This will take me back to around the time that it was $1.40 something average.
My analysis is this. I use approx. 1 gal per hour running the mower (just under). An average 1/2 acre lot is .4 to .5 hrs. running time. This gives me 1/2 gal of gas (including trimmer). If I consider 1/8 to 1/4 gal. for the truck, this is 2.09 per stop (based on 2.79/gal.). Now, I am not meaning to re-charge for ALL my fuel expenses, BUT if I cut that cost in half (back to the likeness of spending 1.40/gal. I can live with this, and STILL come out ahead. So, I figure about $1.00 per stop will make a significant difference. Now, I COULD refigure this, and figure it at $3/gal., and that might even be a smarter thing to do. .75 (3/4 gal.) @ $3 = 2.25..divided by 2, = $1.12. So, we are STILL better of to justcharge $1. I think I'm going to do this. $1 does NOT sound like alot to the customer. This is not to mention that much can be made up on future pricing of other sidework.
Now, aNOTHER thing to consider guys, is that these fuel prices will ALSO AFFECT OUR OTHER OPERATING COSTS. This will go for higher parts prices, as well as other supplies, so we need to prepare for it.