Dear Customers

[Gene $immons]

Any comments or improvements on the wording??



Dear customers,


I have included a $5.00 fuel surcharge on this months invoice. As gas prices continue to climb higher and higher, I must pass along the added expense. Even with the surcharge, I am still taking a loss on my costs.

Please understand that this is a temporary fee. Once gas prices are lowered, I'll remove the fee.


Thank you.

[i_plant_art]

ha--

ya know everyone says charge more add a gas fee why....???? lets say you are working at the grocery, a dept store, homo cheapo, lowes, airport etc etc..... has anyone had thier boss come to them and say "hey billy since gas prices are going up we are going to give you an additional .20 per hour raise, but when they go back down we are taking it away from you." ????????? Naw.. it just dont happen like that, sure those stores and others are having to adjust thier prices....................some but not fully otherwise people wouldnt shop there right now.... why raise your prices? all its doing is cutting into your profit..... yeah i know thats wa big deal, no more cable tv, or eatting out for a while..... rough life huh...... thats what i did. no more satelite back to the rabbit ears, no more eatting out on the weekends for a while...... just change your lifestyle some youll figure out you really didnt need all the luxuries in life anyhow , and once your lifestyle is cut down some you will have more money in your pocket then compared to if you had raised prices...............

[Gene $immons]

thats true

but why should I have to make changes? Its not my fault gas prices are astronomical.

[Runner]

The wording is certainly not the best. "I must pass along the added expense"? Not tahat professional. I would try something different. Pasing it on sounds exactly like that...you are just passing it on,...like there is no consideration taken to do this. I'll give you one in a bit.

[i_plant_art]

nor is it your clients so why pass it off.....

lets says avg price to cut is $40.00

let say you have 100 yards and it costs you$200 per week in fuel for truck and mowers (lets says 80 gallons total of regular gas @ 2.50 a gallon= $200)( i know it would be more but for the simplicity sakes) thats $2.00 per yard in fiel costs.

Huricane comes gas goes up.....

now your fuel expense 3.60 a gallon still the same 80 gallons this would be a total of $288.00 a week for the same amount (80*3.60= 288.00)for the same 100 yards thats now 2.88 per yard a mere .88 per yard increase.

Ok now so yeah there are 4 weeks in a month assuming gas stayed at 3.60/gal thats $352.00 more a month.

Big whoop.... considering the high profits in mowing as they are......

100 clients @ 40.00 (the orig avg)= 4000.00/week in gross revenue or 16000 per month so why complain over a $352.00 monthly expense increase????

lets say u sent out a letter to each client explaining it b4 the invoice went out ok so now u have 100 clients plus .37 for each stamp ($37 for stamps) plus let make up .15 for an envelope and piece of paper .15*100 = $15 plus computer itme and envelope licking time say it costs you .07 for each one in time to lick and stuff. .07*100= 7.00
thats a total of $59 to let people know of the increase subtracted from the original 352 only leaves you with 293$ more dollars for your pocket

thats only 2.93 per client for the month that you would increae your profits.... not to mention out of that 100 say u lost a few clients b/c of it lets say 3 3/100 not too bad huh... yeah til you do the math............ now thats an additional $480 (3 clients@40 a cut for 4x a month) a month you would loose so now your actuall y making less gross not to mention instead of having that $288 a week cost split amoungst 100 clients its now only over 97 which now makes your per client gas costs go up to 2.96 instead of 2.88 so in reality if it happened this way and it is bound to when raising prices you always loose a few now ur actually making LESS with a fuel surchage than had u not raised prices in the first place......


SO... is it worth it??????????? or can you live without eatting out and cable t6v for another 6-10 weeks (depending on where in the US you live and mowing seasons)

[stumper1620]

Any comments or improvements on the wording??



Dear customers,


I have included a $5.00 fuel surcharge on this months invoice. As gas prices continue to climb higher and higher, I must pass along the added expense. Even with the surcharge, I am still taking a loss on my costs.

Please understand that this is a temporary fee. Once gas prices are lowered, I'll remove the fee.


Thank you.

I've tried to post this a bunch of times, this is my last try,

Here is a rough copy of my letter, I hope!

[Drew Gemma]

yeah but don't we have the right to earn are bottom line. I know we add to the problem buy raising prices but how much should we eat. Really Do you think other companies are just staying in there by taking a loss.

[i_plant_art]

since i originally made this post i think im goign to take my original $59 and send out letter indicating to my clients that there will be no need for a price increase that i am operating a stable lawn care business and can more than absorb the increase and also that if they hear of any of thier friends talking about how their lco has increased rates that if they will refer them (homeowner friend) to me and mention that i am not raising rates that i will send them a $30 gift card to any business of thier choice as my way of saying thank you. this way i will then have more income per month and be spreading out the gas costs over more lawns thus causing my cost per lawn to go down. yeah it willl take a little more gas but at 2.88 per yard (hypothetical) vs $40 more income its well worth the investment if i sign on a new client for the year.

[qualitylandscaping]

There is a god damn fuel surcharge on my NYSEG (NY STATE ELECTRIC & GAS) for them to drive here and friggen read my gas meter..

The cost of fuel will be passed along to the customers.. I'm not eating a penny of it..

[fullburn]

it's not a loss it's just a little less, for now think big picture in spring, more accounts because your the good guy times a rate increase, I think you will come out ahead in the long run.

[qualitylandscaping]

it's not a loss it's just a little less, for now think big picture in spring, more accounts because your the good guy times a rate increase, I think you will come out ahead in the long run.

Only if you can hack it long enough to make it to next spring

[i_plant_art]

There is a god damn fuel surcharge on my NYSEG (NY STATE ELECTRIC & GAS) for them to drive here and friggen read my gas meter..

The cost of fuel will be passed along to the customers.. I'm not eating a penny of it..



I guess God must be watching over you and sending you what you deserve with that kind of language. You will reap what you soe. SO so be it.

[stumper1620]

since i originally made this post i think im goign to take my original $59 and send out letter indicating to my clients that there will be no need for a price increase that i am operating a stable lawn care business and can more than absorb the increase and also that if they hear of any of thier friends talking about how their lco has increased rates that if they will refer them (homeowner friend) to me and mention that i am not raising rates that i will send them a $30 gift card to any business of thier choice as my way of saying thank you. this way i will then have more income per month and be spreading out the gas costs over more lawns thus causing my cost per lawn to go down. yeah it willl take a little more gas but at 2.88 per yard (hypothetical) vs $40 more income its well worth the investment if i sign on a new client for the year.
That is the intent of the letter I sent with yesterdays billing.
I think this could be a good boost to the business and I'm going after all I can get from it. :D payup

[Tvov]

I've tried to post this a bunch of times, this is my last try,

Here is a rough copy of my letter, I hope!

This may sound weird, but I try to avoid giving precise numbers as much as possible, especially in a form letter being sent to all customers. I always use "approximate", "percentage", etc. I don't like giving out any of my "cost of operations" numbers, some PITA customers might use those to haggle with me. In an individual letter sent directly to a customer I will give exact numbers (if that is required).

[Gene $immons]

Thanks.

Back to the original letter.... I am going to pass along the expense... Any suggestions on the wording of my letter..

Thanks

[CutApproved]

I didn't get a chance to read all what everyone has said. But here is my opinion.
In 2003 we were paying (approximately) $1.10/gallon
100 gallons/wk = $440.00 monthly fuel costs

In 2004 we paid $1.70/gallon
100 gallon/wk = $680.00 monthly fuel costs

And now were paying in excess of $2.50/gallon
100 gallons/wk = $1000.00 monthly fuel costs.

This is based on approximately 65 customers, (1 truck, coulple mowers etc.)
Take the difference between 2005 & 2003 and it comes to about $2.00 more per week per customer. So 4 cuts month that an $8.00 fuel surcharge.
Now keep something else in mind this is also based on the fact that none of these 65 customers have had a rate increase in over 4 or 5 years. Its not my business but a friends and I've been telling him for 2 years he should have raised his rates about 2$ or $3 dollars for each account maybe then he wouldn't have had to charge the surcharge.

A couple had stated owe whats the big deal a few hundred dollars more per week is not bad when your pulling in $16,000.00 per month.
Well everyone will soon be seeing the costs of bread,milk, all groceries going up to what you don't think we should pay more for milk. You have to just like your customers should have to pay more, "at this time", when the rates go down then the surcharge comes off.

KEEP IN MIND, EVERYONE IS IN A DIFFERENT SITUATION. If you rates on set where they should be then you shouldn't be charging a surcharge, BUT if your rates are rates from 5 years ago then you ought to be doing something.

JUST MY 2CENTS!!

[DUSTYCEDAR]

cut has a good point

quality is just mad at the elec company and he can be but guess what u need elec to post at ls so they got u and u have to pay

but the customer dont need the lawn cut by u and they know it and can find someone else if need be

should u raise prices yes i think so but within reason

it cost on average a 100 bucks to get a customer when u factor in adds phone time to do the estimate and all the other overhead
for some it may be cheaper but u get my point
if u lost 4 customers to the price hike and added the added cost to get 4 more did u make any more money? or lost some? just to feel better that u got the customer over a few bucks of gas.

[gqnine44]

I think some of you guys are too worried about passing along fuel costs. Upper class clients dont care about $5 a month or $2 a week or whatever. They expect you to charge them as it obvious that your expenses have increased somewhat unexpectedly since you gave the original estimate.

I have had fuel charges of one kind or another since gas was $1.50. There is a space on all of my invoices marked "fuel charges". I cant even imagine purposely eating this added expense.

However, if you decide not to raise prices you should send a letter (like you planned) this way people dont just think you are a stupid mower boy with no idea how to run a business and wonder why you never raised your price. You are on the right track explaining why.

But I say raise prices.

[Turf Troll]

I think stumper & i plant art are on target. I am going to spend $1300 to $1500 on Door hangers, newspaper and postcards in the next two weeks Probably sell 30-40 different type jobs. I sure would rather eat the extra in fuel for 13 to 15 more cuts left in this year. To get more referrals close together, referrals are always best.

[stumper1620]

This may sound weird, but I try to avoid giving precise numbers as much as possible, especially in a form letter being sent to all customers. I always use "approximate", "percentage", etc. I don't like giving out any of my "cost of operations" numbers, some PITA customers might use those to haggle with me. In an individual letter sent directly to a customer I will give exact numbers (if that is required).
I don't care about PITA's, many of my clients are business owners and with my fuel cost plus other cost means they are getting a very fair price. ( they will know that the miniute they see the cost I show them.)
remember referrals is what I'm after.
I cannot and will not increase my higher income properties and not the lower and some of my best clients cannot afford an increase or I will lose them for sure. I am not willing to lose any! I have a great client base and want to keep all I have.

[Tvov]

stumper, I was just pointing out about using exact numbers in a form letter.

:)

[qualitylandscaping]

cut has a good point

quality is just mad at the elec company and he can be but guess what u need elec to post at ls so they got u and u have to pay

but the customer dont need the lawn cut by u and they know it and can find someone else if need be

should u raise prices yes i think so but within reason

it cost on average a 100 bucks to get a customer when u factor in adds phone time to do the estimate and all the other overhead
for some it may be cheaper but u get my point
if u lost 4 customers to the price hike and added the added cost to get 4 more did u make any more money? or lost some? just to feel better that u got the customer over a few bucks of gas.

I'm not mad at the electric company just saying everyone and their brother that is in business is adding a fuel surcharge.. Why would anyone in their right mind, tell us to not raise our prices.. If I get charged fuel surcharges on my deliveries for my customers, my electric so I can write my invoices for my customers, my groceries because trucking costs more.... I'm passing it along to my customers.. This, we are making enough and don't need to charge more BS NEEDS to end..

[GarPA]

you might want to consider adding a phrase like we have in our maintenance agreements..." we derive no revenue or profit from any monthly fuel surcharges". In our case, that is true. Our surcharge kicked in once gas went above 2.10 per galon and this "trigger" is noted in the annual maintenance agreement. We know exactly how many gallons we use per month and allocate the total gallons used per customer per month.

We have never had a customer complain about the surcharge nor have we lost any because of it. While fuel costs are a relatively small % of total cost of operations, I have no intention of eating the increased costs. Market pressure has made mowing prices low enough as it is

[Gene $immons]

Thanks GarPA, That was what I was looking for.

Another point.

It's not only the fuel that is used while the customers lawn is being worked on, It's that I have trucks running all over town servicing lawns.

I think some of you need basic business economics 101. Why would you not pass along the added expense? I have a small greenhouse which I store my seasonal flowers in until I plant them. The trucking company which made a delivery on Thursday added a 20% fuel surcharge to my bill. I guess I should cut back on eating out huh.

[thecolorgreen]

[QUOTE=i_plant_art]ha--

ya know everyone says charge more add a gas fee why....???? lets say you are working at the grocery, a dept store, homo cheapo, lowes, airport etc etc..... has anyone had thier boss come to them and say "hey billy since gas prices are going up we are going to give you an additional .20 per hour raise, but when they go back down we are taking it away from you." ????????? Naw.. it just dont happen like that, sure those stores and others are having to adjust thier prices....................some but not fully otherwise people wouldnt shop there right now.... why raise your prices? all its doing is cutting into your profit.....

The big difference is that senerio is about an EMPLOYEE and YOU are a BUSINESS! Or are you simply your customers employee?