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View Full Version : Anyone charging a Fuel Surcharge Yet?


RBatten
04-21-2011, 08:12 PM
Gas is quickly approaching $4 and diesel is already over $4, so has anyone implemented a Fuel Surcharge? If so what did you charge and how did it go over with the customers?

Thanks:confused:

KINGMADE
04-21-2011, 08:34 PM
Not yet but it gas hits 4 I will implement an 8% fuel surcharge. I think it will go over fine for the most part.

ashgrove landscaping
04-21-2011, 08:38 PM
I'm paying $4.10 at the moment and it's onl going up so yes the fuel surcharge and extra time charge is in full effect. $45.00 to fill the Z.

KINGMADE
04-21-2011, 08:42 PM
I'm paying $4.10 at the moment and it's onl going up so yes the fuel surcharge and extra time charge is in full effect. $45.00 to fill the Z.

We are down around 3.72 for the cheap stuff.

br549oicu8
04-21-2011, 08:50 PM
We charge $2 per mowing stop. I've been doing this ever since gas hit $2.50. Not one complaint.

lukemelo216
04-21-2011, 08:53 PM
Yes, i made the decision today to implement a fuel surcharge on all work besides seasonal contracts. Those will remain in tact at the agreed upon rate, but we will no be using a 4% fuel surcharge for all mowing customers. All landscape work will have a smaller charge worked into the bid.

I think it will go over just fine. Figure on a $30.00 per week account, thats $120.00 per month, adding in 4% for fuel will be there bill will be an extra $5.

I dont have it in my contract or anything, however; i will send out a letter explaining this additional surcharge. And I wil also explain that it will go down when gas goes below $3.75 (as that is what I budgeted fuel at for the year). I was eating the additional .15-.24 per gal I was paying but with mowign getting ready to ramp up i cant.

jsslawncare
04-21-2011, 08:53 PM
No, I just went up on my prices. No one complained. $5.00 increase.

yardguy28
04-21-2011, 08:53 PM
not using the fuel charge yet but soon will be.

it is going to go over fine with my clients. they are already aware of it. they like it because it keeps me from raising prices. and if gas would not hit the $4 a gallon mark or as soon as it would go under $4 a gallon again no fuel charge.

but for me it has to stay $4 a gallon for 2 weeks or more out of the month for me to use the fuel charge. otherwise i'm not gonna bother.

Dr.NewEarth
04-21-2011, 09:16 PM
In Vancouver, B.C. our gas works out to about $5.55 a gallon.

We pump and pay by the litre(quart)

We really took a beating the last time gas went really high a few years ago.

For the past two years I have had it written in our contract that "if gas goes above
$1.30 per litre, then we will charge 3% on the gross before taxes." Today it's $1.38/litre

Gas went above $1.30 back in February. We pay alot for taxes here.
That's one way we are paying for the Olympics that we had.

I just got paid from one HOA and their manager deducted the gas levy from the bill.
There was no explantion or even a note with the cheque.

I talked to the HOA President, and he said they never approved the manager taking money off of our bill.

So, now I am in a dispute with the manager. I have been operating for 15 years.
I don't like dealing with many of the property managers out there!

I wrote about this in the general landscaping forum a couple days ago.

I hope I can resolve this problem.

Maybe I can run my equipment on my indigestion.

watatrp
04-21-2011, 09:47 PM
I sent out letters for the season in late February stating that prices for this year were based on $3.50 per gallon. Anything above $3.50 results in a fuel surcharge. I don't have a set amount but just a weekly surcharge that covers just the increase in cost due to fuel only. Example-if I use 3 gallons of fuel to service a customer and gas is $4.00 a gallon, the difference between the prices is 50 cents per gallon. The customer gets a $1.50 fuel surcharge for that week.

goodgreen
04-21-2011, 10:11 PM
I sent out a message with my renewals this year that if gas hit $4 there would be a surcharge added. If it goes back down I'll remove it again.

RBatten
04-21-2011, 10:18 PM
Thanks for all the feedback. I was thinking of just adding a $5-$10 fuel charge to the bills. I don't want to do the % thing as some of my customers have larger amounts of detail work which doesn't consume large amounts of fuel. They are paying for extra time. I wrote a letter a couple of months ago but didn't mail it out. I think I will include the letter this month and implement the sur charge next month. I know a couple of years ago when gas was $4.25 it hurt real bad and I don't want to go through that again.

Get Some...
04-21-2011, 11:15 PM
No.
No plan's to raise any price's....

justgeorge
04-22-2011, 12:28 AM
I sent out letters for the season in late February stating that prices for this year were based on $3.50 per gallon. Anything above $3.50 results in a fuel surcharge. I don't have a set amount but just a weekly surcharge that covers just the increase in cost due to fuel only. Example-if I use 3 gallons of fuel to service a customer and gas is $4.00 a gallon, the difference between the prices is 50 cents per gallon. The customer gets a $1.50 fuel surcharge for that week.

How big a lot is it that's taking 3 gallons of gas? I thought about a gas surcharge but even the price difference of $2/gallon vs $4/gallon the amount of gas in the mower per mow is next to nothing. Fortunately I have a very tight route so gas in my truck in next to nothing also.

Dr.NewEarth
04-22-2011, 01:23 AM
Your gas surcharge should reflect the increase in costs as it effects all of your
business requirements.

Think about it. Include gas for your vehicle, the increased cost of all of your supplies your insurance increase and more. Focus on your big picture, not just a mower.

The trucking company that brings in the fertilizer you use is charging more for shipping, The fertilizer is more expensive. The stores won't take a loss.

Although I love long term contracts....Some-times I think that it's unfortunate that we have to get locked into agreements for long periods of time, with no safety net.

Clients and their agents do break agreements

RLS24
04-22-2011, 01:47 AM
I sent out a message with my renewals this year that if gas hit $4 there would be a surcharge added. If it goes back down I'll remove it again.

I did the exact same thing. Not one complaint. Mine is 8% or something, it works out to like $2.00 on a $25 lawn. Just gotta be careful how you word it in your contract. Mine says "If fuel reaches or exceeds $4.00 per gallon FROM OUR SUPPLIER....." that kinda weeds out the the people who would say "well so and so has it for $3.99..."

watatrp
04-22-2011, 07:25 AM
How big a lot is it that's taking 3 gallons of gas? I thought about a gas surcharge but even the price difference of $2/gallon vs $4/gallon the amount of gas in the mower per mow is next to nothing. Fortunately I have a very tight route so gas in my truck in next to nothing also.

I include the cost of driving to the customer's property also plus it is a 2 acre property.

yardguy28
04-22-2011, 07:28 AM
I sent out letters for the season in late February stating that prices for this year were based on $3.50 per gallon. Anything above $3.50 results in a fuel surcharge. I don't have a set amount but just a weekly surcharge that covers just the increase in cost due to fuel only. Example-if I use 3 gallons of fuel to service a customer and gas is $4.00 a gallon, the difference between the prices is 50 cents per gallon. The customer gets a $1.50 fuel surcharge for that week.

wow no wonder my clients love me.

my fuel surcharge is only $2 for the entire month.

i've found other ways to save money/cut costs. mostly i'm just willing to eat a little bit of the extra expenses.

watatrp
04-22-2011, 07:35 AM
wow no wonder my clients love me.

my fuel surcharge is only $2 for the entire month.

i've found other ways to save money/cut costs. mostly i'm just willing to eat a little bit of the extra expenses.

I could probably eat the increased cost of fuel too but it's kind of an open ended deal with the way prices are going up. I do try to group my routes so that the increase in cost to drive my truck is shared. I didn't have a price increase this year for cuts so the only increase my customers see is for fuel usage above $3.50 a gallon.

AI Inc
04-22-2011, 07:37 AM
Almost everyone could eat it. but why should you? Did your customers take a pay cut?

yardguy28
04-22-2011, 08:02 AM
I could probably eat the increased cost of fuel too but it's kind of an open ended deal with the way prices are going up. I do try to group my routes so that the increase in cost to drive my truck is shared. I didn't have a price increase this year for cuts so the only increase my customers see is for fuel usage above $3.50 a gallon.

same here. the only increase that i need to make adjustments for this season is the actual cost i pay at the pump per gallon. thats why chose a fuel charge instead of raising prices. if fuel doesn't reach the $4 a gallon mark or eventually falls back below that the fuel charge will disappear.

Almost everyone could eat it. but why should you? Did your customers take a pay cut?

i have sympathy for my clients and my number 1 reason for doing this business is not the profit.

everything is going up for everyone. some people have lost there jobs or had there hours cut. others are on fixed incomes.

if you have read the other price raising/fuel charge threads you'd notice that i'm willing to cut back my spending on say going out to eat, to the movies, to the bar, entertainment wants to have the extra money to eat the cost of fuel or at least some of it.

america as whole has had to cut back on spending. people are cutting out the luxuries in life. so why should we expect to still have those luxuries? as i've said before if you are struggling to afford the needs (heat, water, etc.) in life then yes raise prices.

but i personally will not raise prices just because i find myself not being able to go out to eat as much or go the movies as often. i won't be raising prices so i can get that motorcycle i've always wanted or have that pool put in my back yard.

we don't need to debate it because it's been debated to much already. but i personally take care of my needs and thats my concern. if i need to cut back on my wants, thats something i personally am willing to do. i go out to eat less, i don't go to the bar as often.

RBatten
04-22-2011, 08:06 AM
Almost everyone could eat it. but why should you? Did your customers take a pay cut?

Exactly. I could eat the difference but that would come straight off the bottom line. If you are running a business and not working on the truck you as the owner are the last one to get paid. I am the last one to get paid and I personally would be the one paying for the added costs. That is what I did two years ago and it wasn't fun. Fuel was up more than 40% and my pay was down the same amount. I am not going to work for free or for less than what I pay the crew guys. I have to make sure there is money in the bank for unexpected expenses, fund projects, and the many other items that are unbudgeted.

rreyn1812
04-22-2011, 09:05 AM
We charge $2 per mowing stop. I've been doing this ever since gas hit $2.50. Not one complaint.

I've been doing the same, with the same results (no complaints), but I also told my customers that when it goes over $4/gal, then I will add another $1 per mowing.

krackerjack9
04-22-2011, 10:58 AM
Right now at the company I work for were adding $100 per truck anything over 40 miles and $55.00 per hour standby time. we got a job coming up and the fuel charge is going to be right at $200.00 per truck. but they want to build a house about 80miles in the middle of no where. And from the main road its another 12 miles down a ranch road to the site.

GreenscapesWV
04-22-2011, 01:44 PM
when gas went over $2.89 i added $5.00 to each lawn, now that gas exceeded $4.00 for reg unleaded i am starting to add a fuel surccharge of $1.50 per stop. went up on my mulch from 90 per yd installed to $95 installed. Also went up on hourly rate from $50 to $52. Also switched trucks went from 9mpg 6.9 chevy 2500 hd to 5.7 5 speed 1500 hd at 13 mpg. so overall im making more money than when gas was $2.99 per gal

yardguy28
04-22-2011, 01:54 PM
Exactly. I could eat the difference but that would come straight off the bottom line. If you are running a business and not working on the truck you as the owner are the last one to get paid. I am the last one to get paid and I personally would be the one paying for the added costs. That is what I did two years ago and it wasn't fun. Fuel was up more than 40% and my pay was down the same amount. I am not going to work for free or for less than what I pay the crew guys. I have to make sure there is money in the bank for unexpected expenses, fund projects, and the many other items that are unbudgeted.

i'm actually the only one to get paid. i'm a solo operation. and i rarely pay myself in the first place. everything i get from clients goes straight into the business accounts.

Florida Gardener
04-22-2011, 04:30 PM
same here. the only increase that i need to make adjustments for this season is the actual cost i pay at the pump per gallon. thats why chose a fuel charge instead of raising prices. if fuel doesn't reach the $4 a gallon mark or eventually falls back below that the fuel charge will disappear.



i have sympathy for my clients and my number 1 reason for doing this business is not the profit.

everything is going up for everyone. some people have lost there jobs or had there hours cut. others are on fixed incomes.

if you have read the other price raising/fuel charge threads you'd notice that i'm willing to cut back my spending on say going out to eat, to the movies, to the bar, entertainment wants to have the extra money to eat the cost of fuel or at least some of it.

america as whole has had to cut back on spending. people are cutting out the luxuries in life. so why should we expect to still have those luxuries? as i've said before if you are struggling to afford the needs (heat, water, etc.) in life then yes raise prices.

but i personally will not raise prices just because i find myself not being able to go out to eat as much or go the movies as often. i won't be raising prices so i can get that motorcycle i've always wanted or have that pool put in my back yard.

we don't need to debate it because it's been debated to much already. but i personally take care of my needs and thats my concern. if i need to cut back on my wants, thats something i personally am willing to do. i go out to eat less, i don't go to the bar as often.

Yardguy

Like I said before, if people cant affored a luxury service like lawn care, they should buy a mower and do it themselves. A few extra bucks will not make a difference if they can actually afford it.

Yes, you are a solo, but guys who have employees are the last to see $$. I agree with some of the stuff you say, but you have to understand there is the other side of the coin which is a company with employees and not a solo.....

rcslawncare
04-22-2011, 06:29 PM
Iv increased by prices a little each year so I dont have to do and tack on extra prices to my bid. It accounts for $4.75 a gallon, so hopefully it wont go over $5.00 this year or everybody will be hurting.

yardguy28
04-22-2011, 07:46 PM
Yardguy

Like I said before, if people cant affored a luxury service like lawn care, they should buy a mower and do it themselves. A few extra bucks will not make a difference if they can actually afford it.

Yes, you are a solo, but guys who have employees are the last to see $$. I agree with some of the stuff you say, but you have to understand there is the other side of the coin which is a company with employees and not a solo.....

and what makes you think i don't see the other side of the coin?

i've been trying as of lately to make sure what i'm putting down is my opinion and sometimes what applies to my situation.

although this goes for solo and guys with crews a like. i think to many think nothing of raising prices. maybe it works for them and thats great. but no matter how large i get. i plan to only raise prices as a last resort.

yes to some lawn care is a luxury and if you can't afford it get a mower and do it yourself. but not everyone who has a lawn service is using it as a luxury service.

what do you say about all those disabled and all those senior citizens who can't physically do it themselves? thats about 90% of my business. people who are on fixed incomes. people who's cost of living is going up in every way, shape and form, but the amount they are taking in remains the same. for those people a couple bucks does matter when everything is going up a couple bucks.

a couple bucks per mow means $8 a month, thats $72 (assuming 9 months of mowings) a year.

i see where most are coming from when they raise prices. but like i said, i feel to many have the casual attitude that raising prices is just part of the business and it's what you do. some also have the attitude that you can't be running a successfull business if your not raising prices every so often.

i'm not sure who started the argument in the first place. i know all i ever said was that i'm not raising prices. i've decided to cut out some of my entertainment wants to tighten up my budget. meaning i need less to live off of. by now everyone knows i don't mind giving up the bars, movies or going out to eat to keep from raising prices. and i'm not saying everyone should be this way. it would be nice, but to each there own.

Clark Griswold
04-22-2011, 07:54 PM
We pay alot for taxes here

In order to pay for your FREE health care!

nobagger
04-22-2011, 08:01 PM
Gas is quickly approaching $4 and diesel is already over $4, so has anyone implemented a Fuel Surcharge? If so what did you charge and how did it go over with the customers?

Thanks:confused:

We sent out a letter with all our renewals and 3.85/ gallon was our trigger to raise rates a bit. We haven't mowed one lawn yet and today it went to 3.89/ gallon. I just heard on the national news....$6.00/gallon is a real possibility and more like a probability. I hate govt. and all the oil tycoon's. I hope they all rot in Hell!

lawnboy dan
04-23-2011, 09:49 AM
you guys who make the customer sighn a contract should have to just eat the gas price increase-

Woody82986
04-23-2011, 11:45 AM
I'm not charging any type of fuel surcharge this year. I didn't lower my prices when gas dipped down to $1.95 a few years ago, and I'm not going to add a fuel surcharge when gas hits $4.00 a gallon. Everyone got a small price increase at the beginning of the season that reflected what I figured to be a rise in gas prices over the course of the year. Now I will say that any new clients I agree to service with are getting a higher rate now than what I was charging at the beginning of the season. My rates on all services for new clients have gone up. I simply anticipate and prepare before the season starts so that my clients don't have to deal with a "fuel surcharge" adding weight to their monthly invoice. I'm not knocking anyone who institutes a fuel surcharge. I have in the past. But I just learned to anticipate the rise and plan for it in clients' every day pricing.

sunny days 101
04-23-2011, 01:45 PM
not using the fuel charge yet but soon will be.

it is going to go over fine with my clients. they are already aware of it. they like it because it keeps me from raising prices. and if gas would not hit the $4 a gallon mark or as soon as it would go under $4 a gallon again no fuel charge.

but for me it has to stay $4 a gallon for 2 weeks or more out of the month for me to use the fuel charge. otherwise i'm not gonna bother.

I like your idea; but what if the gas goes up to $5 or $5.50? Maybe on your letter that is going out to customers it needs to say a higher percentage if $5-$6 for more than 2 wks during that month?

It's kinda amazing that these customers dont care though---with low ballers out there working for rates that compete with the neighbor boy!! I had one guy that I obtained from a buy out and he was paying $25; and it was a small yard and we had the one across the street so two can be done at the same time....I told him since we had the one across the street we could keep the price the same...he says "well if you got the one across the street then why cant I pay $20 instead?" I told him "because I am not the neighbor kid mowing your lawn...I am rolling up with $40,000 in equipment". I dont care if that sounds rude--he was rude. In my mind I said I wouldnt be back to do it--but talked to his wife and she is nice--and apologized for her husband. (he was trying to get my spring clean up price chopped in half when she already agreed to it and work was done)

yardguy28
04-24-2011, 02:07 PM
I like your idea; but what if the gas goes up to $5 or $5.50? Maybe on your letter that is going out to customers it needs to say a higher percentage if $5-$6 for more than 2 wks during that month?

It's kinda amazing that these customers dont care though---with low ballers out there working for rates that compete with the neighbor boy!! I had one guy that I obtained from a buy out and he was paying $25; and it was a small yard and we had the one across the street so two can be done at the same time....I told him since we had the one across the street we could keep the price the same...he says "well if you got the one across the street then why cant I pay $20 instead?" I told him "because I am not the neighbor kid mowing your lawn...I am rolling up with $40,000 in equipment". I dont care if that sounds rude--he was rude. In my mind I said I wouldnt be back to do it--but talked to his wife and she is nice--and apologized for her husband. (he was trying to get my spring clean up price chopped in half when she already agreed to it and work was done)

well for now any price of gas $4 a gallon or higher will include a $2 a month fuel charge on it. it might have to be adjusted next season or purhaps prices will have to be raised next season depending on what the "new low" will be for gas prices.

when i have 2 people what want my services that live next to each other or across the street from each other i always tell them i'll do for X amount each since you both live by each other but normally it would cost Y. the X amount is always cheaper than the Y amount.

i had 2 corner lots across from each other that would normally go for $27 a piece and i told them that, but told them if they both hired me i'd do them for $25 a piece since it's a one stop deal.

Darryl G
04-24-2011, 02:36 PM
Instead of a fuel surcharge I just quit drinking instead and now I have my customers pay me in gasoline instead of beer. :walking:

rain man
04-24-2011, 08:48 PM
And the price of gas continues to climb. Where she stops nobody knows.