Back to fuel surcharges

Discussion in 'Lawn Mowing' started by tiedeman, Nov 9, 2005.

  1. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    Ok, I posted a few questions on a fuel surcharge thread a couple of days ago yet nobody answered it, so I will try again?

    To those that charge fuel surcharges:

    1. How is it worded in your contract?

    2. How do you keep track of the fuel to charge the appropriate amount?

    3. Do you charge based on the daily, weekly, or monthly average or high?

    4. Also what happens if the fuel prices go up during the first part of the day, but then drop back down later in the day, do you still charge?
     
  2. LB1234

    LB1234 LawnSite Gold Member
    Posts: 3,210

    We do ranges for surcharges...

    2.25-2.50 is $3
    2.51-2.75 is $4
    etc.

    We basically word it so that its the price of gas for the week in which the lawn was serviced. We keep track by writing down the price of gas in which we filled up for those accounts. We also could dig out the receipts if need be cause gas is purchased through the company cc.

    We've been doing it for 2 years now...only for residentials, not commercial accounts. Honestly, not a single complaint. We haven't EVER got questioned about a single surcharge. I have to say the residential clients we have are pretty understanding.
     
  3. jpp

    jpp LawnSite Silver Member
    Posts: 2,128

    1.However, it appears record fuel prices are on the horizon. I have to prepare for this expected increase and I hope you understand. Due to impending high prices, if gas hits $2.25 per gallon, I must put a surcharge of $x.xx a month per property. This is how it was worded in my paperwork at the beginning of the year.

    2. It doesn't matter how much fuel I use. If gas is at 2.25 then they get the surcharge.

    3. It has been above 2.25 all season so I just put the surcharge on the bill each month. No questions or comments by the customers.

    4. Once the price is at the surcharge amount for the day or week it is put on their bill. Gas prices vary from one part of town to the other so that is why I just do the surcharge.

    JP
     
  4. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    ok, you say that you keep track of when you fill up for gas. But what happens when a customer is maintained on monday and gas is $2.89, but then on Tuesday gas is 2.49. Do you give the customer a break because of the days difference?
     
  5. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    I am just trying to figure out a ethical and proper way to charge a fuel surcharge properly. I didn't do it this year, but I am considering it. So I am just wondering and trying to figure out the proper way to do it without complaints or problems
     
  6. olderthandirt

    olderthandirt LawnSite Platinum Member
    from here
    Posts: 4,900

    #1 contractor has the option of adding a fuel surcharge to the cost of service if gas goes above $3.00 a gal
    The amount will be 5% at $3.00 a gallon up to $3.25 and 10% above $3.25 upto $3.75 gallon of gas.
    If fuel/gas should cost above $3.75 a gallon contractor will add an additional 1% for every 5ยข above $3.75
    IE $3.80 = 11% $3.85 = 12% $4.00 = 15%
    The price stated are above and beyond the stated cost per service price and will be based on a local monthly average
     
  7. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    I am just trying to figure out that when I bill I base it on daily, weekly, or monthly high or average?

    What do you guys think?
     
  8. jpp

    jpp LawnSite Silver Member
    Posts: 2,128

    I do mine weekly. If one week it is at 2.25 and the next it is at 2.05 then they will only get the charge for that 2.25 week.
     

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