fuel surcharge

[pballer]

What is the formula for figuring a surcharge? Is there a website?

[bayou hotshot]

This is the one i use i made a copy and give to all my customers so i do a base charge + surcharge

On the minifloats i get $2.50 a mile and the fuel surcharge is 34% thats $.85 add it up you get $3.35 a mile

A run i did today was 460 miles (minifloat) $1,150 fuel surcharge was $391 the run paid $1,541

http://www.rollrock.com/Fuel.htm

hope this helps

[pballer]

let me try it this way. this is just an example..... i pull a single trailer, would it make sense to say the base rate is 1.03 and the surcharge is .52 per mile additional? the reason I say .52 it was on some site i saw today. giving me a per mile charge of 1.55. or say i get 2.50 a mile, but .52 of that is the surcharge, so 1.98 base plus the charge. would that seem fair or a good and legit way to show it on paper? I have a new way of figuring insurance premiums is why i ask this....

[cosgo]

I never saw a need for a fuel surcharge. diesel goes up, i send a bigger bill. Why would you want to lock yourself down to a single base rate? How would a single base rate work? you cant charge the same base rate per mile for a 100 mile trip as a 1000 mile trip? Just curious. I hear about fuel surcharge all the time, but never understood it.

[pballer]

i can charge the same base rate in most cases, although i have a minimum charge, ex. 10 miles or 100 miles they pay the same, but over that i charge a per mile charge. my insurance is done totally different now, so my rate is what most rv transporters charge that includes their freight rate. like their base is 1.00 per mile and surcharge is .40 per mile so they would charge 1.40 total where my bill would be 1.40 flat rate, not broken down.

[bayou hotshot]

Diesel will never be under $1.00 a gallon so thats why im not worried about a single base rate if diesel was $1.00 a gal i could run cheaper i didnt do a fuel surcharge for a long time but what i ran into is when people call to get a price most tell them the charge with out a fuel surcharge so ware i was telling people $3.00 a mile someone else was saying $2.50 a mile and was geting the work than thay would get the bill with a fuel surcharge added to the bill

Its really a number game and most customers understand fuel is 25-50% of the rate most of my customers pass the surcharge onto the customer thats geting the shipment and thay eat the base rate. Also its easer for the customer to know what the rate will be insted of having to call you everytime thay need a quote i use to have to make a new price sheet every week now i dont fuel goes up so does the surcharge and i can cover the extra $$. I tell people all the time if fuel was $1.00 a gal the freight would get moved for $2.50 a mile

What ever you use you will just have to stick with it im not sure what you get now but what ever you have to have to run start there CPM + salary + profit than you have a base charge nomatter what fuel does your going to cover all that with a base charge all thats left is a surcharge to cover your fuel

[RVtransporter]

let me try it this way. this is just an example..... i pull a single trailer, would it make sense to say the base rate is 1.03 and the surcharge is .52 per mile additional? the reason I say .52 it was on some site i saw today. giving me a per mile charge of 1.55. or say i get 2.50 a mile, but .52 of that is the surcharge, so 1.98 base plus the charge. would that seem fair or a good and legit way to show it on paper? I have a new way of figuring insurance premiums is why i ask this....

I had insurance that changed to charging on revenue instead of miles and I did the same thing so my revenue was more 'true' to form - so I wasn't paying insurance based on whatever the fuel costs were.

I set my base and assumed (similar to Bayou's comment) that fuel wouldn't ever get to "X" (it was $1.25).

I then took my average fuel mileage (for example, 8 mpg with the big truck), and for every $0.08 in fuel, I go up $0.01 in f/s (any time there's a fraction, always round down on mpg and up on f/s).

Also - if you're averaging 14 mpg - you would go $0.01 in f/s for every $0.14 increase in fuel at the pump. If you get 15 mpg, $0.01 for every $0.15.... etc.

(note: for rv haulers that deadhead home, you need to cut the fuel difference in half so it would be $0.01 for every $0.07 increase in fuel at the pump)

Example with fuel at $3.50 and again at $3.60

$3.50 - $1.25 (my base) = $2.25 / 8 mpg = 28.125 = f/s of $0.29
$3.60 - $1.25 (my base) = $2.35 / 8 mpg = 29.375 = f/s of $0.30

If I had regulars that wanted the schedule, I would start at a low pump price and set the f/s, then just list each increment. In my case above, the increment would be +$0.08 in fuel = +$0.01 in f/s.

Like:
$2.30 - $2.37 = $0.14
$2.38 - $2.45 = $0.15
$2.46 - $2.53 = $0.16
(always to the math on the higher number so you get the benefit at the lower end of the range)

This seemed to work out well (I actually was getting 9 mpg but calc'd it at 8 for deadhead miles... etc)

The calculation to prove it out would be:
$2.53 pump price less $1.25 base price = $1.28 / 8 mpg = $0.16

Seemed to work without a problem.

[pballer]

Thanks. That is exactly what I was going for.