How to charge for fuel surcharge?

Discussion in 'Freight Broker Forum' started by PE_T, Jun 26, 2018.

  1. PE_T

    PE_T Road Train Member

    How do you determine the “base fuel cost”? I saw a forum from 2014 using $1.25. Also, once you calculate the fuel surcharge, do you just tell the broker that you will need a fuel surcharge of, say, $0.49 per mile? How do you phrase it?
     
  2. Truckers Report Jobs

    Trucking Jobs in 30 seconds

    Every month 400 people find a job with the help of TruckersReport.

  3. tnevin225

    tnevin225 Road Train Member

    1,166
    1,600
    Jan 1, 2014
    0
    You don't charge a fuel surcharge. That's for trucks on a contract. Your rate with a broker in general won't have a fuel surcharge just a straight up rate.
     
    Humblepie and PE_T Thank this.
  4. kw550cat

    kw550cat Medium Load Member

    663
    596
    May 22, 2012
    brooklyn, new york
    0
    As per above
    Unless it’s contract freight, there really isn’t fuel surcharge in the spot market. It is built in to the rate. So when you quote load, just add the fuel surcharge to it which will give you more negotiation room
     
    PE_T Thanks this.
  5. gekko1323

    gekko1323 Road Train Member

    1,305
    2,165
    Jul 14, 2018
    Henderson, NV
    0
    Yeah but doesn't the broker get the fuel charge from the shipper? Because I'll see on the DAT rate sheet that an average rate for a particular lane might be $2.10, NOT INCLUDING FUEL SURCHARGE. So if the broker posts this load at $1.90 let's say, what happens to the fuel charge?
     
  6. PE_T

    PE_T Road Train Member

    It would be interesting to know how exactly the broker and shipper negotiate with one another. Does the shipper tell the broker I need to move this load for $3000, then the broker finds a carrier to haul it for over $3000 to make a profit? Who knows.
     
  7. PPDCT

    PPDCT Road Train Member

    1,798
    5,555
    Jun 15, 2017
    St. Paul, MN
    0
    99% of the time, my customers ask me for a rate, and I give them an all-inclusive rate. If it works for them, they tell me to start looking for a truck.
     
    bacoman, Scooter Jones and PE_T Thank this.
  8. Midwest Trucker

    Midwest Trucker Road Train Member

    5,768
    20,578
    Aug 31, 2018
    0
    Lots of different ways. Usually depends on how big they are and how many loads per week or month they move.

    1. You bid on a contract for a years length and you price the line haul, knowing how much their fsc pays on top. All companies have their own fsc charts but they all are based on the national average of the price of diesel.

    2. You price the line haul knowing what the fsc is but as part of an ongoing bidding system. If your the lowest you get offered first, if your the highest you get offered last.

    3. You give your customer flat rates for each lane and update the prices from time to time to try and stay competitive so others don’t come in and earn the business.

    4. Customer emails and needs something moved. You quote it flat rate and they say yes or no.

    Number 1 is normally the massive companies and my least favorite. You can lose your rest if your not careful or risk losing the customer. I’ve known brokerages who were losing a couple hundred per load on certain lanes in order to not lose the customer as a whole. No way to do business IMO but happens everyday.

    Number 2 normally is large customers but maybe 1 location that ships hundreds of loads vs multiple locations that ships thousands. It’s an ok system but can be annoying as it’s hard to get into a rythem with carriers because your not consistently getting the freight. If your the cheapest and get it every time no carrier is going to consistently want to haul it anyway.

    Number 3 is normally smaller shippers but still ship quite a few loads. Maybe dozens vs hundreds. This is my favorite and where loyalty and trust is there and counts between each party. Less about dollars and cents but more about service.

    Number 4 is normally small shippers or shippers that expedite a lot and don’t have any rhyme or reason to when it needs to go. It just does and you better get it moved and not mess up. Normally they have a handful of people they email and the person who gets it covered first and for a semi reasonable price wins.

    That’s been my experience. I don’t even attempt to work with the 1’s anymore. The 2’s we have a couple but don’t focus to heavy on. The 3’s and 4’s I love and our all our energy into those.
     
  9. PPDCT

    PPDCT Road Train Member

    1,798
    5,555
    Jun 15, 2017
    St. Paul, MN
    0
    Your 3 and 4 situations are my bread and butter. I even have a few 5s, wherein it's- "Hey PPDCT, find me a truck." "Okay, I'll let you know what the rate is." And then I find a truck, they give me their rate, I give my customer the rate, and boom - it's done.
     
    Dino soar, Ruthless, TallJoe and 2 others Thank this.
  10. Midwest Trucker

    Midwest Trucker Road Train Member

    5,768
    20,578
    Aug 31, 2018
    0
    Ahh yes the 5’s! Haha. Nice.

    Only time I get those is when the 3’s Have messed up and their customer is upset. Get it there yesterday type of thing.
     
    Humblepie and PPDCT Thank this.
  • Truckers Report Jobs

    Trucking Jobs in 30 seconds

    Every month 400 people find a job with the help of TruckersReport.