BEWARE Charging for extra fuel !!

Ron Musgraves

Ron Musgraves

Exterior Restoration Specialist
Staff member
BEWARE Charging for extra fuel !!

Recently my best friend who has a few hundred employees got popped by a builder in a lawsuit.

Like everyone charging additional for fuel is becoming standard practice.
Like everyone we all know that most people are doing it.
Here is his story and I remember the details well because he called me and asked what I was doing. I told him we are just raising prices as needed.
He was how are you doing that, you have contract agreement for X dollars. I informed anyone new was paying higher prices to offset this problem from getting worse in the future. I’m not planning on gas coming down like everyone else. Its here to stay high and may go higher.

We talked some more and his dilemma was he could raise the contract so he implemented a sir-charge on every delivery of tile to the builder and one on every service truck.
This was working great and they where paying the additional invoices like clock work.
SO, the end of the contract was nearing and they began to slow pay. His accounting is large so he was not right on top of things himself until one of the gals in the office said for the last month alls they have paid are these fuel surcharge invoices.
About a week later the builder sends final payment, it’s and invoice for over charges according to original agreement.
They paid the fuel all the way thru and in the end he received a bill for around 200.00, they back charged every bill at the end of the contract.
The lawyer said he was not the first guy and probably won’t be the last.
My friend wants to continue do business with the company so he not going to contest the back charges. He also was told he would probably not win.

The reason why was he has no fuel clauses in the agreement about fuel increasing and affecting the terms of there agreement.

Guys if your on maintenance contracts you need these words in your agreement. Each state will differ, so you need to find this out on your own.

One time jobs I would not worry about, fuels is not coming

Just thought I would share that. This thread made me do it. Reminded me anyway.
 
I did add a sir-charge on my accounts, but I had a meeting with my customers first and we talked about it and they wanted me to right it up as a sir charge until they redo their yearly contracts this fall, then I'm putting it in as a raise instead. But I think I'm ok because we had a meeting and wrote it up as they wanted it so I could get by until around Sept or October when they redo Budgets.
 
TLC Sweeping & Maint said:
I did add a sir-charge on my accounts, but I had a meeting with my customers first and we talked about it and they wanted me to right it up as a sir charge until they redo their yearly contracts this fall, then I'm putting it in as a raise instead. But I think I'm ok because we had a meeting and wrote it up as they wanted it so I could get by until around Sept or October when they redo Budgets.
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Great move,communication is alway great. resonable business partners understand the circumstances. Good Post!
 
We added a clause similar to this: If prices on diesel raise above $4.00 a gallon from the nearest National Brand Gas Station, we will charge $700 per job and and for every .50 above $ 4.00, we are able to charge and extra $500. ( .50 a gallon higher, $500 added to the bill.)

We started wording our contracts this way back in March 2006 when Diesel / gas was around $2.89 a gallon.
 
They do understand what I'm going through right now because they are going through it too with their Maintenance Trucks. I'm the only one so far that has had a meeting with them, they said that other venders just added a sir charge to their monthly billing and they thanked me for setting up a meeting to let them know what I was doing first, instead of just raising the bill.

I think communication is very important and keeping an open line with them, this way they feel like they are not being left out of the loop and if there are any problems, we can talk about the issuses and work them out before there is a problem. So far this has worked well for Me.
 
Jim@Garagecleaning said:
We added a clause similar to this: If prices on diesel raise above $4.00 a gallon from the nearest National Brand Gas Station, we will charge $700 per job and and for every .50 above $ 4.00, we are able to charge and extra $500. ( .50 a gallon higher, $500 added to the bill.)

We started wording our contracts this way back in March 2006 when Diesel / gas was around $2.89 a gallon.
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What kind of job are you doing where you spend 700.00 in fuel much less an extra 700.00 in fuel?
 
pressurepros said:
If thats the case UPS owes me about $10,000.
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UPS is a transportation company and pays federal and state hWy taxes.

They are allowed by your agreement and federal laws.

Keep in mind you can try to charge this, it would need to be in your agreement.

Be carefull
 
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