How to Figure Fuel Surcharge?

[Papa Rick]

Is this the correct way to do this: Say you get paid 1.00 a mile and Fuel is 3.299 according to: Natural stone veneer for homes, patios, and landscape the FSC is 32.25%. Would I take the 32.25% and multiply it by 3.299 to get the FSC which would be .3386 added onto the 1.00 mile so total pay would be 1.3386 per mile? Never tried to figure FSC so this is the reason for the question.

Thanks

[Bigmon]

I come up with $1.06. (32.25 x 3.299 ) so the haul would be $2.06 per mile.

[Steel Horse Cowboy]

I have a paper showing our FSC based on the current fuel prices. I will post it and you can go from there..... we pay $1.25 for fuel supposedly and our FSC makes up for the higher cost as it goes.

[Papa Rick]

Steel Horse Cowboy, did you post this paper yet? If so I did not see it.

[Papa Rick]

So is the correct way then? 32.35 X 3.299 = 1.07 (1.0672 rounded up to 1.07) , then take the number of miles you travel and come up with it? I looked on a sheet and thought it would be .3235 X what they were paying me a mile which was 1.00 and then it would be 1.32, but I guess it would be the .3235 X the national price of Diesel, is this correct? OOIDA has a spreadsheet but that just got me more confused than anything.... doesn't take much to do this though.

[chris1]

FSC would be 32.25% of the linehaul rate. If the linehaul is 1.00 then the FSC would be 32.25. The FSC % is based on the current price of the fuel.

[Steel Horse Cowboy]

My scanner is acting up on me. I will keep trying, but for some reason I can print and fax, but the wireless wont work for scanning. And of course I bought the $300 Brother all-in-one that doesn't work as it's name implies LOL

[arky]

I come up with $1.06. (32.25 x 3.299 ) so the haul would be $2.06 per mile.

I don't think so.

$2.06/mile pulling containers? I'll be in Memphis next week to sign up!

I'm pretty sure that it would be a percentage of linehaul rate added to the line haul rate.

Example: LIne haul $1.00/mile x .3225= $1.3225/mile

Since Papa Rick posted about the rates for pulling containers in another thread, I'll use those rates.

$1.06/mile loaded + FSC @ 32.25% = $1.40/mile loaded
$0.89/mile empty + FSC @ 32.25% = $1.18/mile empty

avg revenue would be = $1.29/mile

Kinda cheap, but container rates always have been. If it keeps you home and that is important to you, it's probably as good as it's gonna get for local work and you do have a FSC system to protect you from the fuel spikes.

[Tobytob]

Papa rick, I was told that you take the The average price of fuel in that region and minus the Benchmark price(this is $1.10- Anytime fuel is over $1.10 you should apply a fuel surcharge to cover this cost of the increase). Divided that by the miles per gallon (you average),and this gives you a surcharge rate.
Multiplied by the miles driven gives the fuel surcharge amount you should recover....

example.
Fuel is $3.30 in midwest -$1.10= $2.20/6mpg= $.3666 is your fuel surcharge rate
Lets say you have a trip of 840 miles. 840 x $.37 (rounded up)= $310 is what you should recover in fuel surcharge, Plus your mileage pay.
$1.00 PM x 840 miles = $840
$840+ $310= $1150 is what you should receive for this load all together.

Hope that helps.. This is the formula, I've been using..

[Steel Horse Cowboy]

Here's a quick breakdown of our FSC when the national avg is $3.00

Price FSC
3.00 .37
3.05 .38
3.10 .39
3.15 .40

and so on every .05 increase in avg price raises our FSC .01

Right now we are at .48cpm for FSC

At $5.00 National Avg it goes up tho....

5.00=1.00fsc
5.50=1.50fsc
6.00=2.00fsc

[Papa Rick]

Here's a quick breakdown of our FSC when the national avg is $3.00

Price FSC
3.00 .37
3.05 .38
3.10 .39
3.15 .40

and so on every .05 increase in avg price raises our FSC .01

Right now we are at .48cpm for FSC

At $5.00 National Avg it goes up tho....

5.00=1.00fsc
5.50=1.50fsc
6.00=2.00fsc

Where do you come up with your FSC (What chart or company) OOIDA has one that is showing 0.3527 for price of 3.299? I know this is all easy, just not getting the hang of it.

Papa rick, I was told that you take the The average price of fuel in that region and minus the Benchmark price(this is $1.10- Anytime fuel is over $1.10 you should apply a fuel surcharge to cover this cost of the increase). Divided that by the miles per gallon (you average),and this gives you a surcharge rate.
Multiplied by the miles driven gives the fuel surcharge amount you should recover

Now this I might, let me say HOPE I am understanding it, but some people are saying the benchmark is anywhere from 1.10 up to 1.30?? (How and when do you come up with this?)

[Steel Horse Cowboy]

That is the plan that Quality Carriers has in place. We have a set price of $1.25 a gallon for fuel. After $1.25 is when the fsc starts and its based on 5.8mpg

[Papa Rick]

ok Thanks Steel Horse Cowboy

[Steel Horse Cowboy]

Not a prob, just figured it could help u figure some stuff out. I know we have one of the best fsc out there, might as well carry it over to your business.

[Tobytob]

Papa, yes the benchmark is anywhere from$1.10 to $1.25. I was just using an example I found when I was researching the same question. I usually use the higher # when I'm in a region with high fuel prices, if it lower in a region I use a $1.15. But thats the formula I use and I haven't had a problem with it yet. Good luck.

Let me know what you find out about getting your own Authority, I'm seriously looking into it. I'm tired of wasting my time with these companies..

[geeshock]

I don't think so.

$2.06/mile pulling containers? I'll be in Memphis next week to sign up!

I'm pretty sure that it would be a percentage of linehaul rate added to the line haul rate.

Example: LIne haul $1.00/mile x .3225= $1.3225/mile

Since Papa Rick posted about the rates for pulling containers in another thread, I'll use those rates.

$1.06/mile loaded + FSC @ 32.25% = $1.40/mile loaded
$0.89/mile empty + FSC @ 32.25% = $1.18/mile empty

avg revenue would be = $1.29/mile

Kinda cheap, but container rates always have been. If it keeps you home and that is important to you, it's probably as good as it's gonna get for local work and you do have a FSC system to protect you from the fuel spikes.

thats how I have always understood it as well amount per mile and multiply it by percentage. Not sure how they work it out if it's a percentage of the load.

[GMAN]

There are two ways that most carriers calculate the fuel surcharge. Percentage or cents per gallon. As was previously stated, if it is a percentage then it is based upon the line haul rate and added on to the total for the rate. If it is based upon using cents per increase in the price of a gallon of fuel then it can be calculated like this.

I use a base of $1.10/gallon as the base for my fsc calculations. Anything over that price is used to calculate the fsc. For instance, if fuel is $3.50/gallon you would subtract the base line price of $1.10 which would give you a difference in price of $2.40/gallon. If you use a mpg of 5 mpg, then you divide that into the difference to get your fsc. In this example, the fsc would be ($2.40/5 mpg = $0.48/mile fsc). If you use 6 mpg then your fsc would be (2.40/6 mpg = $0.40/mile fsc). Some companies will offer a smaller fsc for their better shippers. If you lease to a carrier they should give you your percentage of the line haul and then add 100% of the fsc to your part of the revenue. I seem to remember that Landstar started taking their percentage of the fsc along with their part of the line haul.

Most recalculate their fsc each week when the feds publish the average national price for diesel. It comes out every Monday. You can subscribe to the service at no charge and it will be automatically emailed to you every week. Another factor could be the regional prices as someone else mentioned. I have know of some who base their fsc using the regional average price for fuel and others use the national average for their fleets. If it is done regionally, it could be done based upon either from the point of origin or the receiving end. There are several factors which could be in play when calculating the fsc. The feds use a fsc based upon $2.50/gallon. Some contracts that I have seen the last year don't even show the fsc. It is all calculated in the rate.

If you lease to a carrier you need to ask how they calculate their fsc. Sometimes it is the shipper who dictates how the fsc is paid.

[LOAD IT]

A percentage FSC plan will make you some extra money over time. Also remember to DOUBLE your FSC on any shorter hauls (<250 miles).

If you are serious about getting authority, I can help you with that for a very small fee and you will be up and running in 10 business days, if you're serious.

[Papa Rick]

Thanks Load It, really appreciate it, but right now at this time I am leaning going towards leasing on with a Company and getting more experience learning how to deal with brokers and agents.

[LOAD IT]

Thanks Load It, really appreciate it, but right now at this time I am leaning going towards leasing on with a Company and getting more experience learning how to deal with brokers and agents.

I have a deal with some dry specialized freight out of Atlanta GA area, It does require an OTR truck though unless you plan to sleep across the seats (LOL). You can lease on or run your own authority. Business is steady and will be picking up even more in spring/summer.