This is a difficult subject to discuss with the shipper because it means raising rates -you could lose the business you’ve been getting from that shipper. So how do you go about get the fuel surcharge to cushion the high cost of fuel hitting your business?
If you have had this shipper/customer for a while, the task is somewhat easier and could be discussed over the telephone and followed up with a letter spelling out the details. Of-course any time you are about to raise, check to see what the market is doing and then tread carefully. Here is a sample letter that you can use when notifying your shipper about the pending increase:
City, State Zip
123 Main Street
Your Town, USA 12345
I am sure that you are aware that fuel prices have spiraled upward over the past several months, and presently are higher than they have ever been in our history. We have acted in good faith in our attempt to resist seeking relief, but this has placed an undue burden on us. We had hoped that this would be a short term inconvenience, but now it looks as if it will last longer than expected. Due to the critical nature of the current situation, we can no longer continue to absorb these increased costs.
Therefore, we must implement a temporary fuel surcharge on all shipments. This fuel surcharge will remain independent from our base rates and will be shown as a separate entry on our freight bills. We will compute the fuel surcharge on a mileage basis, and it will reflect the extra cost of the fuel used in the specific trip.
Our computations will be based on the U.S. National Average Diesel Fuel Index. (You may view the charts provided by the Department of Energy by visiting their website at http://tonto.eia.doe.gov/oog/info/wohdp/diesel_detail_report.asp . We will review this data and calculate our actual costs on a weekly basis. The figure used for cost per gallon is also region specific, established by the average cost of fuel per gallon, on the date and in the load’s origination point.
We regret that this action is necessary and deeply appreciate your understanding and partnership with us in helping to share the burden of these fuel cost increases. Together, we will keep our nation strong during this time of crisis. We hope that this solution will keep the goods and services that power our great nation’s economy moving.
I am sure there are other ways that this subject can be approached. Any thoughts out there?