fuel surcharge
- Thread starter morningwood
- Start date
tenntrucker
Expert Expediter
My guess its a much bigger deal for hired drivers working on the 60/40 type split.
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Gary..who cares?....as long as YOU get the price you need?......if the carrier makes a snot load of money from a load and we get what we need...carrier makes money, we make money....everyone is happy....
Well if your contract says that your carrier gets 20% and you get 80% and they manipulate the FSC to take money from you then they aren't living up to the contract right?
That might not be important to you, but it might be to me. I would rather be in a situation where there are a few less grey area's to deal with, and that is what I have.
Granted, I have a lot to learn, but I can at least see something that has the potential to be abused...
That might not be important to you, but it might be to me. I would rather be in a situation where there are a few less grey area's to deal with, and that is what I have.
Granted, I have a lot to learn, but I can at least see something that has the potential to be abused...
They can manipulate all day....as long as my per mile rate is where i need it to be....if they play too much....then I'll just turn down any unprofitable loads.... All the carrier is required to do is give you your % contract rate....if its too low most times....then time to go shopping...
thanks for all the info-i do understand bottom line per mile,but when shopping for carrier to work for they all throw out the numbers at you so many diffront ways. confusing to a newbe
some create their programs that way on purpose I believe...LOL.....it keeps us from getting bored...hahaha
and some have excelled at it....LOL
As an owner I don't care how they label anything as long as the bottom line comes out where I want it. I'll run the load for $1.10 a mile and zero FSC. I'll run the load for free if it has $1.10 a mile FSC. I don't care either way as long as it all adds up.
That said, there are stipulations. I worked with one carrier that would give a load offer with a certain FSC. Payday would roll around and they would only pay 1/2 FSC or maybe 1/3 FSC. It didn't happen often but it did now and then. That just wasn't right and is one of the main reasons I left them. I agreed to run their job for a certain amount and they agreed to pay that amount and then later they reneged saying the customer didn't pay as much FSC as they agreed to pay. I'm sorry but in that case they should have paid it from their own pocket to live up to their contract. Offer and acceptance equals contract. They are breeching their contract when they do that.
Now, anyone that isn't an owner operator and drives for an owner is in a completely different situation. If they are receiving 60% plus FSC and paying for fuel they are extremely interested in how the money breaks down. They much rather run for a dime a mile plus $1 FSC which pays them $1.06 a mile than to run for $1 a mile plus a dime FSC which pays them 70 cents per mile.
That said, there are stipulations. I worked with one carrier that would give a load offer with a certain FSC. Payday would roll around and they would only pay 1/2 FSC or maybe 1/3 FSC. It didn't happen often but it did now and then. That just wasn't right and is one of the main reasons I left them. I agreed to run their job for a certain amount and they agreed to pay that amount and then later they reneged saying the customer didn't pay as much FSC as they agreed to pay. I'm sorry but in that case they should have paid it from their own pocket to live up to their contract. Offer and acceptance equals contract. They are breeching their contract when they do that.
Now, anyone that isn't an owner operator and drives for an owner is in a completely different situation. If they are receiving 60% plus FSC and paying for fuel they are extremely interested in how the money breaks down. They much rather run for a dime a mile plus $1 FSC which pays them $1.06 a mile than to run for $1 a mile plus a dime FSC which pays them 70 cents per mile.
Many bids are all-in, but there are several customers where the bids are made on the line-haul only, and then the contracted FSC gets added in. Or they are all-in, burt the FSC is a predetermined amount of percentage. The reason for this, and why the carriers break it down, is because, for example, if your carrier takes 20% and gives you 80%, they are taking 20% of your FSC if it isn't broken down. But 100% of the FSC should be passed through, and then the 80/20 figured on the line-haul only. If they're taking their percentage out of both the line-haul and the FSC, then they aren't living up to their responsibilities. The FSC is a charge the customer pays to directly offset the cost of fuel, and if the carrier isn't paying 20% of your fuel, they are not entitled to 20% of the FSC. There's your gray area and transparency right there.
The reason it changes from load to load is because the customers and the contracts change from load to load, along with the fluctuating price of fuel.
You don't mess with FSC with your carrier and are happy where you're at, and that's fine, but if your carrier is charging a FSC to the customer (and they are, even with all-in bids), and if they aren't passing 100% of it along to you, then that's abusing the system and you right along with it.
The attitude of "as long as I get what makes me happy, how much the carrier makes is irrelevant" is certainly one possible way to look at it, and if you're happy that's great. But it's a little short-sighted on two ways. If you get what you like and the carrier is losing money, that's not right or fair to the carrier. The reverse it also true, where if you get what makes you happy but the carrier is taking more than their fair share, that's not right or fair to you.
The reality is, you aren't out here to get what makes you happy, that's not what the cooperative partnership between owner/operator and carrier is all about. You are out here to pay the carrier a certain percentage of the line haul to find you loads, do the collections and forward you the money you are owed. They work for you just as much as you work for them, and most owner/operators don't want to pay a portion of their FSC to the carrier as compensation for what the carrier is being paid to do.
tenntrucker
Expert Expediter
Pretty much true, I say I get layed off after every load and rehired when the next load comes thru. The truth is I never ask what a load pays, most time its several days later before its rated & posted on fleet vision. Sounds strange to most of you, but I have a very good weekly average. I more interested in where I end up after a run than what it pays. I know if we get the run, it pays good.
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Then explain why FSC could fluctuate as much as $0.30 per load on the same day? If it is based on fuel pricing, it shouldn't change that much, and what good is it if you can't depend on it to protect you on a load by load basis. I would rather work with a carrier that is constantly getting me and average of $1.85 per mile without a FSC than a carrier that is getting me an average of $1.65 with a FSC...
My statements were based that if i were happy with the rate that an assumption the carrier got what they needed as well....
You think all customers are all charged the same FSC rate by all carriers? They're not. One customer may have 8 different FSC rates depending on weight, distance, dimensions, time of day shipped, origin and destination, and any combination of the above. It can also fluctuate greatly when all-in bids are won at higher or lower rates, and the carrier properly breaks out the FSC so as to not take a percentage of the FSC along with the line-haul.
It's based on both fuel pricing and on existing contracts, but in any case, expediting isn't measured on a load-by-load basis, anyway. It's measures by the week, month, quarter and year. I've had loads with a relatively low FSC, and then the next load might be twice or more the "standard" FSC rate, whatever that might be.
Well, that's apples and oranges. You're saying you's rather have an average rate to the truck at $1.85 than an average rate to the truck of $1.65, which is a "well, duh" moment. But using your 80/20 split as an example, and $1.85 as your happy-happy rate to the truck, would you rather have a load that the customer pays the line-haul of $2.3125 which when broken down is $0.566 FSC and $1.7465 line-haul, and 80% of each equals $1.85, or would you prefer that the entire $0.566 is passed along to you and then the carrier passes along 80% of the $1.7465?
In the first scenario, you get your $1.85 and you're all happy-happy, but in the second scenario you would get $1.3972 line-haul + $0.566 FSC for a total of $1.96, with the carrier retaining their contracted 20% of the line-haul.
Carriers who don't break out the FSC and instead take their percentage out of the entire bucket, are taking money they aren't entitled to, regardless of how happy you are with the arrangement. Granted, 80/20 is a very low percentage to a carrier, so in that scenario a carrier taking 20% of the FSC may very well be an acceptable and equitable arrangement. It would be for me. But most carriers are on something closer to a 60/40 split, and in that case I'd want the FSC to be properly broken out before percentages are figured, because 40% is a snotload of money to pay a carrier for what they do.
Yeah, I know. I wasn't commenting specifically on your statement. I know where you're coming from. It was more of a general statement on the attitudes that some people (those who rarely look at the big picture) in this business have.
tenntrucker
Expert Expediter
What I go by is that I see some carriers that offer 72% + fsc. I figure that about equal to my total %.
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