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tiedeman
04-17-2006, 11:51 PM
Crude is almost touching $71 a barrel, currently sitting at $70.74. It has gone up almost $2 in the last day. This is going to be a long summer

Steve
04-18-2006, 01:17 AM
From what I have read it seems this isn't the peak either.

kc2006
04-18-2006, 01:47 AM
What do you guys think is a good price to enact a fuel surcharge? All my current customers are priced with fuel at $2.50 a gallon, so i'm somewhat safe on them, but for new customers I want to include in the contracts a fuel surcharge over X amount per gallon. I was thinking $3.50 a gallon is when I'd put a surcharge on. I was going to go $3, but heck we're almost at $3 now so that wouldn't work, I can just bid accordingly using the current price of $3 a gallon.

Steve
04-18-2006, 04:09 PM
That sounds resonable.

CNN (http://money.cnn.com/2006/04/18/markets/oil.reut/index.htm) - Oil smashes record, settles over $71
Iran worries and Nigeria supply disruptions push price of crude to record trading and closing high; fund buying provides support.

tiedeman
04-18-2006, 06:40 PM
yup, I just checked www.nymex.com and it's like $71.20 right now

I personally don't agree with a fuel surcharge. Because of two reasons:
1. How are you going to keep track of the gas prices going up and down during the day and justifing that to your customers
2. This is big kicker. If gas prices go down, will you give customers a refund? Probably not.

That is why I feel that from now on, all new work, so have a higher price tag on it. Bascially, make your services a higher price, don't add that fuel surcharge as an additional price. For example, if you are charging $50 an hour right now, raise it up to $52 an hour.

Steve
04-18-2006, 10:59 PM
Great insight.

kc2006
04-18-2006, 11:55 PM
Thanks for the infro Troy. I had the same thoughts about trying to justify when the fuel was up.

So far everything is being priced on a higher scale, so I'm good for now. I'm just looking for future when/if fuel jumps to who knows $5 a gallon.

tiedeman
04-19-2006, 12:01 AM
I know what you mean. Currently for misc work rate I am going to raise my hourly rate to $52 an hour, from my current $50. I am ok for spring and fall clean ups, currently sitting at $72 an hour. I raised those up last year, and so far no one is really concerned with that price.

Also I am debating about either to raise fertilizer prices for new customers, or try to find a cheaper, yet still great quality product.

Also how I am fixing the problem is by lowering my expenses on this end. It has been really hard so far, because two years ago, I went through a major expense cutting technique, which worked greatly and I continue to use, but I am maxed out at how much more I can cut. The next things on my list to cut are cell phone and credit card processing.

Steve
04-19-2006, 01:43 AM
What % of your customers pay by credit card now?

tiedeman
04-19-2006, 02:57 AM
that is so funny you mentioned about the credit card thing, because I just finished off some sheets to look at the numbers again. Last year I look at credit card expenses, vs. sales was last November.

But I would say only about 1% of my customers use credit card

Steve
04-19-2006, 03:21 AM
How does knowing that effect your view then of credit card processing?

tiedeman
04-19-2006, 03:33 AM
For example, if I am doing $1,200 a year in sales by payment with credit card, and $300 in bank fees, to me, it's not worth it then. I am losing a possible $300 a year. Sure, I could be also losing $900 a year if you look at it the other way.

No matter what, my basic charge a year is approx $180.

Now, I am just taking a brief look at my sales for only 2005 so far...sales were $2,765.40. But my credit card expenses for 2005 (monthly fee, processing charges, etc) were $246.24.

Was it worth it to lose $246, to push $2765 in sales? Maybe, maybe not. That is what I have to figure out. Would I have lost those sales if I did not accept credit cards? That is what i have to find out

tiedeman
04-19-2006, 07:36 PM
Here you go guys. *This is the break down of me accepting credit cards

ACCEPTING CREDIT CARDS

* * * * *INCOME * *COST * * NET
2004 $1,892.04 $231.98 $1,660.06
2005 $2,881.40 $230.05 $2,651.35
2006 $1,295.90 $39.00 $1,256.90
* * * * $6,069.34 $501.03 $5,568.31 TOTAL

tiedeman
04-19-2006, 07:44 PM
After I broke that down and figured out the profit margin, I am still making around 91% profit margin off from accepting credit cards. I think that i am going to hold out a little longer, and still process them

Steve
04-19-2006, 09:22 PM
Another thing to think of is, could you get more of your customers to pay by credit card?

tiedeman
04-19-2006, 09:26 PM
To be honest with you, I would rather they didn't. Because each time a customer pays not only am I charge a transaction fee, but I am also charged a percentage of the sale

Accuscapes
04-19-2006, 09:40 PM
Tiedeman, I saw that you had a fee of $50 per hour, is this per man per hour or for a crew? I charge $25 per hour per man for any work other than contract services. I have tried to increase my fee but everytime I do the jobs go to someone else. Someone else who is probably unisured but to someone else. What services do you offer and do you have to have a certification to offer those services?

tiedeman
04-19-2006, 11:17 PM
Quote[/b] (Accuscapes @ April 19 2006,9:40)]Tiedeman, I saw that you had a fee of $50 per hour, is this per man per hour or for a crew? I charge $25 per hour per man for any work other than contract services. I have tried to increase my fee but everytime I do the jobs go to someone else. Someone else who is probably unisured but to someone else. What services do you offer and do you have to have a certification to offer those services?
I charge $50 per hour, per person. But as of right now, it's just me

Just my pesticide applications I have to had certification, and license for