Tuesday, December 15, 2009

Do you know how to figure out Mileage rate and fuel surcharge?

I have a 2004 Nissan UD Truck and want to open a business in deliveries. Can anyone help me on the charges to clients. How much for mileage rate, fuel surcharge, charge per hour, charge per weight, per pallet?


Thank YouDo you know how to figure out Mileage rate and fuel surcharge?
What you should do instead is follow a pricing scheme based on your own costs. Here are two very commonly used schemes:





COST PLUS





calculate all costs involved in delivery:


truck depreciation


truck labor costs (including wage and payroll)


gas


insurance


repairs


and anything else you think you'll have





find your own required rate of return on your investment in the company





total cost + required rate of return = retail level price





TARGET RETAIL PRICE





If you offer a premium service with no competitors, you can use this scheme to get what your service is truly worth.





find the maximum that your clients are willing to pay (your target price)





find your required rate of return as before





target price - required rate of return = target cost





If your true costs are higher than your target cost, you have to find a way to reduce costs while offering the same service.
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