Fuel Surcharges now @ 20%

Discussion in 'APUG.ORG Advertisers Forum' started by Formulary/Bud Wilson, Apr 23, 2008.

  1. Formulary/Bud Wilson

    Formulary/Bud Wilson Advertiser

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    Hello APUG

    This is a FYI annoucement and hope to have some feed back as to what to do. Our last UPS and FEDX bills have 20% fuel surcharges for all air shipments and 6.25% fuel surcharges for all ground shipments. These are applied to the entire bill not just the shipping charge but also applied to the residential surcharge of $1.95, and the rural surcharge of $.80. We have been absorbing these surcharges for years but now we are actually paying to ship product. These companies are sucking so much cash out of the economy it is unreal. Probably good stock to own because of the surcharges they don't care where fuel costs go, it is just added on and little companies like us just have to eat it. Our only option is to again raise our shipping charges, or add a surcharge as they do. We also pay a 20 to 25% fuel surcharge to all trucking companies on our incoming freight. That is 25% of the freight bill not just an additional fuel charge.
    I don't mean to whine or complain just letting everyone know that we have a problem here and to expect an immediate increase in costs somehow. I would like feed back if there is any.
    This is a national problem with these fuel costs. Every company in the nation is feeling the same pinch I am trying to explain here. Everything you buy and I do mean everything has to increase in price because of this.
    I try to never get into a political discussion but somewhere somehow, someone has got to start doing something about this. ANY IDEAS

    Thanks for letting me vent
    Bud Wilson
     
  2. TheFlyingCamera

    TheFlyingCamera Membership Council

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    As a solution for yourself, I'd tack it on the same way the shipping companies do, as a surcharge, so if/when the cost comes down, you can rescind it and pass the savings back to your customers.
     
  3. justpete

    justpete Subscriber

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    Surcharges are a part of your cost of sales, just as fuel is part of the shippers' cost of sales. It's gotta come from somewhere; pass it along and we'll just order more at a time to spread out the cost. Gotta pass along corporate income tax, etc., why not an escalating cost of doing business? Y'all ain't a charity. :smile:
     
  4. resummerfield

    resummerfield Subscriber

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    Bud, you don't have any choice. To stay in business, you have to adjust your customer shipping costs to reflect what you spend.

    I don't understand why the shipping companies call this a surcharge, as if fuel prices will eventually come down. High oil costs are here to stay. :mad:
     
  5. JBrunner

    JBrunner Moderator Staff Member

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    Hi Bud,

    These shipping companies like to call it a "surcharge" because if they didn't they'd have to admit they raised their rates, which is exactly what they did, no matter the reason or what they choose to call it. Typical modern doublespeak crap.

    When I order from the Formulary the shipping costs are part of the deal, and I expect to pay that, so whatever the shipping bill will be, including "surcharges" that's what I expect to pay.

    I wouldn't expect you to eat it, and you shouldn't.
     
  6. Andrey

    Andrey Member

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    Economy depends on gas, everybody is getting squeezed.
     
  7. jgjbowen

    jgjbowen Member

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    Bud,

    Just move the formulary to the east coast. Shipping stuff to never never land Montana, then out to the east or west coast has got to be a killer. Move your operation closer to your customer base.

    I'm just kidding Bud. If I were fortunate enough to live where you live, I wouldn't think of moving either.

    I think your customers will understand a couple extra $$ for shipping.
     
  8. BradS

    BradS Subscriber

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    Hmmm, that reminds me. I'm running low on Sodium Sulfite. Guess I better stock up...soon!
     
  9. Curt

    Curt Subscriber

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    Just yesterday UPS announced a profit increase for the quarter, they aren't hurting, just squeezing those who have to pay.
     
    Last edited by a moderator: Apr 24, 2008
  10. Dana Sullivan

    Dana Sullivan Advertiser

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    Bud, check out a service like ishipper.com. I never have to worry about changing my rates, because ishipper feeds my website with all the shipping rates, and they always have the latest updates. My website sends them a query which has the zip code and total weight, and they send back the rates for the services I want to offer my customers. You can even have it add on 5-10% extra or say an even $1.50 per package to cover any additional handling fees you might have on your side. It's surprisingly accurate for UPS ground and USPS Priority, and usually pretty good for 2nd day, 3rd day and overnight rates. Check it out, it saves me a ton of headaches.
     
  11. rob champagne

    rob champagne Member

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    Oh, I thought it was war tax...
     
  12. MikeSeb

    MikeSeb Member

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    here we go again...

    No one "has" to pay. They can use FedEx or the postal service if they don't like UPS's rates. A vague and ill-informed hostility to the workings of capitalism seems to permeate this, and other, online forums. I'm not attacking Curt personally, just pointing out the prevalence of the attitude his post seems to reveal.

    Herewith a brief primer: capital seeks its highest rate of return. UPS will charge what it thinks it has to, above covering its costs (can you imagine UPS's fuel bills?), to offer its owners sufficient ROI, thereby attracting capital to continue its operations and future growth. This is the sole purpose of a corporation (aside from occasional service as Congressional whipping-boy, tort-bar suckling pig, or "corporate" tax conduit--since "corporate" taxes are paid by customers, employees, and shareholders, not by corporations.) UPS is no more a charity than is the Formulary.

    At some point UPS will be constrained by market forces from further raising its prices, lest it lose market share. If its operating costs continue to escalate, yet it can't charge more for its services, then those profits you decry will decrease. At some point this will result--in the aggregate across a vast economy--in fewer choices and poorer service for the customer. Feel better?

    Investors make capital-investment decisions based on potential ROI versus risk. This is why, for instance, pharmaceutical companies have--and must have--relatively high profit margins; theirs is an extremely risky business, and they can't attract capital unless they consistently deliver profit commensurate with that risk. [So let's beat the crap out of them, and blame the ills of our healthcare-delivery system on their "excessive" profits. Much easier than figuring out an actual fix, which would probably require a permanent Congressional recess.]

    Same with oil companies. No one at present remembers when oil was $10 a barrel, and the Gulf Coast was in the crapper as oil- and oil-service companies were going belly up left and right (I grew up in Louisiana so I DO remember.) Now we have the feckless idiots in Congress parading oil-company execs in front of the cameras to account for their "obscene" "windfall" profits--never mind that their profit margins, at 8-10%, are about a third of those regularly enjoyed by the tech industry.

    Bottom line, oil prices are driven by the balance of supply and demand, and by transactions at the margins where speculators try to divine future trends. There is some evidence that higher prices are changing driving habits more effectively than any government mandate ever has. If you're old enough to recall gas lines in the 70's, you'll know to pray that Congress does not heed the calls for someone to "do something." Any "something" ginned up by government is sure to make things worse, unless two centuries of previous experience can offer no future guidance.

    Thanks for letting ME vent. :smile:
     
  13. David A. Goldfarb

    David A. Goldfarb Moderator Staff Member

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    Could we save the general discussion about politics and the price of gas and shipping for the SoapBox, and keep this thread about practical suggestions to help Bud keep down his shipping costs? Thanks.

    On that note, the Formulary product I use most is TF-4. Fortunately I can buy it off the shelf at B&H, but most people have to have it shipped, and I suspect that the B&H price might go up as it's got to be shipped to B&H.

    Maybe it's time to think about formulating a comparable product (an alkaline rapid fixer) that can be sold as a powder. I've thought a bit about it myself, and then realized that since ammonium thiosulfate is usually sold as a liquid concentrate, it wasn't going to be easy getting around having to ship water unless I wanted to use a sodium thiosulfate fixer (which I do for certain things), which would mean longer fixing and washing times generally. Maybe PE's got some ideas, since he's worked a lot on fixes and blixes, or Bill Troop could make some suggestions.
     
  14. johnnywalker

    johnnywalker Subscriber

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    Freestyle sells Kentmere "Kentfix" fixer in powder form. It is a hardening fixer though, which if I recall correctly precludes toning?
     
  15. David A. Goldfarb

    David A. Goldfarb Moderator Staff Member

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    I think Kentfix is just a version of Kodak Fixer, which is also a powder, but not an alkaline rapid fixer.
     
  16. dr5chrome

    dr5chrome Member

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    ..i don't think there is anything that can be done, and short of soap-boxing, vote the suckers out!

    We have to charge our clients the extra in shipping. We are pretty up-front about this. We only charge what the shipping cost us. We see complaints continually about what we charge for shipping. We simply cant list the ship rates, it changes every week!

    Unlike the replies in this post we get the "does that include the shipping" remarks. All you can do is roll your eyes at that point..

    We get the double whammy also on our end. What you charge us for chemistry, we have to raise our rates on top of the shipping costs. I can tell you one thing for sure; even with our current rate change, we still cant pay the bills. Some understand, most do not.:sad:

    dw






     
  17. Formulary/Bud Wilson

    Formulary/Bud Wilson Advertiser

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    Fuel surcharges now 20%

    Apug;

    Thanks for the input, we will see what we have to do and can do.
    Just FYI again.
    Shipping charges include a few more things than UPS.
    tape, boxes, shrink wrap, those little irritating peanuts, UPS computer, printer, and best of all an employee to pack and ship and another employee to pull orders. 2 employees help keep mistakes from happening in what is recieved compared to what is ordered.
    I'll get off my soap box now and leave ya all with something my grandpappy told me more than once. "Bud you just have to out earn em"

    Thanks Bud
     
  18. mark

    mark Member

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    Yous gotta do what yous gotta do.
     
  19. 2F/2F

    2F/2F Member

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    Raise your extremely reasonable prices? Look into other shippers?

    Your contact frames are absolute steals. I couldn't make them for what you charge, at least not without making a large run at once. Your chemicals are cheap. I would pay 25% more for them, personally, and I do not have a ton of money.

    You can't be paying for people's shipping. First things first, raise shipping prices to the point where you are not taking any hits on shipping.
     
    Last edited by a moderator: May 17, 2008
  20. donbga

    donbga Member

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    Jason,

    I can you tell from an insiders viewpoint that fuel costs have had a major impact on shipping costs for any business that operates a fleet of vehicles of any size.

    In short your remarks are not accurate.
     
    Last edited by a moderator: May 17, 2008
  21. MikeSeb

    MikeSeb Member

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    We here should all know that a business selling stuff has to recoup its costs and make a profit to remain in business, no matter whether its charges are called "surcharges" or "shipping", or are merely incorporated into the price of each item. So why quibble over terminology? Thinking--and some awareness of economics--trumps doublespeak every time.

    Anyone who has used The Formulary (I have) recognizes that they offer good products and service at fair prices, and that shipping charges aren't directly their fault. Anyone can buy from TF, or find another source--the market at work. I imagine it costs them more not only to ship stuff to their customers, but more to obtain their own stock. If you can do better elsewhere, you probably should. Good luck with that....

    If you can figure out which pandering politician to blame for "high gas prices" (I believe it is the Secretary of Gas-Price-Setting) by all means vote him/her out of office and await the sunny Garden of Eden to follow when his/her successor "does something" about the problem. No elected official in the US sets gas prices, unless you count Congress, which has done all it can to decrease supply; or Ben Bernanke (indirectly a presidential creature), whose loose-money policies have fueled the devaluation of the dollar and a worldwide commodity-price runup; or whoever is telling 2.5 billion Indians and Chinese to expand their economies and demand more oil. Last I read, none of those guys are up for office here, though I think the Republicans would clutch at any passing lifeboat come November....

    I suppose I am to be chided once more for "soapboxing". Bud, keep doing what you're doing; you're more than worthy of the APUG community's continued support.

    :smile: