June 1, 2022 Fuel Surcharge Implementation
June 1, 2022
It’s hard to believe that June is already here! I trust that you, your family and your businesses are doing well. This year has certainly brought many surprises to Crystal Courier and I am certain that your businesses have experienced the same.
To that end, we’ve tried hard to keep up with the rising labor and insurance costs that have plagued all of our businesses. Thinking back to the start of the year, the one factor that we couldn’t predict was the current fuel market. When we went through our most recent pricing calculations at the beginning of the year, our prices were set on a $3.25/gallon fuel average. The currently published AAA Colorado price in Denver is $4.34 for a gallon of gas.
While we’ve been able to absorb this increase to date, hoping that the market would relent, we are at the point where we must adjust for this increased cost. We feel that the most fair way to approach this is through a fuel surcharge. Please know that this is our last resort; this certainly isn’t a way to increase profits. Rather, this is simply necessary to cover the costs of getting our drivers to each stop. We know that we must remain more competitive than any other delivery option available and we are committed to doing that.
To calculate the fuel surcharge on each month’s invoice, we will use the Denver Metro Area current average price for a gallon of regular fuel. This information can be found at https://gasprices.aaa.com/?state=CO. The actual price of your surcharge will be 0.85% for every $0.10 change in the published price over $3.50. To share some of this burden, we are setting the base fuel cost at $3.50, not the $3.25 that our costs were based upon. This structure represents our current volumes, route loads, and vehicle fleet. For examples of the surcharge levels, please see the table at the bottom of this page. This surcharge will be effective on all stops starting on 6/1/22 so you will not see it on your May invoice.
Thank you for your understanding and your continued support. We truly appreciate your partnership.
Crystal Courier Service
For example, if your base per-stop fee is $10 and the average price of fuel for the month is $4.45, your cost for that stop would now be $10 x 1.0765 = $10.77