We're getting a lot more surcharges from our suppliers for things like fuel
(freight), natural gas (heat treating), environmental (plating), scrap &
material (castings and steel). They're becoming more significant and we'd
like to pass them on to our customers by some (flexible) method other than a
price increase.
We've been using surcharges with one of our major customers but it's messy.
They want to see surcharges as a separate line item on the packing slip. We
actually "ship" a part called "surcharge" (non-stock, std cost = $0.00,
non-nettable bin) in equal amounts to the product being shipped with a unit
cost equal to the surcharge for each part. Their buyer then has to O.K.
every surcharge line on our invoices for them to be paid. It's not a method
all other customers will accept I'm sure.
Obviously, surcharges are hard to figure and vary widely part to part. Most
are by part weight or at least a portion of the final assembled part's
weight. There's also no clean cut off date from one surcharge level to
another so to make it perfectly correct is really not practical.
Are any of you doing something similar? What other methods do you guys use
if any?
Greg Clauser
General Manager.
Lakin General Corporation
773-871-9604 fax:773-871-1265
gclauser@...
[Non-text portions of this message have been removed]
(freight), natural gas (heat treating), environmental (plating), scrap &
material (castings and steel). They're becoming more significant and we'd
like to pass them on to our customers by some (flexible) method other than a
price increase.
We've been using surcharges with one of our major customers but it's messy.
They want to see surcharges as a separate line item on the packing slip. We
actually "ship" a part called "surcharge" (non-stock, std cost = $0.00,
non-nettable bin) in equal amounts to the product being shipped with a unit
cost equal to the surcharge for each part. Their buyer then has to O.K.
every surcharge line on our invoices for them to be paid. It's not a method
all other customers will accept I'm sure.
Obviously, surcharges are hard to figure and vary widely part to part. Most
are by part weight or at least a portion of the final assembled part's
weight. There's also no clean cut off date from one surcharge level to
another so to make it perfectly correct is really not practical.
Are any of you doing something similar? What other methods do you guys use
if any?
Greg Clauser
General Manager.
Lakin General Corporation
773-871-9604 fax:773-871-1265
gclauser@...
[Non-text portions of this message have been removed]