Trucking: Fuel Surcharge, fuel mileage, trailer insurance

Question
Jim,

I am leased on to a small trucking company that hauls for a bigger carrier in our state.  They pay a fuel surcharge for all trips.  The company we are leased on to takes 15% of all trips for them to to do all paperwork, fuel tax, trailer insurance, etc.  When we are paid eeach week they take 15% total.  Is that fair?  Shouldn't I get the full fuel surchagre amount and they only get 15% of each load total for the week.  I am new at this and feel I am getting ripped off.  I am the one paying for the fuel in my truck not them.  Shouldn't I receive the whole fuel surcharge per each trip??  Please help?

Thank you very much


Answer
Gail, the question "Is that fair?" is relative.  It all depends on the total deal.  If they are doing all paperwork, fuel tax, trailer insurance, etc. there is some value in you not having to deal with it.  If you are using their fuel card they have some risk also.  I don't know if 15% is a fair number since it depends on what you get for the percentage.  On the other hand as fuel rises the actual dollars can become significant.  You can always look for a better deal somewhere else but that may not always work out the way you planned.  It's easy enough to calculate what your actual out of pocket expense is on each trip.  Subtract 1.20 to 1.25 per gallon which is the generally accepted base cost that should be included in the rate before FSC.  So if fuel is at 4.49 you should be recovering the equivalent of 3.24 per gallon in FSC.  Some large shippers have pushed the "peg" higher than 1.25 but in those cases the base rate should be increased to be in line with that.
There are so many moving parts that it's really difficult to decide what is "fair" to all parties.  There are several common sense things you can do to conserve and get better fuel mileage but ultimately you need to understand all of your costs and get compensated accordingly.
Best of luck. Jim.