Fuel prices

[R.Perry]

What are our new fuel prices having on your bottom line?

One of my clients is 280 miles round trip. Contracted price per visit but the $5.40 cents a gallon average is taking a chunk out of the profit.

 

[Pelagic One]

@R.Perry — You and I discussed my 300 mile round trip weekly job just south of Fresno, where like you, I contracted a fixed per/visit rate a couple months ago for this 56-week contract.

Shortly after signing, Ukraine happened and I’m paying the $5.40/gallon average you’re seeing here in California. So I switched from driving my gas-powered Audi to using our son’s Prius hybrid, since he’s away at college.

If we didn’t have a hybrid to use, my bottom line would’ve taken such a major hit that I would’ve asked to amend the contract.

 

[R.Perry]

I normally use my F150 because because of other obligations I need a pickup. It averages 18 to 19 mpg, not good.
We recently bought a 2022 Toyota Camry, (wife's car) but I'm going to start using it at times.
Watch the oil company profits soar.

 

[Fred Garvin]

It's a hit, but not enough to really matter. In Texas, the most I've paid so far is $3.97 for regular unleaded. It's about $1.50 more than normal.

I include a 20 mile radius before my normal travel charges kick in. So, 40 miles (out & back) figured in to my pricing structure already. My Jeep gets about 18 mpg average; that's 2.2 gallons to cover my included travel.

I'm taking a $3 hit. Not gonna pass that to my clients.

 

[aerialimagery]

For me a 280-mile round trip is 7 gallons of gas, so the price increase amounts to less than $12, which is not that big of a deal, not that I'm happy with the increased prices. Maybe I would raise prices a little not so much because of the direct cost increase but because of how much everything else has gone up in price due to high fuel prices.

 

[R.Perry]

For me a 280-mile round trip is 7 gallons of gas, so the price increase amounts to less than $12, which is not that big of a deal, not that I'm happy with the increased prices. Maybe I would raise prices a little not so much because of the direct cost increase but because of how much everything else has gone up in price due to high fuel prices.

Good point, many people don't understand the effect that increased fuel prices. Farming, Trucking, Airlines all need to raise their prices, and that filters down to almost everything, and especially food prices.

 

[BigAl07]

We had just implemented a price increase in February so we're covered for "Fuel" increases but not so much for the cost of EVERYTHING ELSE!

So much of our lives have a TON of "embodied" petroleum that it's going to hurt across the board. Almost the same grocery list (at the same store) in 2020 was ~$150 and yesterday it was $225 and it had fewer items yesterday. That's just one "trip" that's gone up 50% and we're probably going to see those prices keep climbing over the next few months.

 

[R.Perry]

We had just implemented a price increase in February so we're covered for "Fuel" increases but not so much for the cost of EVERYTHING ELSE!

So much of our lives have a TON of "embodied" petroleum that it's going to hurt across the board. Almost the same grocery list (at the same store) in 2020 was ~$150 and yesterday it was $225 and it had fewer items yesterday. That's just one "trip" that's gone up 50% and we're probably going to see those prices keep climbing over the next few months.

As you stated about grocery prices. Every business needs to make a profit, however that seems to become blurred as to what a reasonable profit is. The farmer sees his fuel, pesticide, and fertilizer prices go up so that is passed on to the processing plants that turns the farmers product into a packaged product, The processing plant adjust their prices accordingly, and on to the grocery store. Now the shipping costs to the grocer has increased so guess what, that is passed on to the consumer. So lets say the farmer wants a 40% profit margin, the producer wants a 40% margin, and the grocer wants a 40% margin. You don't need to be a mathematician to figure the inflation rate.
Priced a good steak lately. Well Angus beef per pound is about 4.50 to 5.00 per pound plus 50 to 75 cents per pound for processing. That's before it goes to your grocery store.
How about a 16oz bag of Almonds, anywhere from 13.00 to 15.00 a bag. Want to know what is cost to produce 16oz of Almonds, about 45 cents, not a bad profit margin but the farmer isn't getting it.
Lot of greed going on here in American as well as else where in the world.

 

[Kristina Fowler]

I always charge "Mileage" as a separate line item on my invoices just to cover fuel burn ($0.30/mile R/T). No one has ever complained. I've held the line during this latest ramp-up on fuel prices. I've considered tying it directly to a state average index and letting it float along with changes. Example: if avg fuel price is $4.15, charge 10% of that per mile.... or $0.42/mile R/T.

 

[Pawel]

Hi,
On the side of this discussion I wonder how you price your such remote/distant jobs. I mean how much of the total cost you account for travel expenses and time you spend on driving to and fro. 280 miles is quite a lot of driving, time-wise. Just lost an order which I believe was due to me calculating in 4-6 hours of driving in total on a job which would max 1 hour on site.

 

[Kristina Fowler]

Hi,
On the side of this discussion I wonder how you price your such remote/distant jobs. I mean how much of the total cost you account for travel expenses and time you spend on driving to and fro. 280 miles is quite a lot of driving, time-wise. Just lost an order which I believe was due to me calculating in 4-6 hours of driving in total on a job which would max 1 hour on site.

I think the short answer is that you can't be all things to all people. I wouldn't pin the blame on yourself.

 

[R.Perry]

Hi,
On the side of this discussion I wonder how you price your such remote/distant jobs. I mean how much of the total cost you account for travel expenses and time you spend on driving to and fro. 280 miles is quite a lot of driving, time-wise. Just lost an order which I believe was due to me calculating in 4-6 hours of driving in total on a job which would max 1 hour on site.

In a situation where you have a lot of travel and short amount of time on site I would quote the job as a total price and not separate the travel and on site.

 

[Pawel]

In a situation where you have a lot of travel and short amount of time on site I would quote the job as a total price and not separate the travel and on site.

Thx.
This is what I did in fact including processing multispectral imagery, plot digitalization, veg indices calculation and statistics etc. I am afraid that additional cost such as mileage, travelling time etc. for remote destinations are too big to make small jobs sellable.

 

[R.Perry]

I don't know what you mean by small jobs but whatever the job is, if it doesn't pay enough to make a decent profit, don't waste your time.
Example, I have two monthly contracts, one in Davis, the other in Sacramento, (fairly close to each other) . I combine the two but charge each as if they were the only client in that area. Also many times I need to pick up supplies in the Sacramento area so it is a win win, all the way around.
I have lost jobs because someone under bid me, and that is understandable and will happen to everyone. I just refuse to work where I can't make a decent profit.
In one sense if someone is expecting to make a living by just doing drone work, well my advice is, don't quite your day job.
One of the companies I contact to is Multivista, reality is a very small part of their work is aerial photography, most of it is ground photography of construction projects.

 

[AheadAir]

I charge travel as a line item for anything beyond my local area. I've nudged that charge upward for new clients, but I'm holding the line with my regulars.

 

[Pawel]

I don't know what you mean by small jobs but whatever the job is, if it doesn't pay enough to make a decent profit, don't waste your time.
Example, I have two monthly contracts, one in Davis, the other in Sacramento, (fairly close to each other) . I combine the two but charge each as if they were the only client in that area. Also many times I need to pick up supplies in the Sacramento area so it is a win win, all the way around.
I have lost jobs because someone under bid me, and that is understandable and will happen to everyone. I just refuse to work where I can't make a decent profit.
In one sense if someone is expecting to make a living by just doing drone work, well my advice is, don't quite your day job.
One of the companies I contact to is Multivista, reality is a very small part of their work is aerial photography, most of it is ground photography of construction projects.

Appreciate your comments.
Talking about a small job - this particular job was to fly 40 trial plots covering +/- 8 acres using multispec camera. A trial of that size is easy to be scouted from a ground and will not consume a lot of time contrary to a one which would consist of hundreds or more plots. Yet multispectral analysis deliveres valuable data and insight to what is going on. In the latter case ( '00 and or '000 of plots) it would take long, long hours to collect measurements making it not feasable unless one uses e.g. a drone . In the first instance, where a site is far away from my base, big overhead costs (travel time cost, fuel etc.) make people reconsider getting their boots down on the ground. And make visual inspection.
Unfortunately there are not too many big trial sites here in Poland. And furthermore potential customers build their own drone forces ...

 

[Chicagolanddroneflyer]

I will be doing the same as any of the service providers in my area, as long as gas is over $4.00 a gallon, I will add a 2% fuel surcharge on the bill.

 

[GFields]

I have adjusted my prices to meet the rising cost of fuel. Most of my clients realize the situation.

 

[Chicagolanddroneflyer]

My vehicle uses premium fuel which in the Chicago area has come down it is still over $6.00 a gallon.