How is Acertus adapting to the current gas price crisis?
Transcript
Chas : I guess my question for you would be like, you know, if I’m a driver going across the country, and I’m seeing the gas prices vary anywhere from five to $8 per gallon for diesel or gasoline? What kind of challenges does that pose for you? How do you guys factor that into your structure? Whether it be pricing or, you know, operations expenses? How do you guys factor that into your contracts? And, you know, even in this market, what benefits do you guys offer?n
nTrent : There’s two ways to look at that from a contract or customer perspective, fuel surcharge programs. So there’s fuel surcharge surcharge programs used throughout the industry. And that’s a scaled approach. So as fuel as the DoD averages increase could be regional or could be national fuel averages, as those increase, so do your fuel surcharges. So long story short is a pass through cost. If it’s a spot market, you’re working with flat rates, you’ve got to continually be in communication with that customer so that they understand and most importantly, is providing them the data back that says, look, here’s what the market trends are showing, it’s not that, that I am just arbitrarily choosing these prices. It’s what the market demands, and that function obviously has costs associated and supply and demand. n
nSo trying to provide that back through data analytics is core to what we had a service do. And then the other side is really the carrier side, which is obviously more concerned with me and like I said, I grew up at a major carrier and managed them and drove in trucks and understood that that cash flow is important to them. You mentioned it if you’ve got 150 gallon saddles on the side of your truck, and you’re filling up 300 gallons of fuel, that is a big cost pressure on you. n
nSo what we’ve instituted is next day pay and trying to get their cash flow increased and get them their cash flow positive, even before they get into any trouble. So, you know, there’s a lot of things that we’re doing out there and the industry has challenged and the more that we can get up there and, you know, whether it’s through, you know, obviously voting and and looking at the administration and how do we curb some of these fuel prices, really for these carriers out there because that’s who’s that’s that’s who’s challenged the most much more than you and I in our in our, you know, vehiclesn
nTrent : There’s two ways to look at that from a contract or customer perspective, fuel surcharge programs. So there’s fuel surcharge surcharge programs used throughout the industry. And that’s a scaled approach. So as fuel as the DoD averages increase could be regional or could be national fuel averages, as those increase, so do your fuel surcharges. So long story short is a pass through cost. If it’s a spot market, you’re working with flat rates, you’ve got to continually be in communication with that customer so that they understand and most importantly, is providing them the data back that says, look, here’s what the market trends are showing, it’s not that, that I am just arbitrarily choosing these prices. It’s what the market demands, and that function obviously has costs associated and supply and demand. n
nSo trying to provide that back through data analytics is core to what we had a service do. And then the other side is really the carrier side, which is obviously more concerned with me and like I said, I grew up at a major carrier and managed them and drove in trucks and understood that that cash flow is important to them. You mentioned it if you’ve got 150 gallon saddles on the side of your truck, and you’re filling up 300 gallons of fuel, that is a big cost pressure on you. n
nSo what we’ve instituted is next day pay and trying to get their cash flow increased and get them their cash flow positive, even before they get into any trouble. So, you know, there’s a lot of things that we’re doing out there and the industry has challenged and the more that we can get up there and, you know, whether it’s through, you know, obviously voting and and looking at the administration and how do we curb some of these fuel prices, really for these carriers out there because that’s who’s that’s that’s who’s challenged the most much more than you and I in our in our, you know, vehiclesn