I've been writing recently about locking in prices (gas prices and postage rates), but there is an opposite phenomenon that haunts Buyers - the dreaded surcharge!
The most popular type of surcharge at the moment is probably fuel surcharges due to the ridiculous gas prices plaguing us.
As a Buyer, I have dealt with transportation services and seen those fuel surcharges severely affect the bottom line. Surcharges are a reality and a nuisance in many commodities/services besides the obvious and first hit transportation industry.
Of course, since most other industries are reliant upon transportation somewhere in their supply chain, they build surcharges into the contracts if gas prices spike or increase. (Interestingly, nobody ever wants to talk about a discount in rates if gas prices suddenly drop below the original baseline.)
I've dealt with vendors who supplied a company high end office binders. Since they are made from vinyl, which itself is made from oil, you can believe that there were surcharges built into that contract too. Plastic in items or packaging is another hard hit area.
What other surcharges have you seen in contracts and more importantly, how have you helped combat them in negotiations?
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