What you bill for, HOW & "Industry Standards"

[DodgeTowGuy134]

What you bill for, HOW & "Industry Standards"

 

We're all aware that from time to time we experience "push-back" or questioning of what/how much we charge for any giver service/item. Sometimes we also hear the term "Industry Standard" tossed around, but what does it actually mean, how is it implemented and how does it relate to what items/services you bill for? 

First, lets all agree that we each determine the rates that we are going to work for, the types and levels of services we will provide and the rates for such items and services. Additionally, we should set our rates based upon OUR individual costs of doing business, plus what our determined profit margin will be. ***We should NOT be pricing our services nor competing with ANYONE else by means of being the LOWEST price!*** In doing so, we only serve to cut the throat of our own industry as a whole, which causes depressed market rates that can quickly spread if everyone is still competing on the far outdated thought of being the lowest price. We SHOULD bill what our services are WORTH, and as based upon our costs and profit margin to arrive at our final rate that we charge. 

Second, our industry had long "given away free services" by way of simply not being aware that we can bill for something. Consider this: A sawmill once gave away the sawdust generated because they though of it as trash and didn't see value in it as having any worth, especially if the sawmill had to they pay for disposal. But that very sawdust does have tremendous value! Ranging from bedding material in a horse barn to the sawdust being mixed with other components and pressed into form as a "fire starter log"; there IS value if you stop and think! The same goes for the excess "trim" wood that comes off the sides when they mill the tree down into lumber. Those outside/rounded pieces of wood can then be resold as "siding/roofing" for use to give the appearance of a log home or used on a room or inside an interior room to give that warm look and feeling of a log home. I could go on with this example, but I believe you see what I'm getting at! 

As for our industry: Do you know, are you aware of all the items and services that you "give away" and don't charge for? And why does this matter and how does it relate to "Industry Standards"? 

Industry Standards arise out of the understanding by the majority that a certain task item, method or otherwise is an acceptable practice and is collectively agreed upon as "the norm". This matters, because it's one way our industry had remained in the past and how we've been manipulated by other industries, such as the insurance and motor club markets, because we lack a collective "industry standard". While we do have specifics, such as methods of training (WreckMaster for example) we still widely lack any industry standards when it comes to: WHAT we bill for, HOW we bill for it and HOW we explain it! This not only affects the heavy tow & recovery, but also all the way down to the light-duty tow or roadside assistance call! 

As there any additional special equipment that you (your company) decided to invest in purchasing, so that you'd have it available if needed to assist a customer? I'm specifically meaning items that if you think about how many others in YOUR local service area also carry the same items; these items are additional special equipment; Why do you NOT bill for their use?! You invested in the purchase of those items, so why not bill for their use and get the Return on Your Investment for the ITEM Usage and not just for the collective of "being able to get the job/tow done" as that's an outdated method of thinking and is costing you $$$ from capturing these revenues.

 

Let me set out a few examples for light-duty tow & roadside:  (in no particular order and please note that I used links to Zip's/AW since they are our largest industry supplier)

 

• Euro wheel stud extenders (https://zips.com/parts-detail/access-tools-6-pack-wheel-bullets-act-wb6) The proper alignment and mounting of a euro style tire in important to safe operation after the tire change and is compounded by the needed speed and efficiency in performing the tire change task when working roadside. The use of euro stud extenders case help speed the alignment; why don't you bill for their use if you have them?
• Lugnut Extractor Sockets (https://zips.com/parts-detail/access-tools-easy-off-twist-socket-set-act-eo) If the customer has a rounded lugnut and you use these extractors in order to get the tire change completed, why don't you bill for the use of this additional special equipment? If you didn't invest in having these, then you wouldn't have been able to complete the tire change.
• Safety Seal Tire Plugs (https://zips.com/shop-by-brand/safety-tire-seal-corp#%5B%22customCategory%7CSafety%20Tire%20Seal%20Corp%22%5D) Customer has a flat tire and no spare or maybe just a bottle of "fix-a-flat" that's not working to seal the hole from a nail in a tire. If you plug the tire for the customer to save them the hassle of a tow and wait at a tire shop, why not bill for the "flat repair service" and the use of this additional special equipment?
• Endless Loop Round Slings (https://zips.com/parts-detail/zip's-endless-loop-round-slings-zips-roundsling) these are an item that takes wear and tear at a higher rate than solid metal rigging; the use of this equipment should dictate billing for its usage when warranted and to pay for its replacement.
• Tow Dollies (https://zips.com/parts-detail/collins-dolly-set-zinc-plated-w-aluminu-sl-480ad) With the use of tow dollies, it's typical to bill a line item for the dollies (as an equipment charge), but why do you not also bill for a per-mile fee? The additional mileage and wear/tear on the dolly bearings and tires should warrant also billing per-mile for their usage. Also, what about the labor/time for the installation/removal of the dollies? Why not bill for this extra labor time, the dollies don't put themselves on!
• GoJacks (https://zips.com/parts-detail/gojak-dollies-gojakdollies) the use of GoJacks to assist with movement of a vehicle form a tight location can determine if you do a job or not and they do suffer from wear and tear. Additionally, not all tow companies carry these and are still considered additional special equipment.
• Skates (https://zips.com/products/towing-accessories/car-carrier-supply#%5B%22department%7CTowing%20Accessories%22%2C%22category%7CCar%20Carrier%20Supply%22%5D) The use of various types of skates to assist with the movement of a vehicle constitute an additional special equipment fee
• Ice Claw/Anchor Spade (https://zips.com/parts-detail/aw-direct-ice-claw-awd-ic -or- https://zips.com/parts-detail/zip's-holmes-wheel-lift-anchor-spade-wlsb-1k) The ability to anchor your truck down to prevent sliding on an icy/snow covered road, gravel or during a heavy pull sometimes requires the usage of some form of anchor spade and could be additional special equipment that could be an additional billable charge.
• Snatch Blocks (https://zips.com/snatch-blocks) Although this is considered a "hard rigging" item, its use does incur wear and will need replacement sooner than other hard rigging items, especially if you're using blocks with the bronze bushing as compared to a block with bearings.
• Winch Line Extensions, especially Synthetic (https://zips.com/products/winch-lines-hardware/synthetic-winch-rope#%5B%22department%7CWinch%20Lines%20%26%20Hardware%20%22%2C%22category%7CSynthetic%20Winch%20Rope%22%5D) Sometimes a winch line extension is needed to reach a vehicle for a recovery; this is yet again additional special equipment that not every tow company has available at the ready. These extensions are an item that is exposed to wear and will need eventual replacement; the higher costs of the synthetic versions would also support billing for their usage to recoup your costs.
• Fluid/Spill cleanup (https://zips.com/parts-detail/spill-tackle-fluid-absorbent-20-lb-bag-st20b1-kit) the cost for absorbent, plus the labor can both be additional billable costs and are reasonable charges to bill for.
• Crash Wrap (https://zips.com/parts-detail/aw-direct-collision-crash-wrap-protect-film-acw) The usage of  crash wrap to help secure and protect a vehicle for additional weather exposure isn't part of the "standard equipment" that most carry and have available, plus its usage helps protect the vehicle for additional damages; billing for its use and replacement are reasonable charges
• Crash Cleanup Bags (https://trao.org/product/crashbags/) These bags or a thick/heavy-duty black trash bag can be used to contain the debris cleanup, including the small pieces of plastic from vehicle body parts to the absorbent and suspended fluids. This also allows you the ability to dropoff the "cleanup debris" with the vehicle at the tow destination, for them to dispose of, instead of hauling these debris items back to your shop and going into your dumpster, which could be an issue if vehicle fluids are suspended in the absorbent and classified as a hazardous waste that needs special disposal.
• Road Flares (https://zips.com/parts-detail/cortina-30-mininute-flares-pkg-of-36-flare-flx30) the use of these safety items are yet another overlooked billable item that needs restocked after use.

 

Now onto other additional fees that are often overlooked:

·        After-Hours Fees for services after your normal business hours

·        Holiday Fees for services on a federal holiday

·        Gate Fees for access to storage lot

·        PPE Fees for usage of consumable personal protective equipment

·        Battery Disconnect Fee or billable Labor item to disconnect a standard automotive battery after a vehicle crash

·        Battery acid neutralizer chemical for application and use when a standard vehicle battery is ruptured and spilled at a traffic crash

·        LABOR: This line item can encompass a lot of various actions and is another way to bill for service

·        Recovery Fee: This line item is typically billed when services are in excess of a basic winch, such an example would be if a light-duty vehicle is rolled over into onto it's side in a concrete storm drain

·        Pulling/Disconnecting the axle/linkage is another labor service item that could be billed as it's own line item, if not billed under the general "labor" line item

·        Tow Dolly Mileage Fee: as mentioned above, the billable mileage for the use of tow dollies to cover the wear of the dolly bearings and tires is a very common overlooked item that can be billed.

·        Standby/Wait time should be billed when you and your equipment are onsite for services, but waiting to be permitted to begin the necessary services at the site

 

This is just a brief list of some of the various items and services that could be billed. Are there any items or services that you bill for that aren't on the list above? or why do you not bill for any of the above?

[MTtow]

I agree with most of that. Personally I put skates, winch line and snatch blocks (especially when billing at recovery rates), and endless loops/slings in the “all part of the truck or all part of providing the service” billing category. 

 

A plumber sent me a bill recently. Every tool he used was itemized and it rubbed me the wrong way. Why should I pay a premium price for his time if I am also paying for every tool used. My perception was that his use of his tools was accounted for in his high hourly rate. 

 

I would hate for a customer to think I am nickel and diming them to death but at the same time don’t want to leave money on the table as they say.

 

The general public (for the most part) believes that everyone provides the same service and our rates are the only difference.

 

Thanks for sharing and bringing up this topic. I also would like to know what the general consensus as to what the industry standard is.

Edited January 21, 2022 by MTtow
Grammer

[Melville]

• 
• Member
• • 10

Posted January 21 (edited)

I too agree with most of that.  I put skates, winch line and snatch blocks (especially when billing at recovery rates), and endless loops/slings in the “all part of the truck or all part of providing the service” billing category. I never thought of dolly mileage, but that doesn't sound unreasonable, after all we (as a industry) calculate most towing by hook up and mileage, the hook up and mileage of dollys should be no different.

I would not bill for every tool utilized though, the public would not accept for example  freely charging for a floor jack, cordless impact, torque wrench and gloves , for changing a flat tire.

Consumables should either be line itemed or figured into tow/recovery rate, listing them separately is burdensome  and  can be construed as petty.

Specialty items should be billed, listed and detailed. I include dollys, go jaks, spades , wheel chocks,  chainsaws, winch extensions, etc...

[DodgeTowGuy134]

"Standard" items to do a job, such as for example in doing a tire change, the use of the jack, 4-way or cordless impact, air tank, etc would be billed as included in the line item pricing for doing that service of as tire change. 

 

Likewise, if you do a "jump-start/battery-boost" and your "standard" method is by using a "jump-box" then the use of the jump-box would be your standard line item price for the service, however, if you then need to turn around and connect jumper-cables and remain connected for 45-minutes in effort to actually "charge" the dead battery via power from your truck, then that would be billed as "battery charge time or labor" depending on what terminology you use. 

 

The use of fabric roundslings/endless-loop straps are considered a consumable item and have a high wear/tear ratio and thus a shorter life, so we bill for the use of those items, whereas if we use a metal (wire rope) roundsling, we consider it a "hard rigging item" and we bill for its use at a lower price point and along the rates for a snatch block. Comparably the actual "hard rigging" such as chain and shackles we consider as "standard equipment" and are included in the regular price/rate for the service, since we consider it as standard equipment that's part of the truck. 

 

We believe that billing line item for the use of special equipment and services is proper and isn't "nickel and diming"  as not every job/customer needs the same equipment and where the extras are used, then we bill accordingly for their use.