When was the last time you rented a car and you checked the fee? Were you assessed facility fees and recoup fees, local tax, city tax, state tax? Want to prepay your gas? (By the way bring it back on fumes if you want the value). If you forget to gas it up, you’re charged $4 something for the gas. Next we will be charged for vacuuming the car out.

 

So need a hotel room? There is local tax, city tax, state tax and perhaps a resort fee of X dollars. If you want Wi-Fi in your room, there’s a charge. Even if there’s a coffee machine in the room, you can bet there’s a hidden fee on your bill that covers that. Some hotels even charge $ 2.00 a day for the newspaper, unless you opt out. 

Now on repair shop invoices, a percentage for misc charges, waste disposal, oil disposal, EPA fee, environmental fee, nuts and bolts fees, rags, pictures and whatever else plus battery and tire disposal. All real costs associated with a shop, plus microscopic line item billing.

 

So why am I on a tirade? Well, a few weeks ago I went on a NRT tire scrap analysis inspection (scrap tire analysis is what I tell everyone they should do each month—check each and every tire). As we were inspecting each tire, looking at damage, abused side wall cuts and bruises, I was happy to see credits from the tire company for capping and casing for failures. Boy was I feeling good after looking at all of the damaged tires costs that go into our cost per mile (CPM).

 

We had a few new tires and a number of new fresh recap failed tires, so I was curious about the formula on the credit adjustments. I was told that it is prorated, and asked how that works? (I know its prorated by 32nds or casing value), I was told that on the new tires it is based on 32nds. But what does this new tire get, I asked. The answer was 16/32nds. Next I asked about the retread, and found out it was the same. How does this math work? The new tire is 23/32nds and the recap is 22/32nds having 22 on both respectively. So, what is a 32nd worth?

 

I was told that the retreader keeps a few 32nds on each credit for the administration and processing fees for the credit transaction. (There are those fees again.) So I said, here are my credit fees, tire mounted fee, tire dismounted fee, tire mounted (again) fee, plus truck mileage, air compressor fee, clean air fee, and miscellaneous charge, per tire—and I forgot environmental fees.

 

The bottom line is, check to see how it is calculated and what you are getting for adjustments, and credit value. Then ask yourself, are these fees related to profit and loss or are they all just greed?

 

For more information, visit www.darrystuart.com or email comments or questions to [email protected].