Fuel is one of those costs that many suppliers still struggle to handle cleanly in quotes. Diesel prices move faster than most pricing processes, sales teams are under pressure to respond quickly, and spreadsheets rarely keep up.
All of this leads to fuel surcharges applied inconsistently, explained awkwardly to customers, or missed entirely until margins start slipping.
In this blog, we’ll explain how fuel surcharges actually work in concrete pricing, why they matter more than ever, and how to calculate and manage them with Slabstack without slowing down your quoting process.
If fuel volatility has been quietly eating into your profit per yard, this will help you regain control.
What is a fuel surcharge in concrete pricing?
A fuel surcharge is an additional charge applied to a quote to account for fluctuations in fuel prices, typically diesel. It exists to help suppliers recover changing transportation and operating costs without constantly revising their base prices.
That means, rather than locking fuel assumptions into the material price itself, the surcharge allows concrete suppliers to adjust pricing as fuel costs rise or fall, while keeping core pricing structures stable.
Let’s understand why paying attention to fuel surcharge is so important for concrete suppliers.
| Key takeaways Fuel surcharge is an additional charge applied to a quote to account for fluctuations in fuel prices, typically diesel. It helps suppliers recover changing transportation and operating costs without constantly revising their base prices. Fuel surcharges are usually calculated using a baseline fuel price, a distance- or volume-based charge, or a regional fuel index that adjusts pricing as fuel costs change. However, fuel surcharges break down when suppliers rely on outdated updates, allow overrides, apply inconsistent rules, and forget to refresh existing quotes. Slabstack helps you manage fuel surcharges by pulling live fuel costs into every quote and applying the same surcharge rules automatically across all reps and plants. |
Why fuel surcharges matter for concrete suppliers
In concrete operations, fuel is required for mixer trucks, yard equipment, loaders, and trucks that move materials between plants and jobsites. As the delivery radius increases, fuel becomes a larger portion of the delivered cost per yard. When diesel prices move, even modestly, the impact compounds across dozens of daily loads. Moreover:
- Most concrete suppliers operate on narrow EBITDA margins, where a few dollars per yard can determine whether a job is profitable.
- Fuel is one of the most volatile inputs in the entire cost stack, yet it’s often managed with monthly updates or static assumptions.
Which means a quote written today may still be delivering months from now, long after diesel prices have shifted. Without a fuel surcharge that reflects real costs, every load delivered during a fuel upswing impacts your margins.
What makes this dangerous is how quietly it happens.
There’s no single moment where the margin disappears. Instead, profit per yard erodes load by load, often unnoticed until the project is complete and the numbers are reviewed. And this usually happens because of the traditional ways suppliers calculate fuel surcharges, if they do.
How to calculate fuel surcharge in the construction supply industry: 3 ways
Here are 3 common ways to calculate fuel surcharges in the construction supply industry.
Base fuel price + variable adjustment
Suppliers set a reference diesel price, often tied to a historical or budgeted average, and apply a surcharge when current prices rise above that baseline.
For example, a supplier may assume $4.00 per gallon diesel in their base pricing and add a $1.50 per cubic yard surcharge when regional prices rise to $4.50. As fuel drops back toward the baseline, the surcharge is reduced or removed.
Per-mile or per-yard surcharge
Another method is a per-mile or per-yard surcharge. This ties fuel cost directly to delivery distance or volume, which works well for operations with clearly defined delivery zones.
For instance, deliveries within 10 miles may carry a $0.75 per yard fuel charge, while jobsites 20–30 miles away include a $2.00 per yard surcharge to reflect higher fuel consumption.
Indexed to regional diesel averages
Some suppliers index fuel surcharges to regional diesel averages published weekly. In this model, the surcharge automatically adjusts based on a public index, such as adding $0.50 per yard for every $0.25 increase in the regional diesel average above a set threshold. This creates an external reference point that removes guesswork and provides credibility when customers ask for justification.
Across all these methods we’ve discussed, the key is consistency.
Customers can adapt to almost any structure if it’s applied the same way across concrete quotes, plants, and sales reps. Problems arise when different logic is used in different places, which is one of the most common mistakes suppliers make.
Common mistakes suppliers make with fuel surcharge calculation
Some of the common fuel surcharge calculation mistakes suppliers make include:
- Updating fuel rates monthly while diesel prices change weekly, or even daily. By the time you refresh the spreadsheets, the numbers are already lagging behind reality. That delay turns fuel surcharges into a rough estimate rather than a true cost pass-through.
- Another challenge comes from sales reps overriding or removing surcharges to close deals quickly. Without clear guardrails, short-term decisions made under pressure can undermine margin discipline across the business.
- If you run multi-plant operations, you may be applying different surcharge logic to different locations. What looks like flexibility internally often creates confusion externally when customers receive inconsistent pricing explanations.
- Lastly, many suppliers also forget to update existing quotes. New quotes may reflect current fuel costs, while older ones continue circulating with outdated assumptions, creating exposure once those jobs convert.
We’ll discuss how you can avoid these mistakes, manage costs, and send accurate quotes to your customers, but first, let’s go over how to explain fuel surcharges to customers so it doesn’t create friction in your customer management process.
How to explain fuel surcharges to customers
To explain fuel surcharges to customers, communicate transparently. When customers understand that fuel is a variable input, separate from the material itself, fuel surcharges make more sense.
- Breaking out material price and fuel variability shows that you are not arbitrarily changing prices, but responding to real cost movement.
- Setting expectations up front is also critical. Include fuel surcharge language directly in quotes to avoid surprises later and reduce uncomfortable conversations when prices shift mid-project. The suppliers we talk to mention that customers are far more receptive when adjustments are clearly outlined from the start.
- And finally, focus on your positioning. Fuel surcharges can be framed as protection against sudden price hikes later in the job. Instead of reopening entire pricing discussions, the surcharge provides a controlled, predictable mechanism to handle volatility.
At its core, clear communication is what matters the most. But you can only communicate clearly when your team is fully aware of the changing fuel prices themselves. Here’s how to manage that.
3 ways to manage fuel surcharges and quote accuracy in volatile markets
Construction material prices are volatile, including fuel. Here are 3 ways to manage this volatility while keeping your margins intact.
Set a clear fuel review cadence and stick to it
Even if you’re not updating prices daily, reviewing diesel costs weekly creates discipline. The best way is to assign ownership to one member or team to update fuel assumptions and communicate changes internally. This way, only one person or team is responsible for the task of updating prices, and sales reps are never guessing which numbers to use.
Separate fuel from base material pricing in every quote
Keeping fuel as a visible, standalone line item makes it easier to adjust without renegotiating the entire quote. It also reduces friction internally, since updates can be applied consistently across open quotes and projects without rewriting core pricing.
Define non-negotiable fuel rules for sales teams
Finally, set clear boundaries around when fuel surcharges apply and when they can be adjusted. This removes case-by-case decision-making under pressure and ensures fuel volatility is handled the same way across reps, plants, and customers.
Together, these practices can help you manage fuel volatility and apply fuel surcharge correctly. But most of these practices still require manual work, and even updating prices weekly can affect your margins. That’s where Slabstack helps.
Managing fuel surcharges without slowing down quoting with Slabstack
Slabstack is a sales and pricing software for concrete, aggregates, and asphalt producers that helps you turn fuel pricing into a built‑in part of how you quote, not another step your team has to remember.
Instead of relying on spreadsheets with fragile formulas, Slabstack enables suppliers to manage fuel surcharges through clear, centralized rules.
With Slabstack, you can:
- Pull live fuel and delivery cost inputs directly into your quotes, so pricing reflects current conditions.
- Apply the same fuel surcharge rules across all sales reps and locations, without manual overrides.
- Update fuel assumptions in one place and have them flow automatically into new quotes.
- Keep fuel visible as a separate line item, making it easier to explain and adjust when prices change.
Slabstack helps you protect margin without slowing down sales, quote faster, stay aligned with your team, and apply fuel surcharges that reflect real fuel costs as they change.
Fuel volatility is not going away, and neither is the pressure to quote fast and competitively. The suppliers who handle fuel surcharges well are the ones who treat them as a core part of pricing, not a manual adjustment on the side.
Reach out to our experts to see how Slabstack can help you quote accurately by applying the correct fuel surcharges.
Fuel surcharge for concrete quotes: Common FAQs
1. How is the fuel surcharge calculated?
Fuel surcharge is calculated by comparing current fuel prices to a baseline fuel price and adding a charge when fuel exceeds that baseline.
2. How to figure out the fuel surcharge?
To figure out a fuel surcharge, you look at today’s diesel cost, measure how much fuel impacts delivery, and apply a consistent adjustment to your quotes.
3. How do I calculate fuel surcharge?
To calculate fuel surcharge, set a reference diesel price and increase or decrease the surcharge as fuel prices move above or below that level.
4. What is fuel surcharge in trucking?
In concrete trucking, a fuel surcharge is an extra charge added to cover changes in diesel costs required to transport materials to the jobsite.
5. How does fuel surcharge work?
Fuel surcharge works by separating fuel costs from base pricing, so quotes adjust automatically as fuel prices change.
6. Are fuel surcharges legal?
Yes, fuel surcharges are legal as long as they are disclosed clearly and applied consistently in contracts and quotes.
7. How to negotiate fuel surcharge?
You can negotiate fuel surcharge by explaining it as a variable cost tied to diesel prices and agreeing upfront on how and when it adjusts.
8. How often should fuel surcharges be updated?
Fuel surcharges should be updated at least weekly, since diesel prices can change faster than monthly pricing cycles.
9. Is fuel surcharge based on miles or cubic yards?
Fuel surcharge can be based on miles or cubic yards, depending on how your operation tracks delivery distance and fuel usage.
10. How do you explain fuel surcharge to concrete customers?
To explain fuel surcharge to a customer, start by showing fuel as a separate, variable cost tied to diesel prices, not as a markup on concrete material.
