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Fuel Price fluctuations- how to address in transport agreement
Inder Pal Singh
Asked 7 months ago
Hello Team,Need your help in understanding the process to be followed to address the pricing issue in transport agreement when we are facing price Fluctuation on daily basis. Do we have some formula which can help in appapproving vendor inoicesRegardsI p singh
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Pankaj Arora
Answered 7 months ago
Fuel price for any particular date can be checkedchecked online for verification.
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Prabhat Ranjan Parashar
Answered 7 months ago
Dear Inder,As we all know that the fuel prices are no more governed by authoritirs , instead it"s free from subsidy years back had been linked to international crude prices, leading to daily fluctuations in price.Coming to you question where it"s required to be regualted in transportation eco-system through contractua governance. First we would have to arrive on figure as while fixing up the commercials what percentage of fuel components have been taken in to consideration. Once arrived you can drill it down as what is rate change ratio on unit level e.g rate impact per INR fuel price hike or slash.Accordingly a fuel escalation table can be prepared in a range of INR 50 to 100 taking current fuel price as break even and rates can be liked to it.There are different organisations dealing with this basis daily rate change, weekly, fortnightly and monthly Or may be a culumunative change percentage of 5% hike or slash in fuel rates. It"s purely dependent on your organization and suppliers amicable working and vested tolerance level.You may refer www.mypetrolprice.com as to benchmark city specific updated fuel prices.Trust this helps as tired to explain logic instead sharing excel template as not to infringe someone"s IP rights.Should you require further clarity please feelnfree to write people.mobility@outlook.com
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Prabhat Ranjan Parashar
Answered 7 months ago
Dear Inder,As we all know that the fuel prices are no more governed by authoritirs , instead it"s free from subsidy years back had been linked to international crude prices, leading to daily fluctuations in price.Coming to you question where it"s required to be regualted in transportation eco-system through contractua governance. First we would have to arrive on figure as while fixing up the commercials what percentage of fuel components have been taken in to consideration. Once arrived you can drill it down as what is rate change ratio on unit level e.g rate impact per INR fuel price hike or slash.Accordingly a fuel escalation table can be prepared in a range of INR 50 to 100 taking current fuel price as break even and rates can be liked to it.There are different organisations dealing with this basis daily rate change, weekly, fortnightly and monthly Or may be a culumunative change percentage of 5% hike or slash in fuel rates. It"s purely dependent on your organization and suppliers amicable working and vested tolerance level.You may refer www.mypetrolprice.com as to benchmark city specific updated fuel prices.Trust this helps as tired to explain logic instead sharing excel template as not to infringe someone"s IP rights.Should you require further clarity please feelnfree to write people.mobility@outlook.com
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