Negotiating Rates with Affiliates

Posted on October 19, 2011 by - Also by this author

Do you negotiate on farm-in and farm-out jobs?
It seems that every day we get a call from some affiliate asking what we can do about the price. I hate this question! Can you negotiate on the price you pay at the pump today? Can you negotiate with the power company on how much energy you use today? I would say the answer is a resounding NO!
If you are in a true relationship with a network or an affiliate, usually there is a document drawn up in the beginning of the relationship outlining the charges for different types of vehicles. I like to think that the prices we set are fair and reasonable for the work being performed and the type of vehicle provided. The agreed upon rates are then loaded into our computer in the client profile, and as far as I am concerned, that should be the end of any pricing discussion.
When I farm an order out, I always assume that the price being quoted to me is the price the affiliate feels they need to charge to deliver the service I am asking for and allow them to make a fair and reasonable profit. I do believe that is what the game of business is all about. I don’t ask for deals. I don’t ask for discounts. I assume that when we entered the relationship that an affiliate provided me with the best rate they were able to provide.
Yet, I have large networks that call all the time and ask things like, “Is this the best you can do?” “Can you give me a flat rate of $XX.XX?” I always ask, “Do you have a copy of our agreed upon rates?” I mean, seriously, if you have a copy of the rates I provided, why are you even asking for a price? I gave you the price when we first started doing business.
I suppose since I am on the receiving end of the question and not the one asking the question maybe I am wrong in my way of thinking that everything in life should be negotiable. I don’t even know why we have an established rate sheet. Maybe we should just start asking people what they think is a fair and reasonable price and go from there.

-- Jim Luff, LCT contributing editor

View comments or post a comment on this story. (0 Comments)

More LCT Blog Blog Posts

March 8, 2017

Immigration Issues Can Hit Limo Operators

Illegal or not, immigrants in one California region spend hard-earned money on renting stretch limousines.

March 1, 2017

Did The Dent Fairy Come To Visit You?

Unlike the tooth fairy and baby teeth, the dent fairy never runs out of vehicles.

February 15, 2017

My Unofficial International LCT Show Agenda

The suite parties, charity fundraisers, and off-the-grid get togethers round out a complete global industry trade show.

February 14, 2017

How To Practice Common Sense Customer Service

It's one of the most important and difficult qualities to hire for, since it emerges in unexpected situations on the job.

February 1, 2017

3 Big Fouls From My First Uber Rides

Operators don't have much to worry about if TNC drivers keep acting like this.

See More

Facebook Comments ()

Comments (0)

Post a Comment



See More

LCT Store

LCT Magazine - June/Fact Book 2017 $12.95 * Facts & Stats * Directors & Guides *


Experience the three annual industry events for networking for business, showcasing vehicles and products, and getting the tools for success.

Read About Your Region

What’s Happening Near You?
Click on any state to see the latest industry news and events in that region.

More From The World's Largest Fleet Publisher

Automotive Fleet

The Car and truck fleet and leasing management magazine

Business Fleet

managing 10-50 company vehicles

Fleet Financials

Executive vehicle management

Government Fleet

managing public sector vehicles & equipment


Work Truck Magazine

The number 1 resource for vocational truck fleets

Metro Magazine

Serving the bus and passenger rail industries for more than a century

Schoolbus Fleet

Serving school transportation professionals in the U.S. and Canada

Please sign in or register to .    Close