by Nathan Breier
Nathan Breier, the VP of Industry Solutions at Vixxo, brings a wealth of expertise to the table with over 12 years of experience in the industry. Embark on a journey with him as he shares his personal encounter with the discovery of unexpected hidden fees.
In facilities maintenance, trust and transparency form the bedrock of successful partnerships between service providers and clients. However, the prevalence of hidden fees often obscures this transparency, leaving clients with unexpected and unwelcome surprises. As we explore the landscape of hidden charges, let me share a personal example that echoes the challenges many of us face.
A Night to Remember:
New Year's Eve is a night filled with joy and celebration. My wife and I, joined by friends, welcomed the new year at a local restaurant in Batavia, IL. The atmosphere was perfect, the company delightful, and the evening promised to be unforgettable. As we enjoyed a fantastic meal and raised toasts, the mood took an unexpected turn when the bill arrived. A 5% charge labeled as a "kitchen administration fee" left us feeling duped on a night meant for celebration.
Hidden Fees in Maintenance:
Much like the surprise charge on that New Year's Eve bill, hidden fees in maintenance can catch clients off guard. Fuel surcharges, separate charges for consumables, rounding up of labor hours, and parts overcharging are common culprits contributing to obscured pricing structures.
Invoice Component Proportions - hidden fees can affect all major components
Hidden Fee #1: Fuel Surcharges
Initially introduced to offset rising costs, fuel surcharges can become a hidden burden for clients. With oil prices normalizing and even reducing, these fees are not necessary. The U.S. Energy of Information Administration expects U.S. gasoline prices to average around $3.40 per gallon (gal) in 2024 and $3.20/gal in 2025, compared with an average of more than $3.50/gal in 2023. It is imperative to ensure pricing is transparent by actively working to see that any fuel-related charges are justified.
Hidden Fee #2: Charging for Consumables
Traditionally, certain consumables were part of the cost of doing business. However, hidden fees may arise when service providers charge separately for these items. Some items to look for may include gloves, tape, and trash bags. It is important to look and identify such items to promote fair and transparent billing practices.
Hidden Fee #3: Rounding Up Labor Hours
The rounding up of labor hours on invoices can contribute to hidden costs. There should be a system in place to show if you are being billed for more time than is genuinely spent on maintenance tasks. This is an area that can hide large amounts of over-spending. In one customer, we found 60% of their invoices being billed at 60-minute increments, which led to $2.3M in overspending.
Hidden Fee #4: Overcharging on Parts
Parts overcharging is a common pitfall in the maintenance industry. I recently worked with a customer where despite clear agreements on parts markup, over 25% of their invoices included parts overcharges. There should be a clear validation of costs of parts, preventing overcharging, and ensuring fair pricing for every component.
In the complex landscape of facility maintenance, hidden fees can erode trust and strain client-service provider relationships. As you evaluate your invoices, consider the importance of a maintenance partner that prioritizes transparency.
Let's eliminate hidden fees from the equation and foster enduring partnerships built on trust and integrity.
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