The Raise You Never Took

Somewhere in your office there's a signed hauling agreement with a sentence you fought for. It reads something like: rates shall increase four percent on each anniversary of the effective date. You remember the fight because the customer's side wanted a flat three years, and you traded for it. Maybe you held year one at the old rate to get the bumps. Maybe you gave up the fuel surcharge reset, or agreed to keep two trucks committed through winter.

Here's the question that sentence can't answer from inside a filing cabinet: did anyone key the new rate when the anniversary came?

Pull an invoice from this month and check it against the contract's rate table. If you're in year two or three of the agreement and the number matches year one, you've found the strangest kind of leakage there is. Nothing is missing. Every load got a ticket and every invoice went out and got paid. The count is perfect. The price is just dead.

A price change needs an event

Watch how rates actually change in a billing office, any billing office in hauling, aggregates, or ag. Something happens, and the rate moves. Diesel spikes, so the surcharge gets reset. A customer complains, so the clerk pulls the quote and fixes the number. A new job gets bid, so a new rate gets keyed. Every rate change you can find in your system's history traces back to an event that forced it, usually an event with a phone call attached.

An escalator's event is a date. April 1 arrives, and nothing happens. No truck idles and no document lands on the keying desk demanding an answer. The only party with a reason to watch that date, your customer's accounts payable, has every reason not to mention it. The contract that grants the raise is in a drawer, and the rate file the clerk actually bills from was last touched the week the deal was signed. Those two documents never meet again unless a person carries one to the other.

And the person who would carry it doesn't exist. The owner who negotiated the four percent doesn't key rates. The clerk who keys rates has never read the contract, and shouldn't have to; the rate file is the system of record because that's the whole point of a rate file. The escalator belongs to everyone in the building, which is the standard arrangement for things that get missed.

Compounding works against you too

Put a number on a missed anniversary, then swap in your own. A haul rate of $4.60 a ton, 9,000 tons a month, and a four percent bump you didn't take is about 18 cents a ton, call it $1,650 a month, roughly $20,000 over the year. That's the easy arithmetic. The uglier arithmetic is what happens when year three's bump computes off the wrong base, because whoever finally catches the miss will raise the current rate by four percent, and the current rate is a year stale. The contract compounds. The rate file doesn't.

There are smaller fights buried in the clause, and the anniversary is the cheap time to have them. Four percent of what, exactly: the base haul rate alone, or the rate the surcharge calculates from? Simple or compounded? Anniversary of the effective date, or of the first load? Each of those questions costs a two-minute conversation in April of year one. Left alone, they come due all at once, attached to a dollar figure big enough to argue about.

The raise expires in practice

The part worth disagreeing with: a missed escalator mostly can't be collected later, even though the contract says otherwise, and plenty of owners will insist they'd just back-bill it. Try the conversation. You notice in month nineteen. The contract plainly owes you seven months of the higher rate, maybe $11,000. Now you're drafting a letter asking your steadiest customer for a five-figure check for work he already paid for, invoiced by you, at a price you set. His AP manager never flagged the undercharge because AP departments audit in one direction. Most owners read that letter back to themselves and quietly waive the arrears, take the raise going forward, and tell nobody. The clause was airtight. It expired anyway, a month at a time, every month it went unnoticed.

Which means the concession you traded for it was free. The customer got the flat year one, the surcharge terms, the committed trucks. You got a sentence in a drawer.

flowchart TD
  A["Ticket: 23.6 tons hauled, April 2, year two"] --> B{"What prices it?"}
  B -- "the rate file, keyed at signing" --> C["Billed at $4.60, the year-one rate"]
  C --> D["Invoice adds up perfectly and runs short"]
  B -- "a rule with effective dates" --> E["Year-two rate live as of April 1: $4.78"]
  E --> F["A ticket billing $4.60 gets flagged that day"]

Key all three years on signing day

The fix costs twenty minutes, once, on the day the contract is signed, while the person who negotiated it still remembers what it says. The rate table has three lines and three dates. Key all of them, with their effective dates, so the raise becomes something the billing runs into instead of something a human has to remember. April 1 stops being a Tuesday and starts being the day the old rate stops clearing.

This is what billing rules with effective dates are for, and it's a slice of what Termco builds. The contract's rates get structured as rules, dated through year three. Which accounts ride which agreement is reference data. Tickets get digitized daily, as written, and a ticket billing a rate that died on the anniversary gets flagged as non-compliant that day, not discovered in month nineteen. Invoice totals assemble from tickets that cleared. Nothing changes in the cab or at the scale window; the drivers and the carbon books never hear about any of it. The rates just stop living only in the contract.

Read the drawer

The audit is an evening with a highlighter. Pull every multi-year agreement you've signed, supply and haul both, and list each escalation date that has already passed. For each date, find an invoice from the following month and compare the rate to the contract's table. Write the gap in dollars per month next to each miss. While you're in the drawer, do the mirror check on the contracts where you're the customer, because your vendors miss their escalators too, and the ones who didn't may have compounded off a base you never agreed to.

If you want a second set of eyes on the paper that feeds those invoices, send 10-20 sample tickets to hi@termco.ai and findings come back within 48 hours.

The four percent was never a future favor the customer might do you. It was consideration, paid for at the table with things you gave up. Collecting it on time is the second half of a trade you already made.