Ton 25,001

There's one sentence in your supply agreement doing more pricing work than the whole rate sheet. It reads something like: $14.50 per ton for the first 25,000 tons per contract year, $13.25 per ton thereafter. Sales likes it because it closed a 60,000-ton paving contractor without touching the price the small accounts pay. The contractor's buyer likes it because he knows he'll clear the threshold by July.

Now walk to the scale window and ask the one question the clause runs on: how many tons has this customer taken since January 1?

Nobody in the building knows. Not the scale operator, who sees one truck at a time. Not the billing clerk, who sees one week at a time. Somewhere in the contractor's office, though, a project accountant keeps a spreadsheet with a cell that answers it to the ticket. One side of this contract is counting. Guess which.

A price with a memory

One ticket, one billable event. Most billing rules read the event in front of them: this product, this customer, this date, this rate. A volume tier is a different animal. It prices today's ticket off the sum of every ticket the account has run since January 1. The rule has a memory, and nothing at the keying screen does.

So billing offices cope, and every coping method has the same shape: pick the version that avoids an argument today.

Some key tier one all year and plan a true-up at year end, a plan that holds right up until year end gets busy. Some key tier two from the first load, because sales said they'll hit the number anyway. That's $1.25 a ton on 25,000 tons, $31,250, handed over in January against a threshold that won't be earned before summer. And plenty flip the rate the day the customer calls to say we're past it, which hands the count to the one party who profits from running it hot.

Whose count is it

Say the contract year closes and the counts disagree, because they will. Your tickets say 24,400 tons. His spreadsheet says 25,900. Nobody's lying. His count includes the loads his crews pulled for a second job that bills under a sister LLC, plus two loads your office credited back after a rejection. A week in April got counted twice, because your invoice and his field tally overlapped. Whether those sister companies aggregate toward one threshold is a real contractual question, and if the answer doesn't live anywhere, it gets settled the way big stale numbers get settled: at the counter, in his favor, with the renewal sitting in the room.

The clause breeds a second ambiguity on top of the count. Does $13.25 apply to the tons after 25,000, or to every ton once the threshold clears? You read it prospective. He read it retroactive. Same one sentence, the same $31,250 apart, this time hiding in the grammar, and the disagreement stays invisible until the year's biggest account is also its angriest.

And the error only hurts in one direction. Flip the tier late and his accountant catches it inside a billing cycle, short-pays the difference, and attaches the spreadsheet. Flip it early and nothing happens, ever. No customer audits an invoice to report he's been undercharged since March. The late flip is a loud, bounded correction. The early flip runs silent at $1.25 a ton for as long as the mistake lives; carry it across 7,000 tons and that's $8,750 gone, with every invoice footing perfectly.

flowchart TD
  A["Ticket 5,187: 23.4 tons"] --> B{"What prices it?"}
  B -- "today" --> C["The rate the clerk keyed yesterday"]
  C --> D["Tier flips whenever somebody argues"]
  B -- "a rule with a running total" --> E["Account total to date: 24,968 tons"]
  E --> F["This ticket bills at tier one"]
  F --> G["The crossing ticket gets named and dated"]

Count it or don't sign it

Try this position on your sales manager: a volume tier you can't count live isn't a price. It's a coupon, and the customer decides when to redeem it. If the running total doesn't exist in your building, every operative number in that clause lives in his spreadsheet, and you've signed a contract whose central term is maintained by the other side.

Sales has a case, and it's not a weak one: tiers win exactly the big, competitive accounts, and a retroactive tier that re-prices the whole year is often the sweetener that closes. Fine. Sign the retro deal, but run it as a rebate: bill tier one on every ticket, all season, and settle the rebate once, in January, against a ticket count both sides watched all year. Money you billed and hold reconciles better than money you never invoiced. What can't survive is the usual middle arrangement, where the price flips mid-year on a count nobody keeps, which is what most of these clauses quietly become.

The total is tickets, added up

A running total isn't a spreadsheet project for somebody's spare Fridays. It's what a stack of digitized tickets already is.

The tier terms are billing rules: the threshold, both rates, prospective or retro, the contract-year dates. Which accounts aggregate toward one threshold, the parent, the sister LLC, the second job, is reference data, decided once when the contract is signed instead of discovered at year end. Tickets get digitized daily, each one reads against the live total, and the flip lands on a named ticket on a known date. That week you can send the one-line letter the whole clause deserves: ticket 5,204 crossed 25,000 tons on August 9, and your price is $13.25 from here. A ticket priced on the wrong side of the threshold gets flagged as non-compliant the day it's keyed, not argued about in January. Invoice totals assemble only from tickets that cleared.

That slice is what Termco builds: digitizing the tickets, flagging the ones that break a rule, structuring the billing rules, managing the reference data, assembling the totals. Where the threshold sits, whether the tier runs retro, and whether the sister LLC counts stay entirely your decisions. They just get made in the contract's own words, once, instead of renegotiated every time the counts drift apart.

Two dates that should match

Grading your exposure takes one afternoon. List every account with a volume term in its pricing. For each one, write down the year-to-date count you'd defend under oath, and the date the tier flipped or should flip. Then pull the invoices and find the date the rate actually changed. Accounts where those dates match, you're running. Accounts where you can't produce the count at all are being run from the other side of the scale.

If you'd rather have a second reader on it, send 10-20 sample tickets to hi@termco.ai, a run from a volume-tier account especially, and we'll send back what we find within 48 hours.