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Contract options
Page 57
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• Pence per milehdlometre contract The manufacturer is contracted by the customer to manage the tyre based on the annual mileage: this is provided by the customer with his fleet list. A pence per mile/kilometre to maintain the tyre on a specific vehicle will then be agreed.
• Capped cost contract: A contract is made with the customer so the level of expenditure (the cap), based on the fleet profile and estimated mileage, will not exceed an agreed level. If costs exceed the agreed rate the operator is not liable. But if the amount invoiced is below the agreed cost then this will be the amount paid.
• Fixed price contract: A fixed price is agreed for all work and service carried out over the agreed period. Unlike a capped cost the amount will not vary depending on the work if below the agreed amount. These should only be considered when the fleet composition is stable. For example, you do not want to quote a price for 4x2 tractors and then find six months later they have been replaced by 6x2s, • Tailored contract: The customer has based the contract on his specific needs (see 'Elements of tyre management", page 56), so costs can vary in line with the level of service required.