Navigating Volatility: How We Build Sustainable Logistics Partnerships

In recent years, the road transport industry has been deeply influenced by macroeconomic and geopolitical factors that have generated a structural increase in costs. In this context, a central concern in the market remains the same: how do we manage volatility in a fair and sustainable way? How can we plan budgets and operations when one of the most important cost elements – fuel – fluctuates unpredictably?

Moreover, the challenge is not only to understand the problem, but to identify viable long-term solutions. The answer does not lie in unilateral shock absorption, nor in tense negotiations at every price increase. The right direction is to build a framework based on transparency, predictability and, above all, real partnership.

In this context, it is essential to understand how prices can be adapted according to the cost of diesel and, more importantly, how we can contribute to educating the market to adopt a model in which all parties involved are protected and can operate profitably.

In times of stability, fixed-price contracts for 12 or 24 months offered comfortable predictability. In the current context, however, this model has become a high-stakes gamble for both the customer and the carrier.

If the price of diesel drops significantly, the customer ends up paying an overvalued rate, effectively subsidizing the carrier. This is an economically inefficient situation for the customer.

If the price of diesel increases explosively, the carrier is forced to operate at a loss. No company can sustain losses in the long term. The inevitable consequence is a degradation of service: delays, lack of investment in fleet and technology, or even refusal to take on the trips. In the end, it is the customer’s supply chain that suffers.

The fixed-price model encourages a transactional relationship, not a partnership. The real challenge is to create a mechanism that aligns the interests of both parties.

The solution we are implementing and actively promoting is the fuel surcharge clause.

Far from being a hidden fee, it is a transparent contractual instrument designed to share risk and ensure fairness.

Here is how it works, explained simply:

1. We set a Peg Price: At the start of the contract, we agree on a reference price for diesel (e.g. €1.50/litre). This is the neutral point. As long as the real price remains at this level, no adjustment is applied.
2. We choose a Public Benchmark: To eliminate any suspicion, we do not use our pump price. We refer to a public, transparent and neutral index, recognised at national or European level (e.g. the index published by the European Commission or national authorities). This way, both parties have access to the same information at the same time.
3. We Determine the Fuel Share:
   We recognize that diesel is only a part of the total cost of a transport (usually between 30% and 40%). The rest is represented by salaries, taxes, maintenance, insurance, etc. We contractually establish this share (e.g. 35%).
4. We Apply a Simple and Transparent Formula: The adjustment is calculated based on a clear formula. For example:

Surcharge (%) = [(Current Price Index - Base Price) / Base Price] x Fuel Share (35%)

This resulting percentage is then applied to the agreed transport tariff. Crucially, the mechanism works both ways. If the price of diesel falls below the base price, the customer benefits from a discount (a credit) on the transport invoice. It is a risk-sharing system, not a one-way street.

Introducing such a clause requires an open conversation. Our role, as a logistics service provider, is to educate our partners on the long-term benefits of this model.

The discussion is not about "how to increase prices", but about "how to ensure continuity and quality of service in a volatile market". When a customer understands this mechanism, they realize that the advantages are on their side:

• Total Transparency: They know exactly why and by how much the price is adjusted. There are no surprises or monthly negotiations.

• Guaranteed Fairness: They automatically benefit from price drops, ensuring that they always pay a fair rate, aligned with the reality of the market.

• Partner Sustainability: Most importantly, they ensure that their logistics partner remains financially healthy. A profitable carrier is a carrier that invests in safety, tracking technology, well-trained drivers and a modern fleet. A partner struggling to survive will always be a weak link in the supply chain.

A partnership only works if everyone is protected and can thrive. Insisting on unrealistic fixed prices in a volatile market means setting up your partner for failure and, by extension, risking major disruptions in your own supply chain.

At Crystal Logistics, we strongly believe that the future of logistics does not lie in rigid contracts, but in flexible partnerships based on trust and transparency. The fuel indexation clause is not just a technical tool, but a business philosophy. It is our commitment to share both the risks and the benefits, ensuring a smooth and predictable path for our customers’ goods, regardless of the storms in the energy market.

I invite all industry players ‒ both customers and carriers ‒ to adopt this approach. Only in this way can we build truly resilient supply chains, capable of meeting the challenges of tomorrow.