Understanding Rate Factors | CLUE Learning

Not all equipment time costs the same. A machine actively working on a project carries full owning and operating costs. A machine sitting idle on site, waiting in the yard, or in transit carries a different cost structure. Rate Factors are the multipliers that determine how much of the base owning and operating rate applies depending on what the equipment is doing at any given time.

Each factor is made up of two values: an owning multiplier and an operating multiplier. These are applied against the base rate to calculate the actual daily charge. Working at 1.0/1.0 means full cost. In Yard at 0.5/0.0 means half the owning cost and no operating cost. The combination of status and multiplier ensures that charges accurately reflect real-world equipment activity.

Who Is This For?

• Equipment Managers use rate factors to ensure that internal charges to projects accurately reflect the cost of equipment based on its actual status each day.
• Finance and Billing Teams use rate factors to maintain consistent and defensible charge calculations across all projects, divisions, and locations. This connects to CLUE's fleet management where accurate cost allocation across the fleet is essential.
• Operations Leaders use location-level overrides to apply different factor values to specific divisions or projects when contractual requirements or operational conditions call for it.

How to Use It

1. View Rate Factors

Go to Rates > Rate Factors. The top of the page shows your factor definitions as color-coded cards. Below is a grid displaying the factor values for every project and location in your organization, making it easy to see the full picture at once.

2. Override Factors per Location

The grid allows you to set different owning and operating multiplier values for specific locations. Click any cell to change its value. For example, the Paving Division might use a Standby owning factor of 0.9 while the rest of the organization uses 0.8, reflecting a specific divisional agreement.

3. Create New Factors

Click on + to create a new rate factor. Set the factor code, name, owning multiplier, operating multiplier, and whether the factor is available for assignment to equipment on the Equipment Charge Timeline.

Filter by Type

Use the type filter to display only Owning Rate or Operating Rate columns in the grid. This simplifies the view when you are reviewing or editing one cost type at a time.

Key Behaviors and Limitations

• Factor math is straightforward. Daily charge = (Base owning rate x Owning factor) + (Base operating rate x Operating factor). This calculation applies to every charge block on the equipment charge timeline.
• Overrides are hierarchical. Set a default at the company level, override at the division level, and override again at the project level if needed. The most specific value always wins. A project-level override takes precedence over a division-level value, which takes precedence over the company default.
• Each factor has a color code. The color assigned to each factor carries through to the Equipment Charge Timeline, making it easy to identify equipment status at a glance without reading individual labels.
• Standard factors cover most situations. The default set of Working, Idle on Site, Standby, In Transit, In Maintenance, and In Yard handles the majority of equipment scenarios. New factors can be created but should only be added when a real operational or contractual need exists.

Tips

• Start with the standard defaults. Working at 1.0/1.0, Idle on Site at 1.0/0.0, and In Yard at 0.5/0.0 covers the vast majority of contractor situations. Resist the urge to customize before understanding how the defaults perform in practice.
• Override sparingly. Company-wide defaults handle most cases well. Only set location-level overrides when there is a specific contractual reason for a different rate structure at that division or project.
• Align factor definitions with your contracts. If a client contract specifies what rate applies during standby periods, make sure your Standby factor reflects that agreement exactly. Misalignment between your rate factors and contract terms creates billing disputes.
• Review factor assignments on the charge timeline regularly. The rate factor applied to each charge block determines what gets billed. Periodically verify that the factors being applied match what equipment was actually doing during each period.