Mining services
Rates set in one market, worked in another.
Rates are set years before the labour, parts and fuel that must deliver them. The fleet consumes capital whether or not it earns.
Where margin and cash come under pressure
- Schedule-of-rates contracts priced in a different labour market, with escalation mechanisms never invoked or never adequate.
- Fleet economics that reach the forecast only when the rebuild bill arrives.
- Scope drift absorbed as goodwill: extra services inside the day rate until the margin has left.
Decisions that shape value
- Which contracts to hold. Renewal, repricing and exit are portfolio decisions, not account decisions.
- Where to deploy the fleet. The question is what the capital returns, not whether the machines are busy.
- How to approach renewal. Most margin is won or lost at renewal and re-tender, and the evidence takes years to build.