Dear Dan: Two years ago when gasoline prices took off, we coped by cutting back and dealing with the pain. Now things are even worse, and we’re feeling the squeeze like never before. What’s a small business to do? – Pained at the Pump
Dear Pained: With fuel costs already through the roof,
and headed even higher, small business owners everywhere are feeling the pinch. And for travel-intensive businesses, such as those offering deliveries, it’s more like a punch in the gut. Government estimates say gas prices could hit $4 per gallon this summer.
Employees are also feeling the pinch, and the most fortunate small employers are trying to help on that front as well. Some are boosting payments for employee-incurred mileage, while others are letting workers telecommute more often.
Here are ways that small businesses of different types can cope with the rising cost of gasoline and other fuels:
• Add a separate fuel fee: Call it a fee, call it a surcharge – call it whatever you want. But more and more small businesses are tacking on a special charge to offset the cost of gas. Customers may not be happy, but most understand since they’re dealing with the same situation themselves. They don’t expect small businesses to absorb gas price increases forever.
• Restructure your pricing or territories: Some businesses are restricting the areas they serve, or charging more to go out of area. Others are raising minimum charges or putting tiered pricing in place to compensate for having to travel greater distances.
• Use an outside shipper: Small businesses that once delivered small supply orders themselves are finding it cheaper and more efficient to send things via UPS or the postal services. In many cases, items arrive in just a day or two. Shipping services Web sites such as RedRoller.com can help you find the lowest cost carrier.
• Leverage the Web: Show customers how buying online and by mail order can save them money by not having to visit your location. Use Web-based collaboration sites to “meet” with clients, freelancers, partners and others rather than meeting in person. A few choices include Zoho.com, Basecamp.com and WebEx.com.
• Hop into a hybrid: A few years ago, there were only a couple of hybrid models to choose from. Now there are dozens, including SUVs and vehicles suited for small business needs. Even if you don’t get a hybrid, lighter-weight vehicles and those with smaller engines may be far more fuel efficient than what you have. If you plan to switch, a great place to compare fuel efficiency information is at FuelEconomy.gov. •
Daniel Kehrer can be reached at editor@business.com.
