Fuel costs are dropping, but concern remains high

August 16, 2000
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The price of gasoline is dropping, at least in the Midwest, where prices soared to $2.19 and above during late spring and early summer. Despite the easing of prices, The News wanted to know if the increases would have any long- or short-term affects on how contractors adjusted to higher operational costs.

We asked our Contractor Consultants what they were doing, if anything, to offset higher fuel costs. Here were the questions:

  • Has the latest hike in gas prices had an effect on how you do business? If so, how has it affected your business specifically?

  • What was the peak price of gas in your community, and do you know if other contractors felt the pinch in your area?

    Jo Navaretta (Lake Havasu, AZ) said: “We have definitely noticed an increase in our gas costs and have instituted a $2 fuel charge on all service tickets.

    “We had considered keeping all work trucks at our site rather than having employees drive them home. However, due to the lack of parking space, we have not found an alternative to allowing our employees to take their vehicles home.

    “One of our local plumbing contractors started keeping his trucks on site and indicated fuel cost savings of approximately $800 per month.

    “The peak price of gas in our area was around $1.98 per gallon.”

    Scott Getzschmann (Fremont, NE) said: “The gas crunch did affect us slightly, but because it came during a very hot and busy period, it wasn’t as noticeable on our budget. Our gas budget increased by 25% one month and 30% last month. We have added a $25 trip charge to all calls out of our normal 35-mile radius.

    “My roofing division travels many miles to do manufacturer service and we were allowed to add a fuel cost because they were allowed to charge it back to their customer.

    “We have 28 trucks and only service techs and managers take vehicles home because they can be called out for emergencies. About half of our fleet remains in our center overnight and on weekends.

    “Another savings measure is a vehicle gas, insurance, and maintenance allowance that we pay to key management employees. I sent a memo to all employees in regards to conserving gas. I would say that most realize it is a burden for the company and they did all they could to help conserve.”

    “Regular unleaded peaked at $1.99 per gallon.”

    Aaron York (Indianapolis, IN) said: “[Gas prices] have not really had an effect on how we do business. We increased our truck charge from $20 to $25 and had no complaints.

    “We’ve always paid attention to effective routing and keeping techs out of the supply house, etc., so we saw no changes there. Other contractors and suppliers have felt the crunch and are trying various approaches to offset the cost but none have been very creative.

    “The peak price for gas was $1.87 per gallon.”

    Hank Bloom (Mentor, OH) said: “We started to keep track of all mileage and will charge our customers accordingly. Other contractors are doing similar things, like adding fuel charges to bills.

    “The highest prices we’ve seen have been around $2 per gallon.”

    Publication date: 08/21/2000

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