Fuel To the Fire: Rising Costs Could Leave Smbs in the Dark

BY: ON TUESDAY, MARCH 27, 2012

It feels as if we hear about a gas crisis every summer and the today's rising fuel costs may just seem like business as usual. Perhaps so. But one can't deny that the rapid rise in fuel is a major inconvenience for SMBs in an economy which, while  perhaps not as underwater as it used to be, remains quite unstable. “Certainty” is a word that has fallen out of the modern small business owner's vocabulary in the midst of the recession, and gas prices certainly aren't helping.

Small businesses are taking a hit. A recent survey by the Small Business & Entrepreneurship Council found that 72% of the nation's businesses are indeed being impacted by today's rising fuel costs. “The fragile economy is being undermined by high gas prices,” said Karen Kerrigan, SBE Council President. “The weak recovery and policy uncertainties are already weighing on the confidence and minds of small business owners.” Uncertainty. That's the best way to describe today's business climate, isn't it?

How are SMBs bracing themselves in the midst of a potential gas crisis? According to an SBE survey, most businesses will have to halt hiring due to gas prices, meanwhile also raising the prices of their products and services in response to the bump in fuel costs. One in five businesses surveyed stated their intent to cut back on employee hours as a means to keep costs down. Perhaps the most damning statistic remains that 43% of surveyed business stated that their business simply will not survive the future if fuel prices continue to rise or remain the same.

And as small business owners are feeling the heat, so are consumers. Summer travel for both vacationers and businesses appear to be in peril, meaning especially dark days for the tourist, travel and leisure industries. According to the US Travel Association, 44% of Americans are taking fewer vacations this summer, while 37% will be traveling shorter distances. Gas prices have increased 19% in 2012 and are only 5% lower than the record high national average of $4.11 in the summer of 2008.

None of these figures or tales spell particularly good news for today's SMBs or their employees. Ineviatbly, we're ready to point our fingers at the cause, whatever it may be. Monetary policy. Foreign policy. Washington. The Middle East.

But the fact remains; fingerpointing won't help us get out of the red. With that in mind, what's next?

A positive outlook can't hurt, and believe it or not, small business confidence has actually been on the rise for the month of March. In fact, roughly 75% of CEOs in a recent Vistage survey stated that they expect sales to see an upturn over the next year, meanwhile 60% are hoping for an increase in profitability.

Signs of economic recovery are always positives, yet rising gas prices represent the monkey on the back of most Americans, consumers and business owners alike. With that in mind, what steps can you take to save in your everyday life?

Some everyday tips to consider in the midst of a fuel crisis:

  • Avoid aggressive driving, sudden stops and hard breaking while driving to converse fuel
  • Make sure that your vehicles are taken care of, from the engine to the oil to the tires
  • Take shorter trips and routes whenever possible 

There's a lot going on in the small business world today. The current fuel situation isn't pretty, but we unfortunately have to grin and bear it. Fortunately, there are steps you can take to help quell the crisis in your personal life. As signs of economic recovery have been coming slowly but surely, we can only hope that more good news will be on the way.

About the Author

Brent Barnhart
Brent Barnhart is a regular contributor to ChamberofCommerce.com. He covers a wide variety of topics through the written word, including content marketing, Internet marketing and small business trends. ChamberofCommerce.com is dedicated to helping small businesses grow their presence on the web and facilitates connectivity between local businesses and more than 7,000 Chambers of Commerce worldwide.
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