[Business Issues] Pain At The Pump

Motorists may cringe at site of gas station workers changing billboard prices, but they won’t get much sympathy from PCOs — small business owners whose livelihood depends on vehicle fleets.

Several times in the last four years, gasoline prices have briefly spiked over $2 a gallon in parts of the country, only to fall back. But for nearly a month (as of press time), the national average has been around $1.79 a gallon, the highest on record. While most PCOs accept gas price increases as a cost of doing business, all PCOs would agree that most recent price spikes have been a "difficult pill to swallow."

Probably the biggest question a PCO asks himself in the wake of a gas price increase is, "Do I add a fuel surcharge to my bill?" It’s something Gregory Pest Prevention, Greenville, S.C, — a company with 100 service vehicles – has considered, "but instead, we have opted to be more aggressive with our annual price increases, explaining to the customer the increase cost of doing business and that fuel charges are the lead cause of our increased expenses," says Ben Walker, the company’s vice president of operations.

But large companies are not the only ones feeling the squeeze of gas price spikes. Nelson Cruz, owner of Cruz Pest Control, Douglasville, Ga. — a one-man operation — has been looking for ways to offset fuel costs. "I have rerouted my customers and sold them other services (e.g., treating lawns, ornamental shrubs, etc.)," he says. "I am pessimistic about the cost of gas but optimistic about the increase of business."

Many PCOs have responded by reexamining their vehicle use patterns and have found ways to streamline their company’s gas usage habits. John Gedeon, Jr., owner of The General Pest Control, Cleveland, Ohio, says it is more important than ever to "re-evaluate routes and determine if we are as efficient as possible."

Many times being proactive with your accounts can help achieve efficiencies, Gedeon said. "For example, if you are servicing a 24-hour convenient store in the morning and then making a separate trip later in the day to service the next door pizza shop, see if you can get keys to the pizza shop so that you can service both accounts during the same trip."

Another gas savings tip from Gedeon is taking advantage of fleet management programs offered by oil companies. Gedeon’s company utilizes BP’s Fleet Management Program. As part of this program, Gedeon’s service technicians receive a fleet card they use to purchase gas from any BP station throughout the Cleveland area. The program costs Gedeon $10 per month, but in return he receives a discount on gas purchases, as well as monthly vehicle and driver reports. Gedeon estimates that this program saves him $300 to $400 per year on fuel expenses.

In addition to rerouting, Walker says Gregory has begun a rewards program. At each branch office, the technician with the lowest price per gallon in any given month is rewarded with a gift certificate to his or her favorite restaurant. "Everyone’s price per gallon is posted in the local office so everyone can see how they compare to everyone else. It isn’t much, but it keeps everyone aware of their fuel expense," he says.

The author is Internet editor of PCT Online and can be reached at bharbison@pctonline.com.

Source: AAA