Business

Rising gas prices pinching businesses, consumers

Monday, February 18, 2013
Businesses feeling pain of rising gas prices Close up of high gas prices sign - $4.49 gas pump

Gas prices are skyrocketing in the Bay Area, up more than 45 cents in just one month. According to AAA, gas prices have risen for 32 days in a row because of higher oil prices, production cuts and refinery issues.

Drivers are paying an average of $4.13 in San Francisco. That's up 46 cents from a month ago. In San Jose, the average price is $4.08 a gallon, a 49 cent increase. And in the East Bay, prices area just above the $4 mark. Just a month ago the average price in Oakland was $3.58.

Small and large businesses are feeling the impact of higher gas prices. Some businesses are able to pass on the increase to their customers but others cannot, and they're hurting.

Rebekah Northway owns a floral design business called The Petaler. Driving around San Francisco is affecting her bottom line and there's nothing she can do about.

"My clients would not be so happy if the rate was changing every week based on the gas prices," she said.

"It totally affects me," handyman Don Burke said. "The bottom line is when you're a handyman and you're using your own truck and your own gas, it hurts."

Burke says his truck only gets nine or 10 miles to the gallon. The 13 percent increase in gas prices this past month means he won't have much left for himself at the end of the day.

Mike Lake drives a town car for a living. He says the sudden unexpected rise in prices makes it hard to put money aside for himself.

"Impacts that a lot because it's so competitive, and you just can't raise your prices when you feel like it," Lake said. But this jump has been so big, he did raise his prices for new clients last week by 20 percent.

Burke says he'd like to pass the cost off to his customers, but says he can't, "It's hard to do, everybody seems to be in a pinch," he said.

Some cab drivers have been complaining for weeks about the higher gas prices. "We are paying extra $5, $10, up to $15 extra than before," said cab driver Jim Vos. "That means less for us, or course."

The big chain companies like Safeway, which has a fleet of small home delivery trucks, have also seen their gas bills go up. Shipping companies like FedEx need to stay competitive and don't want to raise prices.

The increase in gas prices has some thinking about how to use less gas. "Not going to drive as much," San Francisco resident Kirsten Rojas said. "Probably be more conservative, use the bicycles more."

The only ones who don't seemed too bothered about what's happening at the pump are the owners of hybrids or small cars. Joe Free says his girlfriend fills the tank of her Smart car once every two weeks.

According to AAA, the least expensive average price in the Bay Area was found in Fremont and the most expensive was in San Francisco. Predictions are that the increase in gas prices will continue through the spring, so plan accordingly.

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Tags:
gas prices, oil, economy, AAA, business
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