Do we really care about the cost of gas?

[plainpainter 217]

I was talking to another contractor and then reading a thread about vehicle choice here - and the same thing pops up, people are sensitive to mileage. Then it got me thinking - should we really care about mileage or the costs of gas? If we are professionals - shouldn't we just factor in the extra cost of gas and pass it on to the homeowner? More than ever, guys running around with $99 house washes are the ones that will truly suffer. If I charge $350 for a minimum house wash last year - what do I really need to mark that up to take into account extra gas costs? $360 or $370? Is the cost of gas the only thing between success and abject failure? I ran a pressure washer for like 3 or so hours on one gallon of gas - so instead of a buck it's 4 bucks - on a $2,400 deck resto - who cares?

[newlook 265]

We are seriously looking at the gas prices these days. Filled up my utility truck at Costco today at $3.799 per galloon. Took 20+ galloons. My other truck - GMC Sierra tops out at around $80.00.

Diesel is hovering at around $4.61.

Cost of materials across the board have gone up also.....yep I care!

[Beth n Rod 1,279]

We care too!

Beth

[MMI Enterprises 289]

Dan, I don't care if the arrival and task of that job was all that I had to consider. Unfortunetly though I got things like driving there first to market to them then I gots to drive there to bid them then I gots to drive to get supplies for them then I gots to drive however many times to service them then I gots to drive to the bank to cash funds then I gots to drive my butt to the refreshment/recovery place after getting worn out from pumping all that gas and then I gots to do it all over again... yea I care about it. :) Not only must we raise prices to account for the actual loss but we got to raise even higher to protect our margin of effective profits against the Jones so we can keep up family recreational activities outside of work..

[plainpainter 217]

My point is - if we are professionals, can't we just pass on the cost to the customer? I know in the painting trades. Painters use to be really sensitive to price increases. Now if you talk to my independent paint dealer - he'll tell you that if 2 guys in a hundred squawks about price increases - he would be surprised, everyone is just passing on the cost to the customer. We're all in the same boat - it's not like I am paying only a $1.20 a gallon, and undercut everyone else.

[newlook 265]

Dan - good points. I think people in general are aware and in tune with the gas prices. If explained to them in the proper context I would think that a potential customer would understand the "why" component on the price for a contract.

[plainpainter 217]

Ok - put into perspective. My astrovan can go 750 miles or 2 fillups a week - and spending about $150/week on gas. Say gas was half the price - I'd be spending $75/week. Is that extra $75 really hard to pass onto the customer? An extra $25 on a last years $350 housewash - and you paid the difference in 3 housewashes - and probably nobody will have balked at your pricing - am I really off on this?

It just seems to me so many people balking at price increases like the cost of milk - at the same time have an $800 per month loan on their lexus.

[Doug Dahlke 114]

It's not just the cost of fuel to run your business that you need to worry about. When fuel costs go up, everything goes up. Delivery charges you have for supplies delivered to your house go up, the price you pay for your groceries goes up, the printer that makes your marketing materials raises his prices to you, the list is endless. Pass all those increases along to your customers to maintain your standard of living and it is more than just a few dollars.

[plainpainter 217]

Like I said - we're all in the same boat - business is business, and passing on those costs is exactly what we are suppose to do as businessmen.

Here is another question that may make more sense - has anyone computed the costs to doing a housewash compared to this time last year and the year before? How much are we really talking?

[Jon 533]

Carlos I told you before move to NM, diesel here tops off right now at around $4.35 down to $3.89. I buy from TCH, they own the Flying J truck stops. Still cost vary depending on the location between here on Covina, CA.

We all know the full cost to wash a vehicle, house, clean concrete etc. is much more then our labor, fuel and chemicals, insurance and all other things required to make a fair profit and when competition keeps their cost low in this day of raising rates it is going to be harder to compete.

Not being in the business anymore I wonder if these higher fuel rates will slow down those week-end warriors, low ballers and newbies to the industry?

I would hope so then all of you that have been around a few years will increase your business gaining those accounts.

Has anyone done a post with just the cost of fuel state by state here? no posting other then cost of regular and diesel.

[newlook 265]

Hey Jon - how in the heck are you?

I wonder which state cost the most for fuel? Betcha Calif. is in the top 5 hands down.

I know the Flying J you are talking about Jon....have a few in the Bay Area and all down I-5 to Barstow/Vegas.

[plainpainter 217]

Jon brings up a good point, how about the 'silver' lining with the cost of gas. If these lowballers are already working with razor thin margins - couldn't the cost of gas be the one thing that stops them in their tracks? Or lets look at it another way - we ain't burning fuel like an airline company - fuel just isn't such a core thing like for a jet which needs millions of gallons for thrust.

[Jon 533]

Carlos I am fine, enjoying life here and burning my guts out with the SPICY food which I DON'T care for since it is truly Mexican spicy!

I would say Hawaii cost a lot more since the only way to get it there is by floating tankers.

Remember you’re in the affluent part of CA where everything cost more but also where the greatest wines are grown.

Going to become a bionic man in one week with total knee replacement, that way I can keep up with you younger guys again!

By the way are you trying to look like Sly Stallone in your picture here?

[Dave O 15]

Jon brings up a good point, how about the 'silver' lining with the cost of gas. If these lowballers are already working with razor thin margins - couldn't the cost of gas be the one thing that stops them in their tracks? Or lets look at it another way - we ain't burning fuel like an airline company - fuel just isn't such a core thing like for a jet which needs millions of gallons for thrust.

Lowballers as everyone calls them will always survive.

They usually dont pay insurance, taxes, license fees (Most are not even registered with their state or county), and many more reasons.

[newlook 265]

LOL - the pic was taken on a cruise ship out of Long Beach a few years back.

Best to you on the knee replacement - ouch! Pretty much everything around here is costly...even the air. I don't trust air that I can't see though ...LOL.

Let me know if you want some good Napa Red Jon. I actually took about 4-5 bottles of Charles Krug (Mondavi Family) down to the ACR RT last year in PA. Needless to say after about the 3rd bottle we had Tom V. break dancing at the hotel club.

Stay in touch my friend....back to the topic.......

[fireandrain 39]

My point is - if we are professionals, can't we just pass on the cost to the customer? I know in the painting trades.

Thats what I do, its fair and it works for me. I think we should be more concerned about the imminant dissapearance of this natural resource. My .02

[fireandrain 39]

and the imminent disappearance of my ability to spell correctly!

[newlook 265]

Matt - give me a call sometime. There is a function in Sacramento in May that may interest you...707.812.3702

[MMI Enterprises 289]

umm what that be Carlos? Haven't planned for anything but hayfever and heat myself..

[MMI Enterprises 289]

I think we should be more concerned about the imminant dissapearance of this natural resource.

dontcha know the oil is just like lowballers? They abiotic and the Earth just keeps making more. You can dig 4-5 mi. down on bottom of ocean and there they be, a whole colony of lowballers welling up one after the other.

Hmm..surely old dinosaur wash guys don't turn into lowballers after millions of years..do they? :lgbonk:

[Beth n Rod 1,279]

Given the fact that we provide free estimates, yes, we do care about the price of gas because not all of those estimates will result in a sale. Now, don't give me any guff about closing rates and salesmanship because they don't apply if the prospect is not home to talk to you and never picks up the phone to ask questions. They look at the bottom line and decide from that alone the majority of the time.

Those trips become wasted money and while we do our best to schedule time to be with the client, their obligations don't always provide that flexibility.

The price of gas is but one of the many economic indicators that tell us whether people have much disposable income as they did in the past.

Gas prices not only affect our businesses but the clients as they need to budget for their needs in getting to and from work, day care, school etc...

A $1.00 raise in prices reflects into the number of gallons they use and goes up accordingly.

$2.65/gal last winter compared to $3.60 now

16 gallon tank @ 2.65 = 42.40 X 15 fill-ups in 6 months = 636.00

16 gallon tank @ 3.60 = 57.60 X 15 fill-ups in 6 months = 864.00

That's 228.00 less spending money than they had before if the prices had remained in the same range as winter prices.

Now, this is based upon a small car, most own suv's and trucks which have bigger tanks and lower mpg requiring more frequent fueling. Add to the fact that many may have 2 cars and you can see where their money is going and how it can affect your business because they can't afford as much now.

The price of gas reflects also into the end price of what we pay for retail products due to the transportation costs involved which are largely fuel, warehousing and labor. When those prices go up, the amount of disposable income drops. As we all know, our wages don't rise with the price of gas and remains pretty much constant unless you are a contractor subject to the economic impacts that result from less expendable income.

This doesn't even account for the manufacturing costs that are also impacted by transportation costs from having the raw materials transported in.

btw, gas is projected to go up by another $1.50 - $2.00 a gallon. Get your calculators out people and start figuring out how to stream line your business and keep your costs low while providing the best service possible and still be profitable.

I will leave it at this point for the readers to decide the validity of my post and to think seriously about the implications because if you are not aware of the potentials of a poorer economy just because of a $1.00 rise in gas prices, you will be a victim of it.

Rod!~

[James 625]

Prices going up sets a tone for Middle America which is now lower middle America to stop spending. The Rich are still spending off to complete a marble restoration........

[Kory 14]

It affects everything you could charge more for the gas you use on that job but you won't make up for the extra cost you pay at the grocery store.

[plainpainter 217]

I did some interior painting last December for a woman, and she had this rug on her floor that she spent 800k for - I don't think she cares about gas.

[PressurePros 249]

Rod you bring up a good point about estimates being where the money spent on fuel is not as easy to recover, but, coming from Dan's perspective.. it is. You have to raise prices across the board. Giving estimates is a part of doing business so you either charge for them (which I may start doing to slow things down some) or you factor them into your operational expenses.

Do I care about the cost of gas? No. There is nothing I can do about it. I try to make smart decisions to not negatively affect the ecology of the planet.

[Beth n Rod 1,279]

Rod you bring up a good point about estimates being where the money spent on fuel is not as easy to recover, but, coming from Dan's perspective.. it is. You have to raise prices across the board. Giving estimates is a part of doing business so you either charge for them (which I may start doing to slow things down some) or you factor them into your operational expenses.

Do I care about the cost of gas? No. There is nothing I can do about it. I try to make smart decisions to not negatively affect the ecology of the planet.

Ask your customers what they think about the cost of gas. Raising your prices is elementary. Duh... But how are consumers reacting? Well, I think it depends on the consumer. There are some who will take a chance on a lowballer, who would not have before, or they will just skip service this year. Worse, they will do it themselves.... This is not the year to ignore economic indicators.

Beth