Remember earlier this year when oil topped $100 per barrel for the first time ever? It seems like a long time ago now that it's breaking new records and approaching $120 per barrel. For business owners and employees who spend a lot of time on the road, the thought of the usual summer gas price hike, which could reach above $4 per gallon according to the U.S. Department of Energy, may have them spewing, well, crude language.
This has become such a hot issue that earlier this month the House Committee on Small Business gathered for a hearing to address the impact of rising gas prices on small businesses. So what can road warriors and business owners do to prepare for high summer gas prices?
"It's important for your employees to know, when driving, to maximize their mileage and take the most direct route to their stops," says Marie Montgomery, spokesperson for the Automobile Club of Southern California. Montgomery also suggests, "In general, slow down. The more that you speed, the more fuel that you're going to burn."
The Federal Trade Commission offers several fuel-efficiency tips and reiterates Montgomery's advice, noting that gas mileage decreases rapidly at speeds above 60 mph. In addition, the FTC highlights something a business owner may overlook, which is extra weight in the trunk. Ditching 100 pounds of promos, fliers and snow chains could boost fuel economy by 2%. Furthermore, drivers can shave another 5% by not putting carrier crates on the roof and replacing a clogged air filter could offer a whopping 10% improvement. Lastly, the FTC says to keep your tires properly inflated.
"Probably one in three vehicles has
at least one under-inflated tire," says Montgomery. "That wastes gasoline; about 2% per pound of pressure under
Montgomery says tire pressure should be checked when the tires are cold to get a more accurate reading. To make sure you're getting the most efficiency out of your fleet, Montgomery suggests business owners find ways to encourage their employees to practice better driving habits and maintenance of company vehicles.
Fuel prices are hurting more than just automotive travelers. Those who need to get on a plane may suffer from greater sticker shock than when they're pumping 89-octane into their gas-guzzling SUV.
"The macro economics and industry fundamentals are such that with the spike in fuel costs, these airlines have no choice but to park airplanes and significantly increase fares," says Vaughn Cordle, chief analyst for AirlineForecasts and pilot for an unspecified major airline. "If they don't, they're going to end up in bankruptcy."
"The fuel bill for the passenger-carrying airlines was $30 billion in 2007 and this year it could be as high as $49 billion, if oil prices stay anywhere near where they are today."
For business owners bracing for air travel turbulence, Cordle suggests booking early and locking in a seat as soon as possible, saying he doesn't believe the ticket prices have yet caught up to the increased fuel costs.
"In terms of breaking even on higher fuel costs,
airlines are going to have to raise fares across the board 15% to 20%," predicts Cordle.
As if inflated ticket prices weren't enough, Cordle says air travelers should keep an eye out for airlines attempting to generate revenue through other means like increased fees for extra baggage or weight.
Cordle says the airline industry is still struggling and could see more bankruptcies and consolidation. This means more hassles for business travelers facing delays or even canceled flights.
Montgomery suggests signing up for alerts offered by airlines that deliver flight status information via email, voicemail or text message. "But don't trust it," warns Montgomery. "You want to call before you leave for the airport to make sure that your flight is actually going."
Another idea from Montgomery in preparation of delays is to program various numbers into your cell phone before you get to the airport. She recommends the number of your airline, hotel, car rental company and travel agent so you're able to change your itinerary on the fly.
There are, of course, less complicated solutions than planning to change your plan. Here are a few other tips businesses can employ to help alleviate high summer gas prices:
- Web conference
- Ride a bike
- Reschedule air travel for off times
- Offer work-from-home days
- Increase work hours Monday through Thursday and offer Fridays off
One of the toughest elements of running a business is overcoming the uncontrollable. Smart business owners, however, can overcome high summer gas prices and coast on cruise control by preparing now.
Steve Cooper spent over six years at Entrepreneur magazine and Entrepreneur.com. He was most recently the managing editor of Entrepreneur.com and was previously the research editor for Entrepreneur magazine. He has a degree in journalism from San Francisco State University and runs his own business, Hitched Media, Inc.