High gas prices harm small businesses that need large vehicles: NPR

High pump prices harm small businesses, such as gardeners, plumbers and carpet cleaners, who often rely on gas vehicles to serve their customers.



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While President Biden is making plans for a petrol tax, small business owners and the self-employed are suffering. Many drive trucks or vans that absorb gas and have no choice but to pay. From Chicago, reports David Shaper of NPR.

DAVID SHAPPER, BYLINE: This is one of the safest sounds of the summer …

(MOWER SOUND)

SCHAPER: … A gardener runs his lawn mower to mow the lawn in yards on the northwest side of Chicago. Antonio Uriana leads this team of three for Arturo Landscaping and I ask him how much he spends on petrol.

ANTONIO URIANA: One hundred.

SCHAPER: One hundred dollars a day?

URIANNA: Yes.

SCHAPER: For what? What are you filling, the truck?

URRIANNA: For trucks and machines.

SCHAPER: The truck and …

URIANA: The car.

SCHAPER: The machines are three large mowers, an edging and a leaf fan. Oriana shows me the receipts from the gas station she has on the seat of her diesel truck.

OCTOBER: Diesel – six.

SCHAPER: Over $ 6?

URIANNA: Yes.

SCHAPER: Landscapers often set their prices in the winter before the mowing season begins here, or even in the fall for returning customers long before gas prices jump so high. And raising prices is now difficult because they can lose customers. And they are not the only ones struggling to make ends meet.

KALINA MARK: Did you have a question, ma’am? What can I take for you?

SCHAPER: At this farmer’s market in downtown Chicago, Kaleena Mark of the Mark Family Farm Market is helping the last few customers while her husband John packs the tents, tables and products they haven’t sold to take back to the family farm in La Port , Indiana, about 65 miles.

MARK: And you can’t bring a small car, so you have to get a truck. You have to tow a trailer. On average, when we pull the trailer we brought today to launch our product, the pickup travels about 10 miles per gallon.

SCHAPER: At about 5.25 gallons, Mark says making twice-weekly 130-mile trips to Chicago’s farmers markets, in addition to all the other fuel costs on the farm, really adds up.

MARK: I would say it’s easy between fuel for tractors, fuel for a work truck and then just plain fuel that we spend on a normal basis to get from here and there, we’re probably easily $ 500 a week in fuel.

SCHAPER: So the brands say they have to sell almost all of their flowers, tomatoes, asparagus and strawberries just to cover those costs – and they didn’t do it that day.

MARK: It’s very difficult if you go out and go all this way and bring a bunch of things and then you have to pack everything and take it home. This is the hard part. We are currently more negative than positive about books. Let’s put it this way.

MICHAEL ALTER: They cling to almost every aspect you can think of.

SCHAPER: Michael Alter is a professor of entrepreneurship at the Booth School of Business at the University of Chicago. And he says small businesses that are route-based or have to drive to their customers like contractors, plumbers, electricians, cleaning services, destroyers, they all take the hit.

ALTER: And what is happening is that the price for the same service is increasing significantly because the prices of their fuels are much higher. And it just hurts profits and damages cash flow at a time when they’re probably struggling.

SCHAPER: And Alter says that many of those who are self-employed or run a small business do not have a big pillow.

ALTER: So you have people who don’t have as much reserves to manage through these higher prices and lower profits and the cash flow hit that’s going to happen to a lot of them. And that’s why I expect that there will be some businesses that unfortunately fail.

SCHAPER: Alter advises small businesses not to be afraid of raising prices or adding additional fees, because most customers now understand the need and expect it. But he added that economic uncertainty is currently making it very difficult for small businesses to plan ahead for next year, next month, and in some cases only tomorrow. David Shaper, NPR News, Chicago.

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