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Updated: 6:30 PM Jan 5, 2011
Rising gas prices impacting area businesses
The rising gas prices are particularly impacting businesses that depend on driving, we find out who it's hitting the hardest.
Posted: 5:31 PM Jan 5, 2011Reporter: Amelia Cerling Email Address: Amelia.Cerling@weau.com |
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Gas prices are on the rise once again, with unleaded sitting at $3.19 a gallon in Eau Claire on Wednesday.
The higher prices are particularly impacting businesses that depend on driving. One of the most hard hit businesses? The U.S. Post Office.
Seeing those numbers climb can make anyone’s stomach turn. But for the post office, even a one cent climb is a big deal.
“When fuel costs raise by one cent, one cent alone, it costs the post office more than $8 million a year,” Post Master Susan McInnis says.
Which means McInnis has to keep a watchful eye constantly trained on fuel prices and the record books.
“The post office like all businesses we’re constantly looking at bottom dollars and everything that impacts that so you have to look at ways to save, and save as much as you can in another area,” she explains.
City transit systems are also keeping their eyes trained on fuel prices. But Eau Claire's transit manager says the city learned from 2008's gas price hikes when the city raised bus fares by 50 percent.
“I know we budget well for this because of past history with it, we've kept that consistent, I just feel that we're prepared for it and adequately prepared for it,” transit manager Mike Branco says.
As for businesses like Jimmy Johns, that makes it’s money by delivering to others, gas prices have an impact on the bottom line.
Well its’ something we certainly keep our eye on, we pay the driver 5 percent of whatever they make in sales, so if gas goes to $3.20 or higher we also raise our rates to 6 or 7 percent, 8 percent depending, so it does effect sales and the bottom line,” Jimmy Johns on Brackett Avenue owner Nolan Wagner says.
Economics professor Eric Jamelske at UW-Eau Claire tells us most people budget for the short term so even small gas hikes can be startling, but he adds, generally gas prices will come down again.
Jamelske adds that the BP oil spill in April may be contributing to this current gas hike.
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