Passing the cost of rising fuel prices along to customers often isn’t an option for small businesses. But owners can take other measures to reduce the effect on their bottom line. Among them:
Learn to better manage finances and monitor costs
“Ninety per cent of small businesses have little or no financial management,” says Warren Coughlin, a business coach with Action Coach in Toronto. A detailed review can help identify places to reduce costs – from carefully planning service and delivery routes to finding less expensive suppliers and better phone and Internet plans, he says.
Market your value
Even if you can’t cut costs, you can find customers willing to pay a premium for excellent services or products. “People will still pay for service so if you’re just flat out, better there are people who are willing to pay for that,” Mr. Coughlin says. Some extra services cost very little to provide. One roofing company sends an e-mail to its clients the day before a job, with pictures and bios of the roofing crew to make customer feel more at ease, he says.
Plan ahead to account for possible increases in fuel prices
Ted Mallett, chief economist with the Canadian Federation of Independent Business, says mapping out various scenarios when projecting cash flow can help you set prices that still cover your costs if there is a spike at the pumps.
Special to The Globe and Mail