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Gas prices


eboniesmith

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A means of luck or careful planning?  Maybe it's me, but I was under the impression, and it makes more sense to me, to be cognizant and proactive in area of your business.  Now, I have to be honest and say that the only way that I know what the average gas prices are in my community, is to ride past a gas station.  When I launch my vending business, however, I know I must stay abreast to the industry and find what affects gas prices as it has a huge impact on our businesses (servicing machines, etc)  If I know that gas prices will rise x percent in the next month, I can schedule servicing, etc accordingly so that it won't eat into my profits.

But, hey!  Maybe it's me.  As one of my SBA business counselors told me "You're looking into it too much!" LOL  Really, though, what can we do to stay abreast to gas price changes?  Share your resources!

 

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I usually have no problem predicting gas prices. At least in the short term. I watch the price of crude. Gas prices in my area trend 5-7 days behind the price of crude.

Not much of a lead time but it helps me decide when to fill up. It also helps me know when it's time to fill up on home heating oil.

Steve

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They say it takes 4-6 weeks for the current days price to hit the pumps on average. This does not include manmade panics like hurricanes. I guess if this holds true then you could keep an eye on the futures market to judge it.

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It's simple.

When the prices are going down, wait until you are on empty to fill up. When they are going up, fill up every day. 

and/or...

When you are out on your route and you see a cheaper price than the ones you see at home, then fill'r up!

You should also remember to do what ever errands you need to do while you are doing your route.  That will also save some gas money.

Don't let gas prices be another reason not to get started in the business.  Unless you live in Houston.  Then the gas prices are a killer and should be weighted considereably. :cool:

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Ebonie,

I think a better question first might be what can I do to maximize my route management overall. Gas prices are only one component of overall management.

For our routes, since we are so spread out, we had to take a hard look at the areas we serviced and see if we could effectively manage the same areas by increasing the amount of time between servicing. We offset gas prices by decreasing servicing expenses since we are on the road less. This made a drastic difference for us over the course of a year.

We also cut portions back some and changed to some higher profit margin candies.

I'm sure you've already thought about most of these ideas, but for me, I want to make the most of my time every time I leave the door. That way I preserve my margins by keeping my expenses low (gas especially).

Anyway, it's sure a blessing now that gas has gone back down. I paid $17 to fill up my Santa Fe the other day. I wanted to frame the receipt it made me so happy!

Hope this helps.

Mark

For me, I try to do as much as possible when I make a trip to service so as not to have to backtrack and revisi

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Hi Mark,

Your website was one of the first that I found about vending when I started looking into it. Thanks for all the helpful information. It made a difference when I got started. In your opinion, how many machines can one person handle if he's only doing bulk vending part time?

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It depends on how fast you are servicing, how much to talk to people within the location.

For me, I have got to the point where I can go in, fill a machine, take out quarters, and clean the machine in under 1 minute per machine.

Kyle

Wow! You can do all that in under 1 minute?! That's pretty amazing, Kyle.
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They way I see it, the cost is almost negligible. One half of my two routes is about 93 miles round trip. If gas is $2.00 per gallon and my car gets 20 miles per gallon, that's about $9.30 to run the route and collect my $120+ in quarters. If I was off that day, I'd probably do about 50 miles in driving any way just driving around, so the net effect of going out to service the route is only $4.30 if you think about it.   Of course, it's different if you do absolutely NOTHING at all during the day, every day then it'll be more costly. 

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It depends on how fast you are servicing, how much to talk to people within the location.

For me, I have got to the point where I can go in, fill a machine, take out quarters, and clean the machine in under 1 minute per machine.

Kyle

Wow! You can do all that in under 1 minute?! That's pretty amazing, Kyle.
must be a mexican minute.(not a racist joke for those of u that never heard this saying)
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I understand trying to maximize your gas dollar. I dont have any sites for predicting gas however AAA does have a site that is updated DAILY to let you know the average gas prices in a given city. That site is http://www.fuelgaugereport.com/. Also there are some things you can do to make every bit of that gas go as far as it can for you. The 3 biggest (and cheapest) things you can do are:

1. Keep you tires properly inflated, you lose 1% on ur fuel economy for every lb under, I have ppl come into the shop that are 8-9lbs under on average its EASY to do and most shops do air checks for FREE.

2. Make sure your air filter is clean. Dirty air filters can cost you as much as 10%, you dont have to go buy a $40 K&N or anything, a cheap wix or stp filter will be just fine and they only cost about $10 for most cars.

3. Every 3months or so pour in a GOOD fuel injector cleaner. I dont know percentages on dirty injectors to be honest but I do know dirty injectors will cause a drop in fuel economy due to the alteration of the spray pattern of the injectors, not to mention having to get on the gas more just to do what clean injectors should already do. One of the best cleaners out there is the one from lucas and its only 4 bucks.

I know I got a lil off topic but I hope the website and the recs help. Good Luck.

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People talk about the high price of gas, but has anybody noticed lately that gas prices have taken a nose dive over the past few months?  The price of gas is actually less now than it was 5 years ago.  I can fill up my tank for less than $20 whereas it used to take $50 to do that last summer.

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It depends on how fast you are servicing, how much to talk to people within the location.

For me, I have got to the point where I can go in, fill a machine, take out quarters, and clean the machine in under 1 minute per machine.

Kyle

So it takes about 5 minutes to do a 5-head rack?  Or does racks take longer to service than singles?  I know with racks you have to carry in more product selections than you do with a single gumball location.  So it might take longer than it would for a single gumball location to unload 5 different products from your vehicle, pop open each machine, add/swap product, take out the money and then button them all up?
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Oh I know its not high right now compared to 3months ago. I have to use premium and it used to cost me $54 to fill up once a week vs $21 yesterday. Just giving some friendly advice in preparation for the rise that is bound to occur. Im actually scared of what the prices are going to go up to this next time.

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Oh I know its not high right now compared to 3months ago. I have to use premium and it used to cost me $54 to fill up once a week vs $21 yesterday. Just giving some friendly advice in preparation for the rise that is bound to occur. Im actually scared of what the prices are going to go up to this next time.

I read some headline news that some localities are thinking of raising the tax on gas because people are driving less and therefor not generating enough revenue to keep up with repairs for the roads.

I guess that when the recession gets better, and people start driving more, then prices will start going up again.  My teenage daughter is just now starting to drive and knows that she has to pay for her own gas.  She's lucky now, but in a year or two when the prices are sky high again, it's going to be an issue for her.  My wife and I keep telling her to enjoy it now, cuz it won't last long.

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The low price of gas now seems like a good thing but it is not. It is a reflection of how bad the economy is. They want to add another 40 cents of tax over the next 5 years. "In a report expected in late January, members of the infrastructure financing commission say they will urge Congress to raise the gas tax by 10 cents a gallon and the diesel tax by about 12 cents to 15 cents a gallon. At the same time, the commission will recommend tying the fuel tax rates to inflation."

You can read the whole article here: http://news.yahoo.com/s/ap/20090102/ap_on_go_ot/gas_tax Right now Mexico and Iran will be in bad shape by the end of 2009 if the price remains in the area it is right now. Mexico gets half of it's income from oil exports, I heard recently, and Iran get a large part also. You might say who cares about them but if things get desperate what do people do, desperate things is what they do. We are at peak oil now or so they say.

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Ebonie,

Sorry for taking so long to respond. I was still part time up to about the time I had 1500 machines, yet I had a couple of contractors helping me cover about 400 of the machines.

Staying part-time would depend on a number of variables (many already mentioned), but a lot would deal with the way you logically laid out your route so as not to be too spread out. If you are fast (not even as fast as Kyle) you should be able to cover at least 50 heads in a day and probably up to 80. Vendstars and racks would take longer.

The greatest time savings for me was to extend the time I serviced my routes. I pushed the times as far out as possible and yet still maintain good customer service (the main thing being not letting machines go empty). For the 2-5% of machines which would go empty I would add an additional machine at the location or increase the size of the globe. Beavers RB series can use either a 16" or 18" globe. Adding an 18" globe gave me an additional 2-3 weeks roughly to accomodate my new schedule. You might check your machines to see if this is a possibility.

One major thing successful entrepreneurs typically do as they launch new businesses is to do the launch while working their existing jobs. You might consider waiting as long as you can to go full time if you already have a good job. I waited about 4 years and would have waited longer if my circumstances would have allowed it.

You might also consider hiring (trusted) contractors if you can manage the additional potential risk and continue in your other endeavors.

For entrepreneurs, many don't want to just "buy another job" but work their way out of the rat race to free them up to develop other income streams or other interests including family.

For me, I had to be more heavy on the self-employment aspect of it at the beginning and now I am gradually adding more people to my team and beginning to transition to more management and locating. I like to trade stocks, mess with rental property and also do occaisonal overseas trips. This is the direction I'm headed to more and more as continue to grow and transition in different areas.

You have to consider all these things I believe to really answer your question well (besides just how many machines you can effectively service yourself). Do you want to be out there servicing 1000 or 2000 machines 10 or 15 years from now? If not, why not lay the groundwork now while you are building your business? Get the vision for YOUR business the way YOU want it to look down the road. Then, begin developing the key components of that plan.

The thing I learned is that I DONT have to do everything myself. The contractors I have only cost me only about 5%-10% more than the costs for me to service myself (these are specific to my margins and yours might be different since I am spread out quite a bit).

I have other people who help count money, record data onto our spreadsheets, and locate machines. I have an attorney and accountant on retained, a good role model to bounce business and expansion ideas off of, kids who help do my prep work before I go out, and others who generally encourage me.

Sorry for being so long here but I really want to encourage you to spend quality time things about using "OPT" - other people's time to answer your own question. It has really helped me expand well beyond what we should have been able to.

Also I highly encourage you to read "Rich Dad Poor Dad" and the sequel "Retire Young, Retire Rich."

Have a great day.

Mark

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