The impact of gas prices now and going forward

[ThankYouComeAgain]

I'm going to pose two questions, so let's get this going now as I think this will be a major issue for the remainder of 2011 and next year as the dollar's value continues to drop.

First, can anyone tell me if the gas prices have cause you to raise your prices? If so, can you tell me what state you are in?

Second, what will you do if you find that you're paying a lot more for gas, say, 6 dollars a gallon? Right now, I've seen prices hit $3.91. Just a few months ago it was 2.69. Do the math. Right now my prices haven't gone up, my I have a strong offer on the table to sell and I am tempted.

I'd be interested in hearing all of your anwers for both questions.

[antoniocinisi]

1)I have raised prices to .75 2 inch/50 1 inch on most of my machines.I have a couple of 50 cent 2 inch on slow moving items or mystery mix I want to move but once those toys are gone the few .50 mechs I have left are going to .75 also.I have a few more .25 1 inch heads but those will get converted soon.raising prices is a little harder to do with existing locations,all my new locations have been at the .75/.50 for a while now. with gas going up now is the time to raise prices as locations will be more understanding.

2)make adjustments such as driving the speed limit extending service cycles and possibly watering down toys as a last resort.

[mission vending]

I'm going to pose two questions, so let's get this going now as I think this will be a major issue for the remainder of 2011 and next year as the dollar's value continues to drop.

First, can anyone tell me if the gas prices have cause you to raise your prices? If so, can you tell me what state you are in?

Second, what will you do if you find that you're paying a lot more for gas, say, 6 dollars a gallon? Right now, I've seen prices hit $3.91. Just a few months ago it was 2.69. Do the math. Right now my prices haven't gone up, my I have a strong offer on the table to sell and I am tempted.

I'd be interested in hearing all of your answers for both questions.

Gas prices have not caused me to raise prices. My fuel bill for April is a little north of $1,500.00. I have raised some prices so far this year as I have gotten price increases on product. I've said it before and will say it again here, I will keep my COGS at the industry avg of 50-55% and unless something causes me to change this philosophy I will continue to raise prices as needed to keep within this range. Remember this is an issue that EVERY vendor and EVERY other type of business that provides services must deal with. Make sure you have done everything that you can reasonably do to maximize fuel economy.

If gas goes to 6 bucks a gallon or more (I'm currently paying almost $4) that is a 50% increase, so my fuel bill based on April would increase to around $2300.00. By then most of my products will also have increased in price and my prices will also have increased. So will it eat into my margins? Yes, but not more than a couple of % of total sales. Will it suck to pay that bill? Yes. Will I look at any all possible reasonable alternatives? Absolutely.

As for selling, if you are ambiguous about the future of your vending career then you need to figure out what you want to do first. This is a hard business, no question about it, and many find after a couple of years that it is way more work than expected. There is nothing wrong with choosing another path if that's the way you want to go. If its not gas, there will be something else that causes a problem, IMO you should not let the excuse of high gas prices be the reason you sell your business.