FOCUS: The gas crisis
Gas prices drive up the cost of delivering everything
Fuel costs hurt pizza and other doorstep services
It’s really starting to add up. Some Buffalo pizzerias have raised delivery fees up to $3 to cover rising gas prices.
A local party rental company tacks on an extra $10 “fuel and delivery” charge when dropping off a tent.
One landscaper adds a $10 fee to the bill for every visit.
“It’s killing me, it’s killing the drivers, it’s killing business,” said Jim Nazaruk, owner of Bonetti’s Pizza on Walden Avenue on Buffalo’s East Side.
In Buffalo and across the nation, businesses have added extra fuel fees to try to make up for soaring gas prices.
Nazaruk, like many other pizza shop owners, added a $3 delivery charge for his pizzas over a year ago. And even though gas has gone up since then, he’s afraid to raise it any more.
He had always made it a habit to charge roughly the same amount as the price of gas: $1 for a delivery when gas was $1 a gallon, $2 when it was $2 a gallon and so on.
“I really should be charging $4,” Nazaruk said, but he’s already losing customers as is.
Predictably, his drivers are making less in tips. Nazaruk said people think the delivery charge is a tip, when really it’s just an attempt to reimburse his employees for the cost of getting the pizza to the customer’s front door.
Customers are also becoming more selective as prices continue to increase. Nazaruk said he routinely gets calls at his pizzeria from people who are comparison shopping. They call, ask how much the pizza is plus delivery costs, and then say they’ll call back. But they rarely do.
“Even if they have to sacrifice quality for a cheaper price, they will,” he said.
Chain pizzerias are feeling the pinch, too.
Among the big three pizza chains, free delivery used to be a mantra. But now Pizza Hut, Domino’s and Papa John’s are all charging to bring the pie to your pad.
Most of Domino’s locations began tacking on delivery fees as far back as 2003 to compensate for a variety of rising costs, including fuel, according to company spokesman Tim Mc- Intyre.
The amount varies by region, and many have instituted sliding scales that rise and fall with gas prices.
Andy Freitas, who owns 51 Papa John’s franchises in the Washington, D. C., area, started adding a $2 delivery fee to orders about two years ago as gas prices started to creep up. Although the money helps pay drivers’ salaries and reimburse them for some of their mileage, Freitas also said that customers think delivery fees replaces a driver’s tip. Not so, Freitas lamented.
“They are tipped employees,” he told the Washington Post. “They’ve got to break even getting to your door.”
A representative for Pizza Hut declined to comment to the Associated Press, but a reporter was charged $1.85 for delivery of a $12.99 “Ultimate Meat Grill” pie last week.
For many small businesses, raising prices to compensate for the cost of gas means they would no longer be competitive. Even if they’re losing money, there is nothing they can do to stop it.
For Mike Siejak, owner of Construction Builders in Lewiston, gas prices are taking a much larger toll than just hurting revenue. It has cost his wife’s health care.
“The extra $200 or so a month that went to her health plan now goes to gas,” he said. Siejak stayed insured so that his children, ages 3 and 1, would remain covered.
“Free estimates are killing me,” Siejak said. He is a one-man business, and driving around town to give estimates eats his profits, and many times doesn’t lead to jobs. If people get a cheaper estimate from someone else, they’ll take it.
“Costs of materials go up. Costs of gas prices go up. Salary goes down,” Siejak said.
For some farmers, not doing as much business is saving them money, according to Ronald Yetter of Winter’s Farm in Orchard Park.
Yetter said he’s noticed fewer competitors at the farmers’ markets recently.
“Some [other farmers], they won’t come because of the gas prices,” he said.
Saturdays are especially tough for Winter’s Farm because it travels to five farmers’ markets throughout the region. The farm has had to increase fruit and vegetable prices by at least 50 cents for some items, and sometimes $1 or $2 more to make up for the gas costs.
Like many, Yetter had to pass the price of gas on to his customers.
Dave Anthony, owner of Dave’s Snow Plowing and Landscaping in Getzville, has tacked on a couple extra dollars to the price of his services. Just a few months ago, he was paying $3,500 each month to fuel his trucks and equipment. Now, he’s paying $5,500.
“Everybody’s prices are going up,” he said.
No one knows that better than Hank Balling, president of Arbour Construction Management on Pearl Street in downtown Buffalo. Part of his company’s job is to advise construction companies on how to keep costs down. Lately, Balling said, it has not been easy.
The cost of the materials for construction companies has gone up because of the added expense of transporting it.
“It’s all gas-driven,” Balling said.
More and more Western New Yorkers say they are not only cutting down on trips, but also buying less when they do go out.
George Miller of Kenmore, a retired teacher, hasn’t driven in almost three years, but he’s still feeling the pinch. Miller said the bus is more crowded than he’s ever seen it before.
“My Social Security and retirement don’t cover much,” he said. He makes fewer trips to the grocery store and buys less.
Debbie Critoph of Hamburg says her weekly grocery bill jumped $25 in the past few months.
“We don’t go out anymore, only on special occasions,” said Critoph, who works in Bryant & Stratton College’s financial aid department.
Even when her family goes out on their boat, they don’t go anywhere. They float in the water just outside the marina.
