Copyright 2000 The Denver Post Corporation
The
Denver Post
June 10, 2000 Saturday 2D EDITION
SECTION: BUSINESS; Pg. C-01
LENGTH: 374 words
HEADLINE:
Gas prices putting squeeze on small businesses
BYLINE: By Nina Rao, Special to the Denver Post,
BODY:
The rising cost of gasoline
is making free deliveries too expensive for China Hill.
'We
have to spend more on gas, so our profit is lower,' said Wah Vo, who
has worked at the restaurant since it opened seven years ago.
The Capitol Hill restaurant is not alone in scrambling
to adjust to the highest gas prices in two decades.
Small businesses all over Denver say they are smarting as gas
prices rise and they are unable to immediately raise their
prices in response. To offset the cost of gas, the management of China Hill
is considering upping the price of menu items. They cannot charge
for deliveries because they advertise them as free.
'We
haven't decided what to do yet,' Vo said. 'We don't know what's best
for us.'
The restaurant is feeling the squeeze from more
than deliveries. The raw goods upon which it depends have
sometimes come late as those delivery companies try to save gas
by consolidating runs.
With the average price of regular
unleaded at $ 1.56 a gallon nationwide, by the American Automobile
Association's estimate, it's no wonder. Adjusted for inflation, the
price is the highest since 1980, when drivers were, on average,
paying the equivalent of $ 2.66 a gallon, including taxes, for all
grades of gasoline, according to the Lundberg Survey Inc.
Experts attribute this year's rise in prices to
production cutbacks by oil exporters, a strong economy that has
increased demand for gasoline, new clean-air standards and the start
of the vacation season.
Whatever the reason for the increase,
Michelle O'Toole is not happy. O'Toole and her husband have owned Dr.
Drain, a plumbing service, for three and a half years. They have six
vehicles driving about 200 miles a day, which, given the current cost
of gas, is adding up to at least an extra $ 200 each week,
O'Toole estimates. Nevertheless, they have not raised their prices.
'We try to put all of our profits back into our
business,' she said. 'It just makes it so you can't grow as quickly.'
But the company can only sustain the gas prices for so
long by taking it out of its own growth. Eventually, it would be
forced to raise prices, O'Toole said.
LOAD-DATE: June 12, 2000 
