NOTEBOOK: The Impact of Gas Prices
© 2006 Heather Craig

NOTEBOOK: The Impact of Gas Prices

Recent study identifies that most North American small businesses are experiencing fuel spike woes, but Michigan small businesses as really feeling the hurt.

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Call me Captain Obvious, but gas prices are putting a significant dent into 2022 profit margins and the ability of small businesses to bounce back from the business obstacles of the last two to three years. And recent gas price research conducted by Alignable of nearly 6,500 small business owners reflects nearly two thirds (68%) indicate that gas price spikes have had a "very significant' negative effect on their business recovery.

Alignable, who conducted the research, is an online referral network for small businesses with more than 7 million members across North America. They also track and report on business trends that impact the small business community.

In addition, Alignable's research found that not only are gas price spikes impacting those businesses that consume a lot of gasoline diesel as a part of doing business, but also those companies that rely on "trucking" to receive or send materials and goods. These added expenses are being passed down to the small business owner, as well.

Another interesting bit of information from Alignable's research is that while the recent gas price spike affects all small business owners, it seems to impact minority-owned businesses at a bit of a higher rate compared to non-minority owned businesses (74% compared to 66%, respectively).

And it appears that Michigan small businesses are really feeling the hurt, with 78% of owners claiming gas prices are hurting their recovery efforts. According to Alignable, "Michigan is often at or near the top of our list for small business rent delinquency and for states having the hardest time recovering. So, yet again, Michigan is atop another list of small businesses struggling, which must be frustrating for that state's small business residents."

Many states have at least 60% of small businesses pointing to gas prices as a major stumbling block on their road to recovery, according to the data. These include California (68%), Virginia (65%), North Carolina (64%), Ohio (63%), Pennsylvania (63%), Illinois (62%), and Massachusetts (61%). Some 60% of small businesses in Florida, New York, and Washington State are struggling with gas prices, too.

The state with the lowest incidence of gas spike issues is Colorado, with only 47%.

Our Canadian to the north are having similar issues, according to the research. Overall, 64% of Canadian small businesses said the negative impact of the recent gas price spikes is "very significant," compared to 68% in the U.S.

AB tops the Canadian chart with 70% of its small businesses struggling with gas prices. Ontario comes in at 64%, and BC is around 61%.