Inflation has directly affected my business through rising fuel costs. I own a small construction company and diesel fuel prices have gone through the roof. The Energy Information Administration statistics show a 68% increase in on-road diesel from June of 2007. An interesting article titled, “Demand Crowns Diesel, Not Gasoline, Cost King” was published by Engineering News-Record shows the concern of local contractors who are fighting to stay in business with rising cost in energy.
I find myself in the same unfortunate position as these contractors. Prices continue to rise and bids continue to remain constant, and we know there needs to be a solution, but when it comes to alternative energies, we are out of our element all together. I would be more than happy to support an alternative source, however as someone with a background in construction, I could only support, not lead.
On top of fueling all of the machinery with diesel, there is a massive increase coming from the machinery manufacturers as well. The Southeast Farm Press published an article entitles, “Deere tractors feature fuel efficiency”, which was about John Deere’s effort to make more fuel efficient machinery. I believe that this is a step in the right direction however through their research and development and increased manufacturing costs, the machinery costs to the machinery operations/purchasers increases as well.
Overall the construction companies seem to be taking a beating from all ends of the spectrum. Something needs to be done, and unfortunately we are going to have to step out into the unknown and seek alternative sources of energy.
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2 comments:
Sorry to hear about your rising production costs, especially when it sounds like customers are unwilling (or unable?) to support a rise in their costs. Doesn't seem like the light's too bright at the end of that PVC piping, but I hope it soon is....
Brendon! I didn't realize how much of an effect this was having on you. I guess I never really thougt about it. Thanks for enlightening me. I do often, when passing by the many many construction companies in our area alone, wonder how all of these and many more stay in buisness. I guess I never really asked an of them. They are constantly so busy too! Wherever you go there is another landscaping, construction, stone masonry, etc company around the corner. How do you do it?
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