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Rising energy costs hit small businesses hardest

The US Small Business Administration (SBA) Office of Advocacy released a study today showing what most small businesses already know- that they're getting scorched by rising energy costs.

According to the study, the small manufacturing and small commercial sectors top the list of burdened industries, on an energy cost per value of industry shipments and an energy cost per sales basis.

The report finds that for 10 of 17 manufacturing sectors for which data were available, small firms spent considerably more for energy than large firms did, on a per value of industry shipments basis. For food manufacturers, leather and allied products manufacturers, and computer and electronic products manufacturers, the costs per dollar of output were more than double those of their larger counterparts.

The author also finds that in 26 of 31 commercial industries studied, small firms have higher energy expenditures on a cost per dollar of sales basis. The median commercial sector industry has a small entity energy cost per sales ratio that is 2.7 times the ratio for large entities.

What the report doesn't cover, is what small businesses can do about spiraling energy costs. Although there isn't a lot that can be done, small improvements can help at least a little.

For instance, keeping your vehicles tuned-up, grouping service calls by location when practical, and using a GPS tracking device to make sure your trucks or cars are where they are supposed to be can reduce fuel costs. So, too can using bicycles for delivery where practical instead of a car.

Shutting doors, using a programmable thermostat (that employees can't access) to lower or raise the temperature when no one is in the building, and adding more insulation to buildings or home offices can help minimize increases in heating and cooling costs.

Posted by Janet on April 22, 2008 at 8:45 PM | Comments (1)

Comments

It dosen’t appear this will be looking up anytime soon… What ever will we do? Probably this will cause some things to happen faster, that are good, we might not know it for a bit though. And no, I don’t own any oil stock.

Posted by: low Cost Business Idea on April 29, 2008 at 6:06 AM

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