Restaurants Pay For High Gas Prices
At Relli's Sports Bar in DeWitt, it is the good food and low prices that draw customers, but owner John Coscarelli says those low prices could be changing in the near future.
"We're looking at raising our prices in about a month," said Coscarelli, who has owned the restaurant since 1996.
Coscarelli says he is looking at raising prices around ten percent to pay for gas fees that shipping companies have been charging him.
According to Coscarelli, the high price of diesel fuel is forcing companies to pass on the extra costs to restaurant owners and it has been affecting his profits.
"Some companies are doing $5 to $10 per delivery so that comes right off the bottom line," said Coscarelli. "You get ten to 15 deliveries a week, so you are looking at anywhere from $75 to $150 dollars a week."
To make for those losses, Coscarelli says he has cut down staff hours as much as possible. Now, he is looking at his last resort by raising prices.
"If you pass on to your customers, you could lose your customers," said Coscarelli. "You are always worried about how much you can pass on and how much you absorb."
Hiking up food prices is something Paul Guerrazzi knows all too well.
With gas fees and the rising cost of food, in general, Guerrazzi has already had to pass the costs onto his customers.
"We have tried to minimize as best we could to try and not scare people away with large increases, but we have had to raise prices to survive," said Guerrazzi, co-owner of Guerrazzi's in Lansing.
It is a tough situation for businesses where customer base means everything.
John Coscarelli says the gas fees were added to his bill several months ago and shipping companies say they will continue indefinitely.