Businesses eyeing escalating gas prices
SUMMIT COUNTY – With every penny gas prices go up, so does Glenn Morse’s anxiety.
The Breckenridge Whitewater Rafting owner knows the hikes affect his business, but he’s not sure what to do about it.
“We can’t just raise our prices,” he said, noting that it would put the company at a competitive disadvantage. “If it got excessive, we’d definitely have to do a gas surcharge. We take a hit once gas prices get into the $1.75 to $1.80 range.”
His company shuttles about 3,000 customers each summer to the Arkansas, Colorado and Eagle rivers, and rolls the costs of everything – wetsuit rental, transportation, the raft trip itself – into one fee.
He believes he might have to tack on a $1 or $2 per person gas surcharge if prices at the pump get way out of hand.
Rafting companies are used to riding the waves that come their way.
“Whenever we start doing well, something happens,” Morse said. “One year we’ll get no water, another year, gas prices go crazy. The customers are the ones that eventually eat it. It’s getting harder and harder every year.”
Corry Mihm, executive director of the Breckenridge Resort Chamber (BRC), is looking at how the increased gas prices might affect travel plans.
“We’re viewing this with much trepidation,” she said. “If they’re talking about record gas prices, and the majority of our summer business is the drive market, we don’t know what that pain threshold is that could cause people not to travel. That’s the concern. Unfortunately, it’s one of those things you can’t do anything about.”
The BRC is in the midst of its summer marketing planning and might revisit its strategy. But this year that could be tough.
“A couple of years ago, when there were a lot of airline concerns, we could shift (marketing efforts) between the fly and drive markets,” Mihm said. “With gas prices going up, it affects both markets, so we have less ability to shift.”
Mihm doesn’t think rising gas prices will affect day-trippers from the Front Range or those who have made plans for major events, such as weddings or family reunions.
Bill Watterson, director of the Summit Stage public bus service, is planning for anything.
“I’m very aware fuel prices are going to go through the roof,” he said. “They’re talking more than double-digit increases in the percentage of fuel costs that we’re going to have to adjust for.”
He hopes an economic recovery will increase sales tax revenue, some of which is dedicated to transit.
“It isn’t a pipe dream to think the revenue situation would turn around,” he said. “Some are saying we’re about as bad as we’re going to get, but others think it’ll get way worse.”
Another thing going for the Stage is that last year, the board crafted its budget based on an expected 10 percent downturn in revenue. That came in at only 3 percent, essentially banking $425,000 for the service. Watterson said that money could be tapped to address rising fuel costs this summer.
“We feel pretty confident that that money is enough,” he said. “Nevertheless, having fuel prices higher than they’ve ever been will be a challenge. We’ll have to set aside more resources for fuel than we’ve anticipated in the past. It’s very dependent on how high prices go and how long they stay there.”
If costs jump too high, the board would outline alternatives.
“It’s too early to say what we’d consider,” Watterson said. “I don’t think there’s interest in cutting back service. We’ve just been through a couple of years of successfully cutting back costs, and what remains is few and far between.”
Like Watterson, Breckenridge’s transit director Jim Benkelman doesn’t anticipate a decrease in the town’s bus service.
“We’re scared of the rising prices screwing up our budget,” he said. “We’re not alarmed as of yet, but unfortunately, it looks like, come mid-summer, prices will get out of hand. I’m nervous.”
Morse is optimistic, however.
“Everything’s probably going to be OK for us; it’s not looking bleak,” he said, adding that many raft companies stay with it because of their love of the sport. “We’ll plug away like we always do.”
Jane Stebbins can be reached at (970) 668-3998, ext. 228, or email@example.com.
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