We do about 80% of our deliveries in company cars. The amount of gas we use in a year in company cars is about 2000 gallons. Therefor, if the price goes up by a dollar it costs us about $2000. Increasing the delivery charge by 10 cents covers it. I guess we will see $5 gas within a year or so. We raised our delivery charge by 50 cents last december so we are covered on that.
So no, the cost is not a big deal. The increase in the price of flour is 4X as big as a $1 increase in gas on an annual basis and the increase in cheese is 10X.
Where to find the 30K in increased food costs, the 2K price of gas and the 40K more I am paying employees than I was couple of years ago?
Sales are up, so that is good. I track food, supplies and paper together. We have put a price increrase in place a few months ago. We focused on portion control in staff training and I have tied cost control to the manager and assistant manager bonuses. The food/supply cost is up by 2% of sales. Labor is down as a % of sales.
One pieceof good news, consumers notice the price of gas and can make the connection to costs at a delivery business which helps with the price increase acceptance.