By Sandra Taylor-Sawyer, Ed.D.: Guest columnist
Last month’s article provided ideas business owners can implement during the difficult economic climate.
As a continuance, I spoke with one of Clovis’ longtime business owners, Tom Martin of TS&S Eateries, known as “Taco Box,” on how the current economy has impacted his business.
Martin stated one impact is with food prices: Tortilla costs rose 20 percent to 30 percent and suppliers are charging a fuel surcharge. In addition, minimum wage has increased by 27 percent — with wages one-third of his expenses it has had a negative impact to the bottom line.
Raising prices is not always the first consideration when a business experiences increases in cost. Increasing prices appears to be an unthinkable alternative; a taboo of sorts as it seems unfair to pass the cost on to consumers. However, in order to remain in business, each service or product the business sells must be reviewed for its cost, profit margin, waste and the overall impact on the business.
In order to reverse the downward trend, Martin reviewed his product line and determined he could raise prices on some items and actually decrease prices on others. The latter strategy afforded him the opportunity to promote a successful price reduction sale.