Higher fuel prices impact lifestyles Have you been able to recoup any of the higher costs that you have been paying for energy including fuel for delivery trucks and other utility vehicles, fuel to operate boilers and heaters and electricity to operate fans and cooling systems? Michigan State University district extension horticulture educator Tom Dudek writes in the university's May 13 Greenhouse Alert that most retail growers raised their prices because costs have gone up. Even though these growers control prices, he said some have chosen not to raise them. He sites growers not knowing their true costs, including accounting for family labor, depreciation and marketing, as a primary reason for the failure to raise prices. Another reason maybe the growers' misconception that price is the only factor that impacts sales. Consumers are well aware of the impact higher fuel prices are having on the economy -- especially theirs. The Fort Worth Star-Telegram reported that 60 percent of Texans in a May Scripps Howard poll indicated that gas prices above $2 were causing them economic hardship and that they were making changes in their spending to offset the higher prices. Sixty-four percent of the survey respondents indicated that they had reduced their amount of driving. The higher fuel prices were also impacting their lifestyles with 53 percent cutting back on the times they dine out and 45 percent not going to see as many movies. This means there's opportunities for them to do other closer-to-home activities like gardening. A similar ABC News/Washing Post national poll concerning $2/gallon gas conducted in March found that 57 percent of consumers believe higher fuel prices are causing them financial hardship. The poll reported that lower income households were encountering the most difficulty. Helping mass merchandisers go upscale, up price Wal-Mart is blaming higher fuel prices in part on its failure to meet Wall Street's first quarter earning projections and the world's largest retailer is expecting slower sales during the second quarter. Higher gas prices are causing the retailer's core customer base to start from a deficit, FTN Midwest Research retail analyst Jeffrey Stinson told USA Today. Compounding the retailer's problems was a cool wet spring in many parts of the country, which impacted sales of higher margin seasonal merchandise including lawn and garden products. Deutsche Bank retail analyst Bill Dreher told USA Today that Wal-Mart's inability to sell seasonal merchandise during the first quarter and the consequent price mark downs it's going to have to make to clear out this inventory will have an impact on other retailers. Other seasonal merchandisers will be forced to lower their prices. One result of the Wal-Mart mark downs, Dreher said, is that it will draw in higher income consumers. This customer segment is one Wal-Mart is working to attract with more tiered merchandise -- carrying lower-price base items along with more upscale, pricier models. The increased use of marketing programs, point-of-sale merchandise and expanded implementation of pay-by-scan may give more growers an opportunity to raise their prices to cover increased costs. If higher energy costs lead to consumers spending more time at home there is greater opportunity to show them what flowers and plants can do to enhance their quality of life. Send this article to a friend Enter your e-mail address: Enter your friend's e-mail address: Click the image below to send: © 2004 Branch-Smith Publishing