Volume 42, Issue 8 - August 2007
Distribution & Production
Glass Industry Reacts to Rising Gas Prices
“Every time you turn around you have to fill up the engines again,” says Marie Staub, sales manager for Colonial Mirror and Glass, a fabricator located in Brooklyn, N.Y., Minneapolis Glass Co. in Plymouth, Minn., also has felt the crunch.
“We do delivery on our own trucks of most of our products,” says Jennifer Lang, president.
Dana Zaring, secretary for Fort Mill Industries Corp. (FMI) in Rock Hill, S.C., says that fuel costs have “changed drastically” in recent months, but it hasn’t impacted the areas to which the company delivers its products.
“It’s not changed anything as far as where we go,” Zaring says.
Then how does this rise in fuel prices impact the customer? The when, rather than the where.
“They [customers] want their material tomorrow and I can’t get it to them because I’m not sending a truck a couple of hours away for one order,” Staub says. “They have to wait.”
These companies are aiming to tighten delivery schedules so gas is not wasted on repeated trips.
“We just have to make sure we’re operating as efficiently as we can,” Zaring says. “If a customer has two deliveries in one week, we ask them if we can deliver to them once.”
Minneapolis Glass has done the same.
“We routed our trucks so we go to a territory with a full load rather than going to a territory light,” Staub says. “We optimize every inch on the truck. Instead of going to a location three hours away everyday, we’ve rotated our schedules so we only get to that territory twice a week.”
“We try to make our routes make as much sense as possible,” Lang adds. “If we were going someplace twice a week … we may be trying to consolidate to once a week.”
Staub advises that glaziers take this growing expense into account.
“Anticipate your needs before it becomes an emergency so your suppliers can at least book the orders to make one grand delivery to you instead of five small ones,” she says.
In addition to rearranging schedules, some companies are able to pass fuel costs onto customers.
“We have to absolutely make sure … any fuel costs we have to include in our quote,” Zaring says.
Other companies aren’t able to make such allowances, though.
“We have not been able to pass along a lot of the costs to the customers,” Lang says.
Lang explains that most customers wait for the increase of raw materials as a sign that costs will be rising, and rising gas prices aren’t explanation enough for an overall cost increase.
“Most of our customers rely on the increase of raw materials as their OK,” Lang says. “Because we haven’t had a glass increase in a while it’s been tough to pass those overhead [costs].”
The price of shipping to fabricators has also been impacted.
“We have to pay a fuel surcharge on deliveries coming to us [from float lines],” Zaring says, “and that doesn’t include our natural gas surcharge.”
Staub adds, “Our industry has been hit with fuel, energy surcharges and they fluctuate with the price [of oil].”