Rising fuel costs hit businesses in Ottawa, forcing some owners to adapt

As fuel prices continue to climb, small businesses in Ottawa say they are preparing to adjust. CTV’s Kimberley Fowler reports.

After a bit of a rebound to start of the year, confidence in Canadian small businesses is slipping again, as fuel and energy costs continue to go up and uncertainty from the war in Iran remains.

A new report from the Canadian Federation of Independent Business (CFIB), shows many business owners are feeling the financial strain and pivoting operations to offset those rising costs.

Many small businesses are worried about their bottom line, but the Ottawa-based delivery business Trexity is bucking the trend.

“The first thing we’re seeing within this first two weeks is more and more consumers wanting to drive less and then leaning on their favorite retailers to say, send it to me,” says Alok Ahuja, Trexity CEO and co-founder.

Demand for Trexity services is up, and the company is offsetting the fuel costs for now. However, Ahuja isn’t ruling out a fuel surcharge if gas prices continue to go up. It’s something the company did as their business took-off during the pandemic.

“It’s only been two weeks, but what we’re seeing is the increase in volume is allowing the couriers to make more money…it’s a fair trade-off. We’re going to monitor this closely and see what it looks like week over week,” says Ahuja.

“We’re going to look at the data and lean on our focus team of couriers that we talk to all the time and understand what’s happening within those markets, and if we have to reincorporate the fuel surcharge to bring that back, we will.”

Many other businesses are less optimistic.

The CFIB report says business are worried about rising costs, including fuel, that are making it harder to stay afloat.

“As cost of transportation goes up, that means the cost of the input product is eventually passed down to the small business owner who can only absorb it for so long until they themselves have to pass it down to their customers,” said Christina Santini, CFIB director of national affairs.

The report also shows 58 per cent of small businesses are concerned about rising energy costs, and when costs go up something must give.

“Fuel prices and why it impacts small businesses so much is simply because it’s a key input. It’s used in transportation, it’s used in heating, and it’s going to be felt across the supply chain,” Santini said.

As businesses brace for a trougher road ahead, the rising cost of gas could hit the Ottawa Police Service and the City of Ottawa. The Police 2026 budget was built around fuel priced at $1.42/L.

The City says it hedged its fuel budget for city services and OC Transpo to account for volatility in the market.

Overall, Canadian businesses aren’t pushing the panic button just yet, but with the uncertainty of the war in Iran, there’s no telling when — or if — gas prices will go down.

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