August’s inflation report told two stories at the same time. Core inflation, which strips out food and energy, dropped to 2.4%, the lowest reading since March 2021. That is real, measurable progress.
The headline number did not move the same way. It held at 3.4%, and gasoline is the reason. Gas prices jumped 3.9% in August after actually falling in July, and are now running 27.4% higher than a year ago. That single category made up more than a third of the entire monthly increase in prices.
For a business owner, which of those two numbers is “true” depends entirely on what your business runs on.
Why This Matters to Your Business
Most owners do not read CPI reports. They read their bills, and this month those bills are sending mixed signals depending on what’s in them. If you run a fleet, ship products, or depend on suppliers who pass along freight costs, that gas number is not a statistic, it is already on your invoices. If your costs are mostly rent, labor, or software, the cooling core number is closer to what you are actually feeling.
The mistake is treating “inflation” as one number that applies evenly to every business. A landscaping company in Texas and a bookkeeping firm in Delaware read the same headline this month, but they are living through two different cost environments.
The Real Opportunity
A split like this is a good moment to separate what’s temporary from what’s structural in your costs, before Q4 demand locks in your margins for the rest of the year.
What to do this week:
- Pull your last three months of fuel, freight, and delivery costs and see what actually moved, not what the headline implied.
- Decide now whether a fuel surcharge, a small price adjustment, or absorbing the cost fits your business, instead of deciding after a customer already pushed back.
- Separate energy-driven cost increases from everything else in your P&L. If your core costs are genuinely stabilizing, that’s leverage for supplier and vendor negotiations.
- Lock in supplier or shipping rates for the holiday season now, while you still have room to negotiate.
Use the October 15 Deadline as Your Checkpoint
October 15 is the final deadline for individual returns and calendar-year C-corporations that filed for an extension back in the spring. There is no second extension after this one. Before you file, use the moment to look at your full financial picture: do your Q4 margin assumptions still hold up against what gas and freight are actually doing to your costs?
Go to your CPA to fine-tune the details, but arrive more informed by using solid bookkeeping and financial projections.
The Difference Is Preparation, Not Prediction
Nobody can say for certain whether gas prices keep climbing or cool off next month. What separates a business that protects its margin from one that gets squeezed is knowing exactly which of its costs are exposed, and having already decided what to do about it.