Gas for $1.10 / gallon

[nissangirl74]

Nope. Most individual gas stations make maybe 5-10 cents or so per gallon profit.

Yup!

You'd have to sell a lot of other items - even at higher margins, Becky - to make up for deliberately designed gas profit losses intended to get people into the store.

Z

I know what you guys are getting at, I'm just saying it's not a lost cause.

Different scenario.
1) For those three hours, sell gas at cost. That way there is no loss. No profit on fuel sales but no loss either. Then anything extra you sell in the store IS pure profit.

2) For those three hours sell gas just below the lowest discount anyone else is offering. If Fry's has gas for 10 cents off per gallon with their discount card, QT offers it for 15 cents off per gallon; no discount card required. Then it would be easier to make up the (minute) loss inside the store.

[timmy0257]

there really is not a whole lot of markup on the fuel. some stations rather do less volume but gross a higher sale on average. it really works out the same. most profit is in the merch inside the store,.

[Jesda]

This is one area of retail that could really benefit from creativity. The gas and convenience sector hasn't changed much in a century of motoring. It hasn't been modernized at all (other than pay-at-pump card processing) compared to big-box retail.

I'd like to see gas stations with optional no-cost full service, especially in the winter. I don't mean the 30-IQ morons that pump your gas in OR and NJ. I mean trained people who pump without spilling and run inside to fetch you whatever you want. You can get your soda, hot dog, and magazine in 10F weather without ever leaving your car. They'd make minimum plus your tip.

Just throwing ideas out there.

There has to be more to buying gas than Samir's filthy 7-11.

[timmy0257]

i know Samir, too.


=)

in Gainesville they used to have a garage style convenience store. you just pull thru and u buy your beer or whatever you want. u should be able to get gas the same way. great idea

[hbpignosePA]

[quote="nissangirl74] a 12 pack of beer.[/quote]


in communist pennslyvania you cant even buy beer in grocery stores or gas stations.... just recently distributors and liquor stores were closed sundays too

[LongBeachCoupe]

Many gas stations already sell fuel at a loss of a few cents per gallon with the intention of making up the loss with car washes, milk, lottery tickets, and cigarettes.

95% of the NY metro market's gas stations

[nissangirl74]

http://www.thecarconnection.com/news/10 ... d+Blogs%29

The retailer has been hurt by declining in-store sales, as customers see a larger percentage of their household budgets going to pay for things like groceries and gasoline. Discounting fuel is one way to lure customers back to WalMart stores...

i told you so.

[Jesda]

It works, too. On road trips if I see a Murphy/WM gas station (usually the cheapest) I'm inclined to then go into the C-store or the Wal-Mart itself and buy things I'm not entirely sure I need, like Gummy Bears.

[szh]

http://www.thecarconnection.com/news/10 ... d+Blogs%29

The retailer has been hurt by declining in-store sales, as customers see a larger percentage of their household budgets going to pay for things like groceries and gasoline. Discounting fuel is one way to lure customers back to WalMart stores...

i told you so.

Ah, but there it is a large retailer enticing the people into their store - they well might sell enough other stuff to the fuel buyer to make the discount on the fuel be worth it - depending on the discount.

A gas station owner will not be able to make it work in the same way.

Again, my presumption is not "sell the gas at cost to entice the other stuff sales" is the gas station owner's method - 'cause that may (low probability) work for some people/situations. But expecting them to give a significant break/discount (like $0.25 or $0.50 or $1.00 per gallon) in the hope of making that up via other stuff sales is highly unlikely to succeed in the long run.

Z

[Bubba1]

I still think it is possible to make a profit at this but you would have to have the exact cost of gas to find out for sure.

Nope. Most individual gas stations make maybe 5-10 cents or so per gallon profit. Most of their money actually comes from cigarette, soda and food sales.

This is correct. My mechanic friend used to lease/operate a gas station (Getty) to help offset his costs. The margins at best were about $.08/gal, in good months he covered his employee costs, and a little toward the rent, and made most of his money with the auto repairs. In recent years, the oil company margins had been steadily reduced to the point that he had to use money from the repair business to help pay the gas pumpers. that's in addition to the headaches he endured by employee scheduling/absences/mistakes, pump problems, late deliveries, venting by gas customers about prices set by the oil company, splash/dashes (theft) etc. He got out of the gas biz and devotes full time to car repairs. He;s much happier now.

I think a $1 discount per gallon is probably too much for most operators to absorb, except if they can guarantee to recoup the money elsewhere before the customer leaves. Without a guarantee, there's no compelling reason for a customer to spend what they save, in which case the operator is hosed.

[Chaotic_Warlord]

they should actually make it a cash price. that would require guests to come inside and make their fuel purchase, thus grabbing a soda or pack of gum or whatever while they are in there. i know I would. also, they would not be paying merchant fees for the processing of credit/debit.

IMHO, i think it would be wise for stations to make the offering of "cash price fuel" cheaper. it drives more business inthe door and there is far more markup on the merchanise inside the store anyways. you cant sell Vitamin Water, lotto and cigs to a pay at the pump customer. They are in and out.

Up here in the Greater Philly area, particularly in NJ (where gas is cheaper and self service is illegal) I'd have to say that at least 75% of the gas stations have adopted a seperate cash and credit price. Personally I don't like this because I rarely ever have cash on me, if I have cash I'm more likely to spend it than if I just have my card. While I do have a company card to use to put gas in the work truck I still do what I can to save them money (ie look for the cheapest gas I can find, go to stations that don't have a cash/credit price difference). Call me an A hole for doing that considering I work for a major corporation (we're currently owned by Green Mountain Coffee Company), I will do what I can to save them money on fuel prices, most other employees would do what they can to stick it to the corporation, I'm under the delusion that if all the employees did what they could to save money on gas for the company then maybe we would get a little extra in our paychecks each pay period, notice I said delusion.