Gas stations: We're the gouging victims

Source: CNN

NEW YORK (CNNMoney) -- -- Think you're mad that gas prices are still high, even as oil prices are falling? Gas station owners in New York, Maryland and other states are furious about that, too, and they're blaming their suppliers for gouging them.

And some state attorneys general are taking notice.

New York Attorney General Eric Schneiderman has initiated a probe to see if gasoline suppliers are gouging or otherwise manipulating prices. His office has received numerous complaints from gas station owners since February.

New York state law prohibits suppliers from taking unfair advantage of consumers by charging grossly excessive prices for essential consumer goods or setting different prices for different areas in the same market.



Read more: http://money.cnn.com/2011/05/18/news/economy/gas_stations_accuse_suppliers_of_gouging/index.htm?hpt=T2

This is why stand alone stations are practically non-existent. They all have to sell a lot of other items (food, lottery tickets, etc) in order to make any sort of profit. The very small profit on gas alone is nowhere near enough to cover just labor costs, never mind all the other associated costs of running a business.

So don't do a drive-off, and if you notice a price error tell them. (One poor guy recently lost thousands due to a price error in his pumps.)

:kick:

I think it is more us getting killed by Wall Street. The way the futures market works affects price and it has been wildly volatile day to day. I think my supplier is suffering as they own many stations. They are trying to sell them off and have closed a few. Cash flow is a problem at many little stations because of the fast rate of increase, cost of the gas in the ground average has gone up, and if you have local credit accounts, you get killed. I do see signs of it stabilizing downward though. I saw cost down about 60 cents from its high the week before. I sold a load at a 3 cent loss that week cause I got a load on the highest day (up 22 cents from the previous day and then down 26 cents the next day), not considering credit card fees and of course tax on sales dollars where even if you are netting a few cents a gallon profit, we are taxed on total sales at the end of the year the same as a high profit store with sales of goods such as a Wal-mart. Selling 2 or 3 million dollars in gas is a lot less profitable than selling 2 to 3 million in clothing and appliances... sigh.

And some of the ones that have been there a while are changing brands like they're going out of style.
WTF is up with this?

Either the big box stores have put them down, or the cash flow issues when prices double in such a short period of time they don't have the resources or cash and fall behind with suppliers. Effectively its a spiral few climb out of. There is so little money to be made owning a station nowadays unless you are like a royal farms or wawa where they build palaces and do so many other things beyond just selling gas cheaper than anyone else. They can absorb the cost increases much easier. Changing brands happens when your contract with a supplier is up, and it used to be a good payday because they would upfront you money to change. Now those days are kind of gone, they might remodel signage only and then if you break the contract you owe them back for the signs and for their future profit losses. It is what it is.

alternatives?

Volume has decreased in my opinion because vehicles are far more fuel efficient. The big boxes have taken over in many places too. They are like the Walmarts of the gas industry, or the Riteaids and Walgreens in the pharmacy market. I don't see much emergence in the electric and alternative fuel car market yet, at least in my area. I would assume we all evolve or just change when they do.