In article <op.swf9uud0xevqpy@mail.comcast.net>, 03dakotaCC4.7_4x4@comcast.net
(droo) writes:
>
> I was listening to the radio here in NJ today and this, of course, was a
> big topic of conversation. I learned a few things about gas stations and
> their pricings. For one, according to the radio it is illegal here in NJ
> to sell gas less than what you payed for it. Sounds right. That is really
> in line with the laws that prevent you from underselling your product to
> drive your competitor out of business. As far as getting deliveries, a lot
> of places get them every other day. Of course if you live in a less
> populated area, this may not be the case, but this is NJ. A lot of these
> stations here are raising their price because of the wholesalers raising
> their price. The stations seem to maintain whatever markup they have. I
> heard one caller talk about her husbands business marking it up 7 cents
> per gallon on regular. Another caller said she worked for a company that
> owned stations and their markup on regular was around 20 cents. When you
> sell 10,000-20,000 gallons a week, that is a healthy profit stream. But
> there really isn't too much room to move on a 7 cent markup.
>
.20 markup on 20,000 gallons per week is only $4000.00 then subtract payroll,
taxes, licenses, insurance, utilities, etc. Not that great of a profit margin
when you really think about it. In reality, a 20-cent markup per gallon is not
the norm. Most stations only make 2-5 cents markup on gas. If they go much
higher than that, volume drops dramatically and they make even less. Back when
I was in the towing business, the station at the shop I worked out of only made
2-cents per gallon on average. When my partner raised it any higher, his sales
volume dropped dramatically because the station down the street was that much
cheaper. There is a reason most stations have been converted into convenience
stores over the last 20 years, there's no money in selling gas. The only people
who make money at it are the big oil companies and the government.
Walt
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