What's up with off road fuel prices??

[Diamondpilot]

I had the same thoughts as many of you about gas stations until about 10 years ago when my uncle bought a Shell Station.

There is more than meets the eye. His lot is small but in good location and cost him nearly 2 million dollars. All because of location. His taxes on this lot are more than what 4 family's earn in a year. He has 25 employees. It cost lots of money.

He on average sells his gas for $.10 per gallon over his cost. Now here is the kicker. Most credit card fees are about 2.5%. So on a $3.00 gallon of gas there is $.025 profit. Now the average sale is about 15 gallons so that makes him a profit of $1.50 if they pay cash and $.37 if they pay with a card which about 75% of his customers do. Remember, this is before he pays his mortgage, insurance, employees, taxes, electricity, phone, ect. The profit margin is not what you think.

If it was not for the cigarettes, candy bars, soda's, beer, ect you could not make it. Don't get me wrong, he makes a good living but is by no means rich. Buying gas like he does, 20,000 gallons at a time, is a gamble. He can make a purchase at 7am and the cost can drop a few cents later in the day equaling a net loss of well over a $1000. Its like the stock market.

There has been weeks where everything is said and done and he and he is $5000 in the hole. Then there are weeks where he makes $10,000. Its a law of averages. He spends many days and nights wondering how he is going to make pay roll.

Again, do not get me wrong. They have a good life, not a great one. They have a 1970's home of about 2,000 sq ft. He drives a 2005 truck and my aunt has a 2007 Focus. They have a 2001 boat and take a few vacations each year. He has said many times he could make what him and my aunt make combined with a good office job.

Chris

 

[lostcause]

i don't know all the ins and outs of it, but another thing about pricing comes down to brand name. if the gas station carries the name of a well known oil corporation on it, they have to buy their fuel through the parent company, and the price is pretty well set. if it's just mom & pop's corner store with a pump out front and no indication of who or where the fuel came from, they have the luxury of being able to buy unbranded fuel and can work with whoever will give them the best deal. at least that's what i've heard around here.

 

[DarrylH20]

the reality is, they charge more because they can!

bend over What really sucks is this is all we can do:ashamed:

 

[clemsonfor]

i don't know all the ins and outs of it, but another thing about pricing comes down to brand name. if the gas station carries the name of a well known oil corporation on it, they have to buy their fuel through the parent company, and the price is pretty well set. if it's just mom & pop's corner store with a pump out front and no indication of who or where the fuel came from, they have the luxury of being able to buy unbranded fuel and can work with whoever will give them the best deal. at least that's what i've heard around here.

i THINK THIS IS CORRECT TO A DEGREE (Sorry for all caps, just noticed). But there is a huge tank farm located in N. Augusta SC right on I-20 just before you hit GA (well about 15 miles before). This is the supplier for many stations all the way up past my home down to the bomb plant (SRS for you learned types) and over to Columbia. Someone directed me to a site that lists the fuels they carry and type. I looked and when on there (this tank farm is a seperate company) it lists the supplier as Shell. My thoughts are that the Shell station is higher cause of Franchise fees etc and location which negate a price. If you pass that tank farm any day of the week from 7am to 5pm there is a line of trucks backed down the access road up to the main road that crosses over the interstate. It looks like they have 6 or so stations to fill trucks at the same time and i guess there may be anywere from 10-30 tank trucks lined up waiting on fuel at any point, usually on the higher side of that estimation. My point here is that yes some of the trucks say Shell on them but others are just plain silver that maybe say Nowhereville Oil Co. on the side some may say Eagle or Popeye (or whatever some of those other companies are these i think are companies but cannot say positively weather they are getting feul there or not). They all get fuel and deliver to the Shell stations as well as all the Mom and Pop stations. Mom and Pops delivery may come from Nowwhereville Oil and the Shell's may be delivered from The Shell Truck but they all came out of the same tanks originally.

It also could be argued that at this point Shell adds its fuel cleaner additives or whatever negating a higher price, i have no idea. I just know almost all fuel in my area originates from there, then its distributed by smaller compies either direcly to your tank or the company takes it to their storage tanks and then makes diliveries from their tanks. And yes this is the source for all our NO ETHONAL fuel in this area.

 

[rus_geek]

Stopped to pick up five gallons of off-road this week, and noticed the on-road is cheaper at the pump! Granted, it's only eight cents, but we have about $0.57 of taxes, so it's quite a price difference. Talked to the station owner and right now the off-road is straight #1. On-road is #2 with "a flow modifier" for the winter.

-rus-

 

[Duffster]

Stopped to pick up five gallons of off-road this week, and noticed the on-road is cheaper at the pump! Granted, it's only eight cents, but we have about $0.57 of taxes, so it's quite a price difference. Talked to the station owner and right now the off-road is straight #1. On-road is #2 with "a flow modifier" for the winter.

-rus-

That still doesn't justify that price difference. Here the difference between #1 and #2 is about a quarter not the mention the fuel treatment for the #2 isn't free.

 

[bayoulee]

When I was running my skid steer and tractors a lot, (15 yrs ago) and bought my first diesel pickup, I believe I was paying around 80-85 cents a gallon for red. Thats why I bought a little gas utility tractor. My next pickup will be gas also.

 

[Duffster]

When I was running my skid steer and tractors a lot, (15 yrs ago) and bought my first diesel pickup, I believe I was paying around 80-85 cents a gallon for red. Thats why I bought a little gas utility tractor. My next pickup will be gas also.

What's your point again?

 

[clemsonfor]

In a utility tractor you cant use enough to justify a reason not to buy deisel. My buddy will burn at least 2 times the fuel i do to do similar work in his gas JD tractor. Now he has 1.5 times the power but were talking mowing a given area so the power here is irrelevant.

 

[coobie]

I've bought from the same company for about 15 years. I am not a big customer. I generally go through between 1000 to 2000 gallons a year. I'm well aware that some go through that in a week or less. Anyway, here's my issue; I called yesterday to buy about 700 gallons and was quoted $3.40 per gallon for dyed #2 off road diesel. WTF?!

I explained that the station right down the road from me was selling on road; taxed diesel for $3.10 a gallon. I'm rather confused as to how not paying roughly $0.40 cents (or so) in road tax and buying in somewhat of a bulk purchase warrants $0.30c more per gallon than taxed on road diesel at the pump. When I inquired about the conundrum, they pretty well said "Do you want us to deliver fuel or not?" Clearly, the answer was "not".

I filled my pickup, about 30 gallons, and the 100 gallon tank in the back at $3.10 a gallon. Came home and pumped the 100 gallons into my larger tank and went back and bought another 100 gallons for the fuel tank in the back of my truck. It was too late and I was too cold to make another trip.

I see that fuel jumped up about a quarter a gallon today, but still, I have to wonder about dyed #2 being more expensive than taxed, non-dyed #2. That just doesn't make sense to me. Anyone else notice anything like this?

Dargo,I just seen your post.I filled my(Dec 1st) overhead 300 gal.diesel tank with #2 diesel my price was $2.42 per gallon delivered to my house and I payed road tax.I had to purchase at least 300 gal.coobie