View Full Version : Good Idea?
06-14-2000, 03:31 PM
I'm no economics expert or anything, but it seems to me that a gas station would be able to rake in a butt-load of money if they implemented the following (or a reasonable facsimile thereof):
Advertise in as many arenas as possible the fact that on a certain date, your station will be selling gas at X price (where X price is MUCH lower than your competitors and is just high enough for you to cover cost of the gas, taxes, etc. and make about 1 cent on the gallon).
Actually do it, and have a few full tankers standing by so you don't have to turn people away.
Now, is it just me, or would this make a bunch of money for the station because of increased business?
Do you mean just increased business for the day, or more regular customers?
As far as the day goes, it would depend on how much profit you make when you're NOT charging such a low amount. if you make 20 cents on the gallon now, you'd need 20 times as much business in a day (assuming your 1 cent per gallon suggestion). That's a LOT more business, and it would be hard to put up numbers like that.
As far as regular customers go, I would guess most people's main reason for picking a station is convenient location (maybe near their house, or work, or right off the highway). With this gimmick, your excess customers for the day would come from other locations, but after that day, with no real incentive to return, would probably go back to their old stations.
I wonder how much additional overhead (what with needing extra tankers or whatever) would be involved in the stunt, and whether you could even pull it off and make a profit.
06-14-2000, 05:08 PM
Several gas stations in my area have done this lately, but I have no idea if they made money or not. They did get free news coverage, and there were assloads of people there. So many in fact, that it seemd like a much bigger hassle than it was worth.
06-14-2000, 06:34 PM
I always buy my gas from the same station, regardless of price. It's a convenience thing, I'm not gonna drive 4 or 5 miles out of my way to save a nickel a gallon. Even if I fill up with 16 gallons, that's less than a buck. If the price difference is more than a nickel, see Dumbguy's post. Too damn many people.
06-15-2000, 09:34 AM
If you can't find 25¢/gal difference in an area, you aren't near me. And some people pay 35¢ more than I do for regular.
That's $14 a fill-up for my truck, well worth taking the right way home.
Myron Van Horowitzski
06-15-2000, 10:21 AM
Gas stations started a great gimmick back in the Seventies:
Pump Your Own Gas and Pay Less!
06-16-2000, 09:36 PM
I knew a guy who owned a station. According to him, gas station profits are miniscule anyway - most of the profit goes to Texaco, Amaco, or whatever. If they lowered their prices, they'd still owe the chain the same amount, so they'd be screwed. He was just squeaking by, and his station was on a major highway - the first station coming into a remote town. Just to give you an idea, he said he made more money off a candy bar than off a gallon of gas. Which explains the rapid proliferation of convenience stores at stations.
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