Gas Station Sign - Meaning?

“Cheapest price allowed by law” Have you seen this posted at gas stations? What the heck does that mean? You mean to tell me the price is 100% taxes!?!?

Selling gasoline below cost can be troublesome for big companies. I don’t believe that independent stores are restricted, but that might vary by location.

Some states require businesses to sell their products for at least cost, or even with a markup. In Oklahoma, we have the “Unfair Sales Act” which prohibits selling products for below cost, plus

Just digging around a bit, I turned up this case where one oil company apparently sued another oil company for selling gas below the minimum mandated by law.

Bear in mind that I’m not even remotely a lawyer and am certainly not qualified to interpret legal rulings and laws and such. Don’t even bother to ask me how often this is enforced, or really anything about exactly how the act works, because I have absolutely no idea apart from what I can read in the text of the act itself and even then I don’t know enough to fully understand what I’m reading. But my understanding is that at least some states (like mine) set price floors for goods.

Generally, that’s used for cigarettes, though it might be for gas in some places. What it means is that there’s a law which says that a store must make at least X amount of profit on each sale. So if the store buys a pack of cigarettes for $2.00 and the law says that they have to make a 10% profit on the pack, then the lowest price they can sell the cigarettes for is $2.02. Mind you, this doesn’t mean that you’re getting the lowest price possible, since if someone else has a lower price per pack, they can charge even less. Presumably, if the sign you’re talking about refers to gas, similar rules would apply.

In Wisconsin we have a minimum markup law on gas. Similar to what Tuckerfan mentioned about cigarettes. This prevents big companies (Citgo, BP, Speedway, Kwiktrip) from taking a loss on gas for a few months to put the mom and pop places out of business.

There was also, IIRC, a controversy in some states where large grocery and or department store companies that also had gas stations were selling the gas for below cost as the result of discounts given to those who used the store. Without worrying about whether or not that’s a valid issue, it does point out that there must be an underlying state law involved setting a minimum price.

In Wisconsin it means they are blaming the high price on the state’s minimum mark up law. The funny thing is for years the gas stations bitch about it. The legislature bitches about it. Nobody shows support for it, but the legislature doesn’t change the mark up law. I think the gas retailers support the current law, and just use it a an excuse to deflect anger, while laughing about the suckers believing the story.

Umm, I would imagine that the only person profiting from the mark up law is the average consumer and small gas station owner. It screws the gas companies and the legislature (since they’d get more kickbacks from oil companies than consumers). The idea of the law is that Shell can’t just decide to sell gas in your neighborhood for $0.50 a gallon until every other gas station is out of business and then jack the price to $7.00 to make up their losses.

The law is often used by gas stations to cause other gas stations to be audited in Madison. They do this over a penny difference in the price. I know what it’s for, and I’m pointing out that the stations use it as the fall guy as does the government of this state, saying we can do nothing.

They have a way around it that makes the law a joke too. They print up a coupon good for $2 off a purchase of 10 gallons.

In NC at the SC border there was a gas station sign, “Last gas in NC, fillup now.” The price at the next and all succeeding stations in SC was 20 cents/gallon lower due to lower state gas taxes. Caveat emptor.

So how does all of this fit in with this Supreme Court decision from June?


Is that why we don’t see two corner gas stations having an all-out price war? I know that was an old practice perhaps going back to the days of Standard Oil, but today you never see it, and I;ve never understood why. Ah-ha! The SD let’s the light shine through! - Jinx

I’m reasonably certain there’s no such law in Ohio.
I seem to recall two gas stations near… Twinsburg, I think… having an all-out price battle one day. They had to have been losing money. Maybe they made it up selling $2 bags of chips…

Minor Nitpick:

If they had to make 10% profit, they would sell it for $2.20