NEWS- Slim margins: Station owners claim hardships too

Wayne Breeden laments the price hikes.
PHOTO BY MARISSA D'ORAZIO
Customer Louise Greer takes note of We Pump It owner William Hanger's old analog dials that max out at $3.99, so they have to be doubled to get the true price.
PHOTO BY HAWES SPENCER

The spike in gas prices has affected more than just drivers. Gas station owners around town report that while the highest gas price they've seen is the one displayed today– whatever day today is– it certainly doesn't translate into the highest profits they've seen. While it might be easy to assume gas station owners are striking gold in the middle of a recession, the owners say the rise in gas prices is actually hurting business and depressing profits.

"Business is definitely more challenging now," says David Sutton, president of Tiger Fuel, a company that supplies fuel to 25 local stations, including 13 of its own.

Mark Finley, owner of Finley's Service Center at Barracks Road, agrees that high prices are a problem for station owners. "We're going weeks without seeing any profit," he says.

Gas station owners have not only seen a decline in gas sales, they've also witnessed an alarming trend in customers' attitudes.

"We've seen an increase in drive-offs," said Tiger Fuel's Sutton, "and an increase in customers questioning our cashiers."

Finley has the same problems. "I think the biggest thing is a lot of people think the dealers are making more money off the gas when we're really making less," he says.

The dealers explain that cost-conscious consumers will avoid a station that tries to mark up gasoline by a few cents above the competition. Wallets of customers and station owners aren't the only things hurt by the unprecedented price run-up. 

"We've seen some people use lower grade gas when they should be using higher," says Finley, explaining that engines that need premium gas can be damaged by lower-octane fuel.

According to Finley, guessing the future price of gas is as frustrating for station owners as for customers. The price can actually increase between the time owners order it and the time it arrives at the station. "We have to wait until we buy the gas to find out how much it is," he says.

Over at We Pump It on Ivy Road, owner William Hanger has long allowed big customers to keep house accounts. Suddenly, he now finds himself carrying receivables of $90,000 a month instead of the customary $60,000.

Wayne Breeden started working at Tarleton's Oak 30 years ago, when he was 13 and gas cost about 75 cents a gallon.

"You made more money off gas then than now that it's $4," says Breeden. "Credit cards were seldom looked at or used."

Now credit cards are ubiquitous at gas stations, and Breeden's station pays a 3 percent fee on every credit card transaction.

Breeden's volume of gas sales has gone down significantly– from an average of 1,000 gallons a day to 800-900 gallons, he reports. But no matter how high prices spike, he says, people will continue to buy gas. "Unless they want to walk or get a horse, they'll pay whatever," he notes wryly, adding that although people will continue to drive, families with thee or four cars may try to cut back to one or two.

Finally, desperate people can jeopardize their personal safety. Police report that people drilling into gas tanks to steal gas expose themselves to explosions or fires or worse. Breeden hasn't experienced any such activity or even any incivility at Tarleton's Oak. He says it's because customers seem already to understand that gas station owners aren't the ones making the profits. "If we were," he says, "we'd all be living in houses on a hill."

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