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Old 05-10-2008, 10:06 PM   #21
Cowboy89
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Originally Posted by Reggie Dunlop View Post
Yup, and newspaper ads aren't cheap. Either are PR firms.

Building up levels of convulution pretty much is what the oil industry does for their own self-preservation. I'd appreciate it immensely if they just came clean about it (after all, they are the great champions of free enterprise).

They hold onto a commodity and god love 'em, they are maximizing it.
It's honestly how it works. It's not a cloak and dagger world of collusion. You watch too many movies.
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Old 05-10-2008, 10:08 PM   #22
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Yup, and newspaper ads aren't cheap. Neither are PR firms.

Building up levels of convulution pretty much is what the oil industry does for their own self-preservation
. I'd appreciate it immensely if they just came clean about it (after all, they are the great champions of free enterprise).

They hold onto a commodity and god love 'em, they are maximizing it. Stop crying "hard done by." It's an insult to consumer intelligence.
Building up massive amounts of ignorance is what the general public does.

Your problem and many others is assuming the oil companies is represented by the retail signs you see when you drive around. Those businesses for the most part are simply borrowing a brand, and MAKE VERY LITTLE PROFIT. Yes the large companies they represent do, but each gas station is basically a frachise owner and/or operator who squeezes out a 40 - 60 grand profit a year out of it.

The producers are a wide range of companies ... 100's of them in Alberta alone and are not 'holding on to the commodity' they are pushed around by the same market pressures that move the price of the commodity around as the end user is. They are benefiting right now that's for sure, but it's not from 'holding' the crude back from the public.
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Old 05-10-2008, 10:09 PM   #23
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It's honestly how it works. It's not a cloak and dagger world of collusion. You watch too many movies.
Somebody's making money. Gobs of it. Big stinkin' gobs of it.

I wish it were a conspiracy.
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Old 05-10-2008, 10:10 PM   #24
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It's honestly how it works. It's not a cloak and dagger world of collusion. You watch too many movies.
He watches the news too much.

It's a big problem. We have an important resource that is harder to develop, but in higher demand. The world is in deep need of understanding how the industry works, but it's too comfy to just watch CTV for 45 seconds, become an expert on their own and conclude that everyone is colluding against poor old grandma.
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Old 05-10-2008, 10:18 PM   #25
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There is no money in retail gasoline sales. There IS money in convenience sales like a coke zero or milk or a hogie, but they don't make squat at the retail level on gas.
People who manage these stations get a management salary from the oil companies.
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Old 05-10-2008, 10:19 PM   #26
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He watches the news too much.

It's a big problem. We have an important resource that is harder to develop, but in higher demand. The world is in deep need of understanding how the industry works, but it's too comfy to just watch CTV for 45 seconds, become an expert on their own and conclude that everyone is colluding against poor old grandma.
LOL!

I could care less what teh Tee Vee tells me. I've seen how petroleum runs the province I live in and I have an understanding of geopolitical issues.

The Oil Bidness is NOT in the business of benevolence. And yes, they are gouging grandma. But I guess that's grandma's fault for not buying oil stock.

Whatever. Give me the what-for for biting the hand that feeds me. Like I said, someone is profitting and profitting quite substantially so spare me the sob stories.
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Old 05-10-2008, 10:20 PM   #27
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People who manage these stations get a management salary from the oil companies.
some do, and it's within the range I said, and the price of WTI has no bearing on it.
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Old 05-10-2008, 10:22 PM   #28
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LOL!

I could care less what teh Tee Vee tells me. I've seen how petroleum runs the province I live in and I have an understanding of geopolitical issues.

The Oil Bidness is NOT in the business of benevolence. And yes, they are gouging grandma. But I guess that's grandma's fault for not buying oil stock.

Whatever. Give me the what-for for biting the hand that feeds me. Like I said, someone is profitting and profitting quite substantially so spare me the sob stories.
It's not a sob story I was helping you understand the difference between a retailer and a producer. Kinda sounds like you know everything you need to know about the oil industry though ... from your understanding of geopolitical issues.
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Old 05-10-2008, 10:23 PM   #29
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There is no money in retail gasoline sales.
Bogus. Bogus. Bogus. Bogus. Bogus. Bogus. Bogus. Bogus. Bogus.

Christ, they're on every other corner! New ones pop up in every additional subdivision!

Okay, let's say the current franchisees are chumps hanging onto a losing proposition. Where do the new ones come from then?
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Old 05-10-2008, 10:25 PM   #30
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^ India?
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Old 05-10-2008, 10:27 PM   #31
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Bogus. Bogus. Bogus. Bogus. Bogus. Bogus. Bogus. Bogus. Bogus.

Christ, they're on every other corner! New ones pop up in every additional subdivision!

Okay, let's say the current franchisees are chumps hanging onto a losing proposition. Where do the new ones come from then?


You have seen the price of crude lately right? not gasoline, crude. That is their cost.

The retailer cost is always 2-3 cents away from the sales price, which basically covers costs. They pop up all over the place, and in every neighbourhood because they act as convenience stores as well.

And nobody said they lose money ... at least I didn't. The gas allows them to operate on a corner to make money from convenience sales.
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Old 05-10-2008, 10:29 PM   #32
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It's not a sob story I was helping you understand the difference between a retailer and a producer. Kinda sounds like you know everything you need to know about the oil industry though ... from your understanding of geopolitical issues.
Yeah, that's right. Because nobody in their right mind buys into a break-even propostition, let alone continue with it.

Selling gas at the pump rightly isn't the typical ambition borne out of a personal desire to help folks get along the motorway. Face it, nothing romantic about it.

Has to be a good living in it.
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Old 05-10-2008, 10:30 PM   #33
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The gas allows them to operate on a corner to make money from convenience sales.
Then, conceivably, it would be relatively simple for a retailer to lower the cost of their gasoline below that of their competitors as a 'loss leader' drawing business to their store for their uber-profitable chips-and-slurpees trade.

However you never, ever see this. I wonder why?
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Old 05-10-2008, 10:32 PM   #34
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You have seen the price of crude lately right? not gasoline, crude. That is their cost.

The retailer cost is always 2-3 cents away from the sales price, which basically covers costs. They pop up all over the place, and in every neighbourhood because they act as convenience stores as well.

And nobody said they lose money ... at least I didn't. The gas allows them to operate on a corner to make money from convenience sales.
An awful lot of convenience stores abound too!

Why aren't they cutting their "losses" and stick to Slurpies?
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Old 05-10-2008, 10:32 PM   #35
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Yeah, that's right. Because nobody in their right mind buys into a break-even propostition, let alone continue with it.

Selling gas at the pump rightly isn't the typical ambition borne out of a personal desire to help folks get along the motorway. Face it, nothing romantic about it.

Has to be a good living in it.
The Territory managers will tell you that they go through these franchise owners like potato chips. They all have to deal with these franchise owners who leave the keys in the door and walk away.

It's clear you are not focusing on what is being said. The money that is made in the store ... the gas is a way to get people into the store.

Just for clarity, it's your geopolitical issues knowledge that allows you to understand how this industry works ... is that correct?
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Old 05-10-2008, 10:34 PM   #36
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Then, conceivably, it would be relatively simple for a retailer to lower the cost of their gasoline below that of their competitors as a 'loss leader' drawing business to their store for their uber-profitable chips-and-slurpees trade.

However you never, ever see this. I wonder why?
Of course you do. Superstore does it, Cdn Tire does it, Wal mart does it.

And it happens way more in the States, but you don't have to go far to see it here.

And btw it isn't a simple decision for say a macs to sell gas. They need to invest in the tanks you don't see underground, deal with all the safty and environment issues that come along with distributing crude products and manage a business that is very high in turnover.

Last edited by Flames in 07; 05-10-2008 at 10:36 PM.
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Old 05-10-2008, 10:34 PM   #37
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An awful lot of convenience stores abound too!

Why aren't they cutting their "losses" and stick to Slurpies?
ummm what?
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Old 05-10-2008, 10:36 PM   #38
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Yeah, that's right. Because nobody in their right mind buys into a break-even propostition, let alone continue with it.
It's my understanding that no one is buying into these locations. They are owned by Esso et all and the person managing the site is paid a salary. Any extra profit comes from the sale of pop, milk etc. I'm sure Flames in 07 will correct me if i'm wrong.

I do know someone who runs an indipendant in Douglasdale - across from the golf course. He makes little from gas sales but his bakery, deli and confections make him and his wife a tidy sum. It can be done if you have the business smarts.
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Old 05-10-2008, 10:37 PM   #39
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It's my understanding that no one is buying into these locations. They are owned by Esso et all and the person managing the site is paid a salary. Any extra profit comes from the sale of pop, milk etc. I'm sure Flames in 07 will correct me if i'm wrong.

I do know someone who runs an indipendant in Douglasdale - across from the golf course. He makes little from gas sales but his bakery, deli and confections make him and his wife a tidy sum. It can be done if you have the business smarts.
As far as I know that is the common (but not exclusive) type of relationship. Particularly in urban areas.
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Old 05-10-2008, 10:43 PM   #40
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Originally Posted by Flames in 07 View Post
The Territory managers will tell you that they go through these franchise owners like potato chips. They all have to deal with these franchise owners who leave the keys in the door and walk away.

It's clear you are not focusing on what is being said. The money that is made in the store ... the gas is a way to get people into the store.

Just for clarity, it's your geopolitical issues knowledge that allows you to understand how this industry works ... is that correct?
That would be correct.

Must be quite the spiel then to entice all these new gas retailer franchisees. What's the deal there? Surely these aren't all rubes. Takes a bit of capital to buy one of these joints.

Just so you know, I have no problem with another feller making gobs o' dough or even a comfortable living.

Everyone is getting a cut. Everyone involved gets a piece of the action. Let's not pretend otherwise.
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