Groceries and Gas

Arizona, Hawaii, Nevada, New Mexico, Oklahoma, and Texas. No non-grocery posts.
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jamcool
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Groceries and Gas

Post by jamcool »

Our local fishwrap had an article on how grocers and mass retailers are becoming the major retailers of gas in Phoenix....

http://www.azcentral.com/business/artic ... omers.html

What is surprising that Fry's is #4 in statewide gas sales...and the only "major" oil company in the list is Valero/Diamond Shamrock. The oil-company-owned station seems to be going away.
tesg
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Re: Groceries and Gas

Post by tesg »

Yeah, we hardly have any oil company-branded gas stations in town anymore...a few BP's.

The major players are dedicated convenience chains Kum & Go and Casey's (both who are based here) and QuikTrip. And even dedicated convenience chains are starting to show signs of moving away from gas. I saw two new 7-Elevens in the Salt Lake City area last winter...one in a strip mall, one a ground-up standalone build...with no gas pumps.

Supermarket-wise here, Hy-Vee is very much in the gas business around the metro with their "Hy-Vee Gas" outlets (the vast majority of which are on the frontage of Hy-Vee properties, but there are exceptions...there's one in Davenport nearly a mile from the nearest Hy-Vee), and Dahl's has put up pumps at a couple of stores. But both Hy-Vee and Dahl's are also putting in full convenience stores with theirs, more like a Meijer setup than the little mini-island structure Safeway does.

Hy-Vee locally just got build permits to put up a Hy-Vee Gas on a lot they eventually plan to put a supermarket on long before the actual supermarket opens. They plan to have the convenience store open this spring, with the 85,000 square-foot market to follow late this year or early next year.
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Re: Groceries and Gas

Post by wnetmacman »

Retailers (including grocery stores and mass merchandisers) use gas sales as a way of driving up store sales. Kroger and others use their rewards cards to either give away or (where gas giveaways aren't allowed) significantly reduce the price of gas. Most companies refer to these gas stations as loss leaders. Lose a little money on gas, then they'll buy the stuff in the store. Walmart with Mirastar and Murphy have gas stations in the lots where if you use the WM gift or credit cards, you get a 3 cent per gallon discount. Winn Dixie has their rewards program where you get multiple per gallon discounts (up to the entire purchase, if you buy enough there). Others have similar programs.
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Re: Groceries and Gas

Post by Alpha8472 »

The gas stations are profitable. They make less profit per gallon than more expensive gas stations nearby, but they do make a profit. There are gas stations such as ARCO in Northern California that compete with Safeway gas stations. ARCO gas is often a little cheaper than Safeway gas and those ARCO stations still stay in business.

The gas discounts are small change to a supermarket chain, and these grocery store gas stations often have long lines. I would not call the gas stations loss leaders as the gas stations will definitely make some profit.

With gas prices as high as they are now, people are seeking out the lowest priced gas. Even if people are in a hurry and don't have time to shop at a grocery store to get a gas discount, they still get gas at the supermarket gas station because it is still the cheapest.
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