Local News

Gas station owners not pumped about higher prices

Posted June 2, 2008

— Record gas prices might mean record profits for oil companies, but gas station owners said those profits don't trickle down to the neighborhood pumps.

Credit card processing fees are eating into the thin profit margins at smaller stations, owners said, adding that they're losing money on every gallon they sell.

"You lose money anytime people use a credit card to pay for gas," station owner Steve Byers said. "People would be really shocked if they put $125 worth of gas in their SUVs on a credit card, when in fact we've lost money."

Credit card companies charge merchant fees in the form of a percentage of sales. Byers and other owners said the fees were more manageable when gasoline was around $2 or $2.50 a gallon, but the fees have soared along with gas prices in recent months.

Nationally, the average price for a gallon of regular gas on Monday was just under $3.98. In the Triangle, the average was about $3.92 a gallon.

According to a recent study, nearly two of every three U.S. drivers use credit cards at the gas pump. In addition to convenience, many pumps are programmed to require payment in advance to discourage theft.

That leaves station owners with two choices: Raise prices and risk losing customers, or keep them as low as possible and lose money.

"It's a balancing act, and you've always got someone across the street that you've got to compete with," said Gary Harris, executive director of the North Carolina Petroleum Marketers Association.

Because of fees, credit card companies made almost twice as much money off gas sales last year than retailers, Harris said.

"What you're going to see is a lot more discount (prices) for cash," he said. "It's cheaper for (station owners) for you to buy with cash than with a credit card."

Byers said he relies on sales inside his convenience store to stay afloat.

"I appreciate you coming in and paying cash. I can actually make 50 cents," he said.


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  • Pilot2B Jun 3, 2008

    Although the savings might have me think about paying cash, there is one thing you need to consider...your time. How much is standing in line 1 to 2 times worth to you (to save $1.00 - $2.00)?

    For me, my time is worth more than that (pay at the pump and head back out in the road), not have to stand in line and *wait* 2 times (1 to pay, then a 2nd to get change)

    That is why I love pay at the pump...Of course maybe I need to slow down my pace on life then :-)

  • grayboomerang Jun 3, 2008

    Okay, I got to admit..when I swipe my card at the gas station and it says.."CREDIT OR DEBIT"...I hit Credit because I'm already so angry about the entire situation. I've been saying for months that the stations should offer a discount to those who pay in cash....I'd do it in a heartbeat.

  • Imagine 722 Jun 3, 2008

    All I have to state is the obvious: GAS PRICES SUCK!!!!!!!!!!!! We ARE in the top #10 highest gas prices in the country :(

  • Cleanup on Aisle Cool Jun 3, 2008

    Wahhh - cry me a freakin river.
    Offer a discount to people who come in and pay cash(close to whatever % the credit card companies charge). PROBLEM SOLVED!!! WIN-WIN - customer pays less, and the gas station doesnt pay a bunch of fees.

    And while you're at it, would it kill you to make some decent coffee? Anyone that's been to a "Wawa's" knows it is possible to have a decent cup of coffee at a gas station.

  • winemaker81 Jun 3, 2008

    "Maybe if all the libs would consider drilling on our own soil Alaska, Florida, Texas, The Dakotas, we wouldn't have such high gas prices."

    I read an article last year that said *50%* of our oil is domestic, 30% from Canada, and the remaining 20% from else where. Unfortunately I didn't save the article nor do I know how accurate it was. I'll see if I can find it or a similar one again.

  • OLD PIRATE 2 Jun 3, 2008

    wxyz: the oil companies are making the extra off the use of the debit card. As for the oil manopoly in the US, wrong: Most of the oil companies in the US are really European in nature. And believe it or not they can pick up and leave in 6 months. Everything they do and most of their employees are contracted. Not a good situation.

  • OLD PIRATE 2 Jun 3, 2008

    I've been in c-store business for 30 years.This is the first honest articles I've seen from WRAL...I've written for years and rarely see anything positive about the retailer. Oil companies tell us which cards to accept, must use their platform to accept the cards, and their network. The oil companies are making a profit off the missery of their own retailers. New congressional act "fair cc act" will not help because it only says they can shop around for the best price but the retailer can't.

  • Just Once Jun 3, 2008

    Detroit is not as strong as it used to be

  • NeverSurrender Jun 3, 2008

    "You can thank Mr. Ted Kennedy and the rest of the followers for the price of gas. Let's use our own resources people instead of making our enemies RICHER!!!!!!!!!!!!!"


    And just maybe if our "leaders" got off their duffs and invested in ways to get this country off of oil, we could actually sell oil to the world and have them make us richer rather than the other way round.

    Of course, we'd have to get round two powerful lobbies...Detroit and Big Oil...to do it.

    Good luck when they've got the money and the politicians in their back pocket.

  • Just Once Jun 3, 2008

    I have an idea! Raise the price on tobacco products enough to cover the loss on the gas!!