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I see it mostly at smaller gas stations these days and it usually looks like "Regular" and "Paying with Cash" price. Frankly I wish more places would offer a c
by rubyfan 10y ago
I see it mostly at smaller gas stations these days and it usually looks like "Regular" and "Paying with Cash" price.
Frankly I wish more places would offer a cash discount. The rewards program schemes have always bothered me.
- athenot 10y agoSome (most?) gas stations make more money on the convenience store than on the gas itself. So setting up a scheme to encourage the customer to come in the store is in their interest. They make it super easy to toss in a side item with the gas purchase.
- rubyfan 10y agoGood context. Lottery tickets, tobacco products, monster energy drinks, coffee, soda, 5 hour energy, protein bars and beef jerky are evidently where the money is made.
- ams6110 10y agoThis is true. Gasoline is sold with almost no profit. It's one example of a perfect competitive market converging on zero profit (at least for the retailer). Gasoline is a commodity, it's all the same and everwhere it's sold there are usually several competing retailers and prices are highly visible from the street.
- rubyfan 10y agoYeah interesting, I wonder if there's anything remotely similar in the real world.
- analog31 10y agoI suspect it's quite common. Gas is an ideal loss leader -- the price on the sign, and your need for gas, gets you into the station. But now you're there, and you're less sensitive to the price of a Coke or bag of jerky. But there are a lot of markets where price competition drives down the margins for the "main" product, so that the retailers make up their profits on smaller stuff. I've read that a store selling electric guitars or bicycles makes relatively little profit on those items, but instead, makes their nut on accessories, things that wear out, service, lessons, etc.
- Broken_Hippo 10y agoIt was the same in Indiana. Most commonly gas stations charged two prices, one for regular and one for a cash discount. The reasoning was that they weren't making enough profit from fuel to cover the cost of the credit transactions with the price of gas as it was. The cards had different tiers for the fees, and when gas went up, more common people went over into the 2nd or 3rd tier. Additionally, some small restaurants and shops did the same thing. Usually these folks get charged more for processing credit cards than the large places.