What Happens When the Prices Change?

Gas prices rise and fall due to many different factors. There may be an excess of oil available or it may just be a certain time of the year when prices are always high or low. During the colder months like December and January prices are generally much less than warmer months like June and July. Depending on what part of the country your store resides in can also play a part in fuel costs. Gas prices are usually highest on the West Coast while prices are the most stable in the Rockies and least expensive in the South and Southeast.

• When prices go up:
  • Customers tend to pick another store with lower prices even if it is only be one cent
  • If all stores in the area go up a the same time many people will find alternative ways to commute like riding a bike or carpooling
  • Others will cut back on driving altogether and put less amounts in their tank like five or ten dollars
  • People are also less likely to spend money inside c-stores on snacks, drinks, and other items
• When prices go down:
  •  Three in five drivers become more optimistic about the economy
  •  24 percent of customers say that they will drive more and 18 percent say they will spend more
  • Drivers are also more likely to come inside c-stores and buy their favorite items

What to Do When Fuel Prices Increase

Be honest and open with your customers about why the price has changed.

Explaining to your customers about why your prices have risen will make them feel like you an honest retailer. This along with thanking them for their continued loyalty will strengthen your customer relationships ensuring they shop with you in the future.

Offer an incentive that will make it worth it for the customer to fill-up.

Having another lower priced item for any fuel buyers is a great strategy to keep customers coming in even when the prices rise. Having a free or discount coffee for morning commuters or a bottle of water for those coming in the afternoon. You can even add more value to your fuel by giving away services like a free car wash (if your c-store is compatible) or future discounts and coupons on other items in the store.

Explain how the higher prices gives them the options they love.

If customers do not understand why the prices are going up even after explaining to them, try letting them know that without the price increase you would not be able to offer all of the products and services that you have. The customer may not have their favorite energy drink or Kombucha if you did not have higher prices. The increase allows you to give the shoppers more choices that others in the area may not have.

Focus on selling food items.

Edible grocery items have higher margins than gasoline or cigarettes according to the NACS. This means that even when prices are high you should be gaining the majority of profits from inside of your c-store. Focus on marketing these products and lure customers in that way.

Tell them how the increase in price is not to increase profits.

By explaining the necessity of raising your prices it shows the customers that you are not being greedy, but instead you are doing what you must to offer the best services and selection. Let them know that you are a small business and you are only trying to improve your c-store and are not like large chains that are trying to make more profits. They will most likely appreciate your honesty and continue to support your business.

Taking Advantage of Low Fuel Costs

When people feel like they are saving money they are more friendly. Take advantage of this opportunity by growing your customer relationships and loyalty. You can do this by excelling in other areas like offering healthy choices and placing an increased emphasis on fresh prepared food choices like 7-Eleven and Quik Trip has done at many of their remodeled locations. You can also use this time to better understand your shoppers various paths and the best selling item categories so you can better market during times of high gas prices.

Also, when gas prices are low it affects the entire economy making many things cheaper, especially traveling. You may think more road trips, but in addition to this many airlines have lower prices when fuel prices are down. This means if you are in a popular location for travelers, then you should be stocking up on the items and improving the services they use the most. Clean bathrooms and staple snacks will be you ally when more travelers are in your c-store.

With the rise and fall of gas prices we always see changes in customer behavior and shopping patterns. Learning to manipulate these behaviors will benefit you in the long run. Taking the time to talk to your customers and figure out what will keep them coming in when prices are high will help you stay consistent throughout the year, no matter what the temperature is outside.

Plenty of Opportunity

Most consumers choose gas stations based on location.  This means the majority of fuel consumers are visiting a station that is near their home, job, school, or other destination.  Typically consumers will frequent the same gas stations on a regular basis.  Once a consumer has pulled in to pump their gas, c-store owners have to take advantage of what is considered a “captive audience”.

There are a number of signage locations that are available to use for catching a consumers eye and when used properly, could make all the difference in boosting a gas station’s c-store profits:

• Above the pump
• On the pump
• On posts/poles
• On the ground out of driving/parking area
• On store windows/outside walls

Finding a Balance

While there are so many opportunities for signage that could attract the fuel consumer to the c-store, store owners must be wise in their utilization.  Too many visual cues or unattractive advertising will only overwhelm consumers and keep them from coming in to make more purchases.  The key to ideal gas pump signage is to only promote one or a very select few items at a time while making sure that messaging is strong and consistent.  Promoting a few items at a time is fine, as long as the items you think will sell the best are in the most noticeable advertising spaces.  Make sure that signage isn’t clashing and remains easily visible.

Keeping it Fresh

Again, pump advertising that is outdated or simply looks ratty is much less likely to grab a fuel consumer’s attention.  Also, repeat customers will start to ignore advertising that is the same for too long.  Whether you’re using yard signs or pump toppers, make sure you regularly refresh your signage and keep your forecourt looking bright and clean.

Keeping it Bright

If you’re going to invest your time and money in gas pump and forecourt signage, you want to ensure that it can be seen at all times of the day and night.  Keep your forecourt well lit, paying special attention to the areas where signage is placed to draw in consumers.

Knowing Your Consumers

As with any signage or store decision, store owners should make sure that their gas pump signage makes sense for their specific customers.  For example, if you know that consumers in your area love a specific kind of snack, you will likely want to promote that snack at the pump frequently to remind them that your c-store has it.  Also, as you are refreshing your pump signage over time, keep in mind what signage has helped or failed in the past so that you are not wasting time, effort, or most importantly signage space.

Embracing Technology

Today, gas retailers like BP are accepting the results of “pay-at-the-pump” technology and engaging fuel consumers at the pump even more.  Innovations like digital signage that allow commercials, news, weather, music videos and more are giving consumers more reasons to enjoy their trip to the gas station.  While these new pump additions can be pricey, they can also offer opportunities that traditional signage simply can’t:

• Gathering loyalty information at the pump
• Product advertisements that have a better chance at gaining consumer attention
• An attractive advertising opportunity for local businesses/organizations, which could mean revenue for store owners

While this new digital pump signage is still new, it is certainly the way of the future and sure to continue becoming the norm.

The more consumers turn toward delivery and ecommerce, the less they will want to buy items inside brick-and-mortar stores.  By creating a gas pump and forecourt experience that keeps consumers engaged and happy, you can keep the coming into your store for food and beverages they might not have originally stopped for.  Once you’ve found the gas pump signage strategy that keeps in-store foot traffic steady, keep optimizing it over time to boost your sales.

How is E15 Different?

E15 is a fuel that is made up of 15 percent ethanol and 85 percent gasoline. Having ethanol added to gasoline is shown to reduce emissions and helps to keep your engine cleaner. This is partially due to its higher octane rating, which measures the performance of an engine fuel. The higher the octane number is the more the fuel can withstand. E15 is also different because it has been tested in multiple different vehicles driving over 6 million combined miles and “can be used in nearly all existing fuel infrastructures without risk of damage“. Making it a great option for c-store owners to sell at the pump. It is also available in twenty-eight states in varying c-stores.

What Kind of Vehicles Use E15?

In 2012, the blended ethanol fuel was approved for vehicles that are the model year 2001 and newer by the U.S. Environmental Protection Agency. This group includes more than 80 percent of the cars, trucks, and SUVs on the road today, which means that many of your customer’s vehicles are most likely compatible with E15 fuel. Chrysler, General Motors, and Ford have also approved E15 for all of their 2017 models.

Why Should I Offer an Alternative Fuel?

E15 will save you money.

Since E15 is much cheaper than any other fuel, especially unleaded gas choosing to sell this fuel alternative should be an easy choice for c-store owners.

Set the prices in your area for maximum profits. 

Many c-stores have not yet implemented E15. This means that there is a huge opportunity to make profits if you are the only seller in your area. By offering something that your competitors do not have you will be able to control the prices making your business more money.

Bring in customers with lower prices fuel signs. 

Since E15 costs less to buy, you will be able to offer lower prices. This will bring in more customers at the pumps and inside of your c-store.

Attract new customers with a fuel option your competitors do not have.

Today, fuel volumes are up at every c-store in both single stores and large chains that are offering E15. More fuel sales mean more customers will be coming into your c-store to buy additional products.

Be environmentally and economically conscious. 

Ethanol is considered to be much better for the environment than traditional gasoline since it produces lower carbon monoxide and dioxide emissions. You could also help the economy by offering E15 since more than 136,000 green-collar jobs could be created nationwide as more retailers switch to fuel alternatives. Ethanol fuels are also created domestically, so our dependence on foreign oil would decrease.

Who Is Already Selling It?

Throughout the country, many c-store chains have started implementing E15 fuel in select locations. Here are a few of the companies currently offering E15:

• Sheetz
• Kum & Go
• Murphy USA
• MAPCO Express
• Protec Fuel
• Minnoco
• RaceTrac
• QuikTrip
• Thornton’s
• Hy-Vee

Where Do I Start?

In order to be able to offer E15 to your customers, you must have the right equipment and meet all of the required regulations. The RFA has a great guide that explains exactly what you need to do to get your pumps ready. It may seem costly to get your fueling stations ready to sell E15 fuel, but you will most likely make back these costs quickly. E15 is very promising and you will be able to see major profits soon after offering the alternative fuel to your customers.

As vehicles evolve and the need for alternative fuel increases, it is important for c-stores owners to start implementing new fueling options. Considering a 15 percent ethanol fuel is a profitable move since many c-stores have yet to switch. Be the first in your area and enjoy the boost in overall sales as customers choose your c-store over the competition.

The History of the Electric Car

It may be a surprise to many people that the invention of the electric car actually dates back more than a hundred years ago. However, there were no real R&D advancements until the 1970s, when the vehicle finally started to increase in popularity. This is mainly due to gas shortages that caused prices to sky rocket around 1973 with the Arab Oil Embargo. Since then, as we learn more about the impact of oil products on the environment, and seek greener and more affordable sources of fuel, automakers have continued making advancements, creating the modern EV that we have today.

Hybrids and Total Electric

Many popular brands of cars have converted their most popular models into hybrid or electric alternatives. Ford, Hyundai, Honda, Chevrolet, Kia, Nissan, and even BMW have all jumped on board. Here are some of the EVs that have shaped the alternative fuel game.

Toyota Prius; released in Japan in 1997, this is the world’s first mass produced hybrid electric vehicle. A hybrid does not have the ability to plug in, but instead has an “electric drive system and battery” meaning that the battery continually recharges with energy from the engine and the brakes. After the Prius was released in 2000,  many environmentally conscious celebrities supported the car, making it the best-selling hybrid in world.

Ford Fusion; now on its second generation, this model has been released as a gasoline-electric hybrid, and in 2013 was released with a plug-in version.

Nissan Leaf;  this is an electric vehicle that uses its plug-in feature to drive and to use the battery. The compact five-door hatchback was first introduced in Japan and then in the US in late 2010. This car won World Car of the Year in 2011.

Chevrolet Bolt; One of the newest EVs, this car has already won the 2017 North American Car of the Year. Offering more advanced technologies, Chevrolet has claimed that they have completely reinvented what an electric vehicle can be.

Although there have been many advancements, most drivers still prefer gas powered vehicles. While EV are slowly gaining popularity, they are not heavily impacting the gas-fueled market just yet.

Experts Estimate on EV

The Bloomberg New Energy Finance Company believes that by 2040, 35 percent of all new vehicle purchases will be EV. Of course, this means that 65 percent of new automobiles bought will still be gas powered. Thus, gas stations will still be a necessity for transportation.

“Bloomberg provides independent analysis and insight, enabling decision-makers to navigate change in an evolving energy economy.”

The Truth About Hybrid and Electric Cars

The idea of an electric car seems great to many people, but automakers and customers run into a variety of challenges.

EVs are expensive to produce, making them more expensive to buy. 

The transition to electric vehicles will be slowed by cost as automakers struggle to make a profit. Electric cars are pricey, and while the reduction in gasoline needs is enticing, the cost is still a deal breaker for many car buyers. The starting price for  most EVs is around $20,000, and it only goes up from there.

EVs are not suited for road-trips or families that live in rural areas.

Advancements are being made, but charging stations are few and far between in suburban areas, and almost nonexistent in rural areas. Many families that do not live in larger cities may have to drive long distances in order to get to any retail, food, or other entertainment. Since EVs have a low mileage range, they can be an impractical choice for these consumers. If you do live in a city, having to plan out entire road-trips based on where you can stop and charge up your car is a major, inconvenient consideration. Many customers have made the decision to stick with the safety of having a gas powered vehicle that can fuel up at any of the thousands of c-stores across the country.

Charging takes time that some people may not have.

With some models such as the Nissan Leaf, it can take up to 20 hours on a 120 volt outlet, 7 hours on a 240 volt, and 30 minutes for a 480 volt. The higher the voltage the more expensive the charger, costing easily over a thousand dollars. For electric cars, time really is money.

Looking Into the Future

Many c-stores’ main profits come from gasoline sales. This makes EV a huge concern for those wondering what the future will hold for transportation. The good news is, the convenience industry can count on a gasoline focus for at least the next twenty years. While there’s no need to worry about gas sales, c-store owners may consider adding charging stations alongside their gas pumps in the future. Implementing new services will always help boost profits.

Although advancements are being made and popularity is increasing for EVs, customers are still staying true to fuel. Continue making your store the community hub by offering better customer service and new amenities that will increase sales and prepare your business for the future.