PHOENIX -- Retailers reviewing newly released industry statistics at the Convenience Retailing Conference in Phoenix on Tuesday noted a 20% fall in pre-tax profits for the 10-month period ending October 2006 vs. the same period 2005all due to Hurricane Katrina.
The Katrina Effect, which created a supply-chain glitch that sent gasoline margins soaring in the fall of 2005, made 2006 comparisons difficult since retailers were not likely to see the same margin results a year later, according to Dick Meyer, partner with CSX LLC, Columbia, Mo., a c-store specific [image-nocss] research firm that presented statistical data at the annual retailers' conference.
Last April, I thought there would be a 20-25% decline. With Katrina and Rita, there was so much fuel volatility, I wondered how could we repeat that?, Meyer told the group of about 500 retailers and suppliers in attendance. But it's still a healthy environment.
Meyer noted that pooled cents-per-gallon margin by month showed a strong showing for September 2006, after supply questions subsided and wholesale prices fell faster than street postings. October 2006 margins then reverted back to 2004 levels, leaving a spike from 2005 for the industry to reflect upon.
Other key comparisons included:
In-store sales up 5.3%, with per store, per month sales being $114,000 for the first 10 months of 2006 vs. $108,200 for the same period a year before. In-store gross-profit dollars up 4.6% to $34,000 for that same time period in 2006 vs. $32,500 in 2005. Average selling price per gallon in cents per gallon rose 16.3% to $2.57 from $2.21 the year before. Credit card fees for the 10-month time period rose 22.7% to $4,500 per store, per month vs. $3,700 the year beforea number that surpassed pre-tax profit per store, Meyer noted.Also on the panel was Tim Tilford, vice president of marketing for Martin & Bayley, Carmi, Ill., the 110-store Huck's Food & Fuel chain in the southern part of the state. Tilford explained to the audience what he found relevant in the numbers, comparing his statistics to CSX's national numbers.
Tilford had noted how his company undertook a labor and training effort in the last year, resulting in his inside sales per labor hour statistics to be higher than CSX's national averages. Similarly with inside sales per labor dollar, Tilford's chain excelled. In both areas, the chain lagged behind national numbers the year before implementing its labor program.
The numbers also pinpointed areas of improvement, said Tilford, noting inside-sales increases of 4.3% at his chain and 5.4% nationally. You can be satisfied with 4.3%, he said, But not when you know everyone else is at 5.4%
CSX compiled its latest set of statistics based on numbers from 81 firms representing 4,012 stores as of February 6, 2007.
Moderating the afternoon panel was Paul Reuter, president and editorial director for CSP Information Group, Oak Brook, Ill.
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