[Editor's Note: This is Part 5 in an ongoing series highlighting the issues surrounding high gas prices and their effect on the industry. To comment on this series or view the previous installments, click here.]
LAKE CABLE, Ohio -- One is fighting to stay the course while the other has thrown in the towel, but in the cases of two independent, single-store gas station operators, the cost of selling gasoline is just getting to be too much.
Once gas got over $2.50 a gallon, our gallonage dropped, Jordan Rosedale, owner of the former Lake Cable CITGO in Lake Cable, Ohio, told CSP Daily News. People start carpooling; they start riding their bikes; they start riding motorcycles and mopeds. Once it got over $2.50 a gallon, it just cut our gallons in half. As a result Rosedale took the drastic measure of removing his three gas pumps and underground storage tanks in April, and he couldn't be happier.
It was the best move I ever made. My business has tripled since I pulled the pumps, he said about his store, which now does business as Lake Cable Auto Repair. I was full-service, so my gas was 5 to 8 cents higher than self-serve, and I think that maybe people thought if my gas was high, then my [auto-repair] prices were high. And that kept them from coming in. Back in the old days, we used the gas to bring the cars in, and ever since I've pulled pumps out, I've just been non-stop.
Rosedale bought the gas station in the small residential community in northeast Ohio near Canton with his wife seven years ago. At the time, he says he was selling 50,000 to 60,000 gallons of gas a month. When I pulled [out the pumps], I was doing 30,000 gallon, he said. You can't live on that with the credit-card fees and other fees.
The problem's the same for Sandeep Shankar, owner of the Zenith Conoco station in Littleton, Colo., but his solution is different. We run out of money frequently to buy gas and the pumps have to be bagged, he told CSP Daily News. So right now I have a load that's running, and when it runs out, then I'll have to come up with cash to get the next load, and there is going to be a gap [in supply].
Shankar said he typically goes about two days at a stretch without gas while he waits for the store coffers to refill. It's been happening [consistently] ever since January, he said. After Katrina, it's never been OK for us.
Interestingly, Shankar said he doesn't see a big drop in inside sales when the pumps are closed. When the gas is not there, I just cut off the power to the pumps. So, many people now understand that some days of the week we are out of gas, he said. People who want to buy something like cigarettes, they don't even approach the pump. They just come in, pick up the tobacco or whatever they want. We see a clear separation between the inside shopper and the outside shopper. Gas is no longer a driver [of inside sales].
Shankar said he would need about double his current 10-cent gasoline margin to keep fuel flowing full-time; however, he noted, that never happens because it would be a ridiculous price compared to the street [average]. Everybody around us would be lower than us.
He added that most of his competitors do not face the same issue because many of them are corporate [stores]. We are independent, and therefore, we are struggling. The corporate stores do not have a gas issue, but they're not making any money [from gas].
Shankar laughed when told about the drastic measure Rosedale took when faced with similar financial problems and said pulling out the pumps isn't an option for him. Rosedale, however, said he wished he'd done it sooner. I have no regrets whatsoever, he said. I should have done it five years ago.
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