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Petrol stations operating on "razor thin margins" 09:13 - Jun 30 with 1133 viewsSouperJim

According to the Petrol Retailers Association, so decided to do a little bit of digging while drinking my coffee this morning.

The PRA say it costs up to £25,000 per month to run a petrol station. Profit margins are currently around 11p per litre for petrol and 8p for diesel. My fairly basic maths tells me they need to sell 250k litres of fuel per month to break even. So about 5k tanks of fuel for your average car. Obviousy I'm doing very rough figures here. So about 170 cars per day need to come and buy a full tank.

Clearly they make much much bigger margins on everything else like sandwiches and bottles of water, but still, it seems pretty daft that so little of the money made from petrol production is actually passed onto those who ultimately sell the finished product.
[Post edited 30 Jun 9:52]

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Petrol stations operating on "razor thin margins" on 09:19 - Jun 30 with 1071 viewsLord_Lucan

That’s actually a higher margin than I was led to believe.

I thought they were on about 3p per litre.

They are a bit like garden centres though, inasmuch that garden centres make little on plants.

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Petrol stations operating on "razor thin margins" on 09:19 - Jun 30 with 1072 viewsScotBlue

Not so sure I totally believe the retailers in this. We have a local garage that sells diesel primarily to lorries so in high volumes that is consistentley 5 - 10p / litre cheaper than the local Asda that is just 1 mile away. Both are self serve so don't need operators to take payments and at the lorry stop you get a free cup of coffee for filling up. If retailers were on such thin margins not sure how this garage could sell their diesel. I appreciate that filling a lorry will be more litres and therefore they probably have a high turnover of fuel but would expect this to be the same for the local Asda that often has a que outside.
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Petrol stations operating on "razor thin margins" on 09:25 - Jun 30 with 1048 viewsEdwardStone

Petrol stations operating on "razor thin margins" on 09:19 - Jun 30 by ScotBlue

Not so sure I totally believe the retailers in this. We have a local garage that sells diesel primarily to lorries so in high volumes that is consistentley 5 - 10p / litre cheaper than the local Asda that is just 1 mile away. Both are self serve so don't need operators to take payments and at the lorry stop you get a free cup of coffee for filling up. If retailers were on such thin margins not sure how this garage could sell their diesel. I appreciate that filling a lorry will be more litres and therefore they probably have a high turnover of fuel but would expect this to be the same for the local Asda that often has a que outside.


My first job out of school was a petrol pump attendent .... we were the cheapest petrol station for miles, so it was always very busy

The boss man told me that the price we paid for the fuel was tied to the volume we sold, that if we didn't hit a certain level of sales then the cost to us rocketed.

I suspect it is still the same nowadays
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Petrol stations operating on "razor thin margins" on 09:41 - Jun 30 with 993 viewsSouperJim

Petrol stations operating on "razor thin margins" on 09:19 - Jun 30 by ScotBlue

Not so sure I totally believe the retailers in this. We have a local garage that sells diesel primarily to lorries so in high volumes that is consistentley 5 - 10p / litre cheaper than the local Asda that is just 1 mile away. Both are self serve so don't need operators to take payments and at the lorry stop you get a free cup of coffee for filling up. If retailers were on such thin margins not sure how this garage could sell their diesel. I appreciate that filling a lorry will be more litres and therefore they probably have a high turnover of fuel but would expect this to be the same for the local Asda that often has a que outside.


I've read that supermarkets are happy to break even on fuel at best, as it's just a vehicle to try and get customers through the door.

Meanwhile the government currently take 52.95p per litre, then 20% vat on the entire sale (including the duty). Given that the more expensive a tank is, the more they're making on vat, with fuel prices so high the 5p cut on duty really isn't very much of an offering.

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Petrol stations operating on "razor thin margins" on 09:43 - Jun 30 with 977 viewsSouperJim

Petrol stations operating on "razor thin margins" on 09:25 - Jun 30 by EdwardStone

My first job out of school was a petrol pump attendent .... we were the cheapest petrol station for miles, so it was always very busy

The boss man told me that the price we paid for the fuel was tied to the volume we sold, that if we didn't hit a certain level of sales then the cost to us rocketed.

I suspect it is still the same nowadays


That's interesting, I wonder if it's quite the same for the big chains and supermarkets? Particularly the likes of shell/bp who presumably supply their own fuel to their franchises.

In the last couple of days (in west suffolk and cambridgeshire at least) the price of fuel at the supermarket has actually been higher than at shell and bp. No idea what is going on there.
[Post edited 30 Jun 9:44]

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Petrol stations operating on "razor thin margins" on 09:45 - Jun 30 with 948 viewshomer_123

Petrol stations operating on "razor thin margins" on 09:43 - Jun 30 by SouperJim

That's interesting, I wonder if it's quite the same for the big chains and supermarkets? Particularly the likes of shell/bp who presumably supply their own fuel to their franchises.

In the last couple of days (in west suffolk and cambridgeshire at least) the price of fuel at the supermarket has actually been higher than at shell and bp. No idea what is going on there.
[Post edited 30 Jun 9:44]


For Supermarkets, fuel is a loss leader.

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Petrol stations operating on "razor thin margins" on 09:46 - Jun 30 with 939 viewsITFC_Forever

That's been the way for years - petrol stations make next to nothing on fuel.

Cigarettes are another one - retailers make very little on them too.

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Petrol stations operating on "razor thin margins" on 09:46 - Jun 30 with 929 viewsLord_Lucan

Petrol stations operating on "razor thin margins" on 09:41 - Jun 30 by SouperJim

I've read that supermarkets are happy to break even on fuel at best, as it's just a vehicle to try and get customers through the door.

Meanwhile the government currently take 52.95p per litre, then 20% vat on the entire sale (including the duty). Given that the more expensive a tank is, the more they're making on vat, with fuel prices so high the 5p cut on duty really isn't very much of an offering.


I read a very interesting article from a fuel person the other day but I can't find the blooming thing.

The article may not have been correct and I might have misremembered it - but here we go

Forecourts earn 3.3p per litre and the retail price is governed by the wholesaler and they have to stick with it.

Supermarket stations have been bought out and prices are no longer in their control.

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Petrol stations operating on "razor thin margins" on 09:47 - Jun 30 with 921 viewsGuthrum

The further down any supply chain you go, the narrower the margins - simply because those upstream have already taken their cut, leaving less room between the purchase cost and what the customer is prepared to pay.

Which is why it goes from costing between £5 and £30 to get a 160 litre barrel of crude oil out of the ground via shippers, refiners, more shippers and garages to nearly £2 per litre at the pump.

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Petrol stations operating on "razor thin margins" on 09:48 - Jun 30 with 905 viewsGuthrum

Petrol stations operating on "razor thin margins" on 09:46 - Jun 30 by ITFC_Forever

That's been the way for years - petrol stations make next to nothing on fuel.

Cigarettes are another one - retailers make very little on them too.


Same with pubs and beer. You either have to sell a lot, or do food.

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Petrol stations operating on "razor thin margins" on 09:50 - Jun 30 with 891 viewsSouperJim

Petrol stations operating on "razor thin margins" on 09:46 - Jun 30 by Lord_Lucan

I read a very interesting article from a fuel person the other day but I can't find the blooming thing.

The article may not have been correct and I might have misremembered it - but here we go

Forecourts earn 3.3p per litre and the retail price is governed by the wholesaler and they have to stick with it.

Supermarket stations have been bought out and prices are no longer in their control.


That last bit is very interesting if accurate, would make little sense for supermarket stations to be a loss leader if they're not even owned by the supermarket?

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Petrol stations operating on "razor thin margins" on 09:51 - Jun 30 with 881 viewshomer_123

Petrol stations operating on "razor thin margins" on 09:48 - Jun 30 by Guthrum

Same with pubs and beer. You either have to sell a lot, or do food.


Only if you tied in with the brewery.

Friend of mine runs a social club - he'll tell you that you can save a lot on beer if you are not tied in. Also, typically, he buys all their spirits from Tesco's as often cheaper than the brewery or anywhere else!
[Post edited 30 Jun 9:59]

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Petrol stations operating on "razor thin margins" on 09:54 - Jun 30 with 826 viewsSouperJim

Petrol stations operating on "razor thin margins" on 09:51 - Jun 30 by homer_123

Only if you tied in with the brewery.

Friend of mine runs a social club - he'll tell you that you can save a lot on beer if you are not tied in. Also, typically, he buys all their spirits from Tesco's as often cheaper than the brewery or anywhere else!
[Post edited 30 Jun 9:59]


Surely bookers/costco has to be cheaper than tescos?

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Petrol stations operating on "razor thin margins" on 09:56 - Jun 30 with 788 viewshomer_123

Petrol stations operating on "razor thin margins" on 09:54 - Jun 30 by SouperJim

Surely bookers/costco has to be cheaper than tescos?


You'd think, right? He tells me not, Tesco's usually have deals on spirits that he says means it even beats the likes of Bookers and Cost Co.

Due to the amount of beer he sells - he gets really good rates on standard beers and premium as well. Not being tied into a brewer means he can scout for the best price and he gets it due to volume.

Also, it's the cheapest place to drink locally by a long long way.

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Petrol stations operating on "razor thin margins" on 10:03 - Jun 30 with 757 viewsITFC_Forever

Petrol stations operating on "razor thin margins" on 09:48 - Jun 30 by Guthrum

Same with pubs and beer. You either have to sell a lot, or do food.


Yes, absolutley.... pubs make very little on beer, food is where the money's at.

Although Post Mix on soft drinks is an enormous margin for pubs

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Petrol stations operating on "razor thin margins" on 10:03 - Jun 30 with 751 viewsLord_Lucan

Petrol stations operating on "razor thin margins" on 09:54 - Jun 30 by SouperJim

Surely bookers/costco has to be cheaper than tescos?


Supermarkets are usually a lot cheaper that Bookers etc on alcohol - and in fact many other things

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Petrol stations operating on "razor thin margins" on 10:07 - Jun 30 with 729 viewsEwan_Oozami

Petrol stations operating on "razor thin margins" on 09:56 - Jun 30 by homer_123

You'd think, right? He tells me not, Tesco's usually have deals on spirits that he says means it even beats the likes of Bookers and Cost Co.

Due to the amount of beer he sells - he gets really good rates on standard beers and premium as well. Not being tied into a brewer means he can scout for the best price and he gets it due to volume.

Also, it's the cheapest place to drink locally by a long long way.


Is that a sales pitch? Are you on commission? :-)

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Petrol stations operating on "razor thin margins" on 10:08 - Jun 30 with 721 viewshomer_123

Petrol stations operating on "razor thin margins" on 10:07 - Jun 30 by Ewan_Oozami

Is that a sales pitch? Are you on commission? :-)


Ha! I wish...

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Petrol stations operating on "razor thin margins" on 11:34 - Jun 30 with 538 viewsCBBlue

Petrol stations operating on "razor thin margins" on 10:03 - Jun 30 by ITFC_Forever

Yes, absolutley.... pubs make very little on beer, food is where the money's at.

Although Post Mix on soft drinks is an enormous margin for pubs


Pint of Shandy cost more than a pint of beer when a group of us popped to the pub at lunchtime the other day.

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Petrol stations operating on "razor thin margins" on 13:29 - Jun 30 with 406 viewsDeano69

Petrol stations operating on "razor thin margins" on 09:19 - Jun 30 by ScotBlue

Not so sure I totally believe the retailers in this. We have a local garage that sells diesel primarily to lorries so in high volumes that is consistentley 5 - 10p / litre cheaper than the local Asda that is just 1 mile away. Both are self serve so don't need operators to take payments and at the lorry stop you get a free cup of coffee for filling up. If retailers were on such thin margins not sure how this garage could sell their diesel. I appreciate that filling a lorry will be more litres and therefore they probably have a high turnover of fuel but would expect this to be the same for the local Asda that often has a que outside.


Friend of mine was filling up his car next to a lorry yesterday, the lorry's fill up price was £1049

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Petrol stations operating on "razor thin margins" on 14:14 - Jun 30 with 328 viewsghostofescobar

Like the Wilkinson Sword factory.

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