Letter: Station owner not to blame for high gas prices
Who is to blame for the high gas prices in the Verde Valley? Hopefully I can shed some light on the subject. My father, John Deming, operated two service stations in the Prescott area for over 27 years. I worked for my dad for about 12 of those years.
We had to change with the times. In the 1970s and early '80s, we were a mainly full service station. Yes we actually washed windows, aired your tires, and checked your oil, and yes, we charged about .15 cents more per gallon for the service.
Soon however, the self-service revolution changed the service station business forever. People demanded lower prices, President Ronald Reagan de-regulated the industry, and prices dropped even more. Small service station owners found themselves being squeezed even more, as larger, more modern gas stations were being built without auto repair, a place to gas up and get your pop, chips, smokes and beer.
To entice customers, these big c-store stations would offer lower gas prices than what my dad could compete with, to make the real profit, not from gasoline, but from the huge mark-ups on convenience items. Eventually, my dad went out of business, unable to make enough profit on the auto repair side to keep the doors open.
The gas price today is the "lost leader" to get the customer in the door. I would be surprised if any gas station, in any market in America, is making over one or two cents per gallon, certainly not enough to pay the rent.
It's the oil companies that set the prices for all areas of the United States, not the local franchisee. The local business person must keep their prices in line with the local market leaders, to keep the customers coming in the door for the real profit, convenience items.
Go ahead and ask the owners where their real profit comes from. If I'm wrong, please let me know! Hopefully, the prices will come down to a fair price in our area, so we all can afford to get to work.
In the interim, our government and private enterprise need to explore better forms of energy to get us off this oil habit. Trust me, the oil companies don't want this to happen. They want to continue making their profits.