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Posted on 2/5/19 at 11:43 am to Obtuse1
quote:
There is a valid question as to why they don't pertain to all goods but fuel being so closely related to commerce, in general, may be the answer.
The gas station model, especially the independent station, is an old, outdated model. Buc-ees is a market disrupter. They have a different model.
Their model is no different than many other retail formats, that have loss leaders. Their loss leader just so happens to be gasoline.
Comparing one of their locations to your typical 8 pump small gas station that has a c-store with dusty snacks and broken toilets that closes at 9 pm, is stupid. To force them to abide by this law is stupid as well. It's disgusting that a so-called conservative state would have such protectionist laws. But not surprising - as we all know wealthy GOPers want big government as well.
Posted on 2/5/19 at 11:44 am to TheCaterpillar
quote:
Why are you buying t-shirts tat Buc-ees?
"Buy-em a nutty-buddy diddy, it'll shut-em up if you do."
Wisdom imparted on me by a local, witnessing my lack of ability to control the persistence from my children.
Posted on 2/5/19 at 11:45 am to MeridianDog
quote:
Maybe they can offer a free bag of Buc-ees nuggets with any gas purchase and some jerky if the purchase is above a certain amount. I guess at that point, the legislature would go after then for offering addictive stuff as gas premiums.
Kinda like how Southwest Airlines, unable to lower their prices any further due to regulation, offered a free bottle of booze with every ticket.
Posted on 2/5/19 at 11:55 am to LSUFanHouston
quote:
And then, when prices have moved to such high levels, the market will attract new entrants, who will likely buy the old assets/station, open quickly, and drive the prices back down.
Economics 101.
You are exactly right re Econ 101, it is indeed a view that doesn't look past basic macro. The problem is the established company can just reduce prices below wholesale again and drive the new competition out of business when they are most vulnerable. This cyclical roller coaster can also result in a string of bankruptcies which are also against public policy. At some point, new businesses will not attempt to re-penetrate the particular market. This is bad for business as well as the consumer.
The core is that pure market economies have as many ills as those that are too highly regulated, the key is reaching a balance. I think it is reasonable regarding basic commodities like fuel to prevent the sale at below wholesale.
Posted on 2/5/19 at 11:58 am to MeridianDog
quote:
Maybe they can offer a free bag of Buc-ees nuggets with any gas purchase and some jerky if the purchase is above a certain amount. I guess at that point, the legislature would go after then for offering addictive stuff as gas premiums.
The Alabama legislature thought of this as well:
Section 8-22-10
Below cost combined selling price of motor fuel and promotional gifts, etc., prohibited.
In all advertisements, offers for sale or sales involving two or more items, at least one of which items is motor fuel, at a combined price, and in all advertisements, offers of sale, or sales, involving the giving of any gift or concession of any kind whatsoever (whether it be coupons or otherwise), the wholesaler's or retailer's combined selling price shall not be below the cost to the wholesaler or the cost to the retailer, respectively, of the total of all articles, products, commodities, gifts, and concessions included in such transactions, except that if any such articles, products, commodities, gifts, or concessions, shall not be motor fuel, the basic cost thereof shall be determined in like manner as provided in subdivision (14) of Section 8-22-4.
ETA the legislative intent code section
Section 8-22-3
Legislative declaration and intent.
It is hereby declared that marketing of motor fuel in Alabama is affected with the public interest. It is hereby declared to be the legislative intent to encourage fair and honest competition, and to safeguard the public against creation of monopolies or unfair methods of competition, in transactions involving the sale of, or offer to sell, or inducement to sell motor fuel in the wholesale and retail trades in this state. It is further declared that the advertising, offering for sale, or sale of motor fuel below cost or at a cost lower than charged other persons on the same marketing level with the intent of injuring competitors or destroying or substantially lessening competition is an unfair and deceptive trade practice. The policy of the state is to promote the general welfare through the prohibition of such sales. The purpose of the Motor Fuel Marketing Act is to carry out that policy in the public interest, providing for exceptions under stated circumstances, providing for enforcement and providing penalties.
This post was edited on 2/5/19 at 12:03 pm
Posted on 2/5/19 at 12:00 pm to TejasHorn
bust their arse Beaver
Posted on 2/5/19 at 12:00 pm to TheCaterpillar
quote:
This is free market. I don't get why this could be illegal in any way.
Do the names John D. Rockeller and Standard Oil ring a bell? Is so, you should know the answer to this question.
Posted on 2/5/19 at 12:00 pm to Tridentds
quote:
Think this is pretty much part of their strategy when they open a new location. They opened one up close to us across from a Chevron and gas and diesel prices were lower by $.20 - $.22 a gallon for about a week before Chevron responded. They had a price war that went on for about 5-6 months. Eventually both of them came up but Buc-ees still has the lowest price around here. Chevron is 1 or 2 cents higher usually.
Exactly.
Their prices will go up in another week or two. There are two Bucee's close to my house and while generally their gas is the low is isn't too far off from WalMart of HEB prices.
Posted on 2/5/19 at 12:02 pm to chryso
quote:
You geniuses don't understand how this can sometimes work. A new gas station with a lot of capital will come in and sell below cost until they drive the competition out of business. Then when they are the only one left they raise the price to exorbitant levels.
This has happened and this is why there are laws against it.
I've been to a lot of Buc'ees locations. I have yet to see them charge something asinine for gas. They ware always the lowest if not the lowest in the area.
Posted on 2/5/19 at 12:03 pm to TejasHorn
Gas is currently lower than $2 at several stations in Mobile. I don’t understand that bs.
Posted on 2/5/19 at 12:06 pm to Obtuse1
quote:
he core is that pure market economies have as many ills as those that are too highly regulated, the key is reaching a balance. I think it is reasonable regarding basic commodities like fuel to prevent the sale at below wholesale.
if you want to take a more nuanced view at economics... then you need to completely do so. You need to look at the positive economic impacts of the large retailer.
Take Buc-ees. Let's say it does indeed put one or two stations out of business, and let's say that those locations are never replaced.
2 years down the road, the local economy has more jobs - even accounting for the closures - than it did before the arrival of Buc-ees. It likely is selling more gas and other items - in the local area - then it did before, due to the large store attracting new customers, who choose to stop there than stop in the next county or state. Those items in the store are subject to sales tax - positive impact on the local government.
While it will most undoubtly suck for the couple of stores that do close, their employees will likely end up at the Buc-ees anyways (probably making more money). The overall economic impact will be a net positive to the local economy.
Of course there is another alternative - the smaller stations, who maybe can no longer offer the cheapest gas in town, can compete in other ways. Offer a free drink with every fillup (which gets people inside the c-store). Try to have even clearer bathrooms. Sell more hot food. Etc.
Remember, you can compete on price or service. Buc-ees is such a killer because it manages to compete on both. But, not all customers want to deal with a huge store and 120 pumps. The smaller fuel store can survive - but it needs to change to do so.
And that's the real issue - small businesses often do no want to innovate. It's easier to just band together and get protection.
Posted on 2/5/19 at 12:07 pm to chryso
quote:
You geniuses don't understand how this can sometimes work. A new gas station with a lot of capital will come in and sell below cost until they drive the competition out of business.
Maybe bucees just gets their gas at a lower cost.
Posted on 2/5/19 at 12:17 pm to chryso
quote:
You geniuses don't understand how this can sometimes work. A new gas station with a lot of capital will come in and sell below cost until they drive the competition out of business. Then when they are the only one left they raise the price to exorbitant levels.
yeah, just like Walmart does to Mom & Pop. once those little shite stores are gone, Walmart gouges the consumer...Oh wait, no they don't.
Posted on 2/5/19 at 12:19 pm to keks tadpole
quote:
FWIW: Their sliced brisket sandwich is the best BBQ sandwich I have ever had. No lie
You are definitely not lying.
Posted on 2/5/19 at 12:27 pm to TigerStripes06
quote:
Maybe bucees just gets their gas at a lower cost.
I just read the request for relief. It clearly states, on multiple occasions, that Buc-ees is selling gas at below cost, with cost defined by the Act. However, if you read the definition of cost in the Act, it discusses that it is basically the cost to the company.
Nowhere in the relief does it indicate what that cost is. Moreso, I have no idea how the Oasis knows the cost that Buc-ees is paying. Buc-ees is a private company and I'm sure that information is a close secret.
Can gas stations get a better price if they buy larger quantities at wholesale? Or does every wholesaler in the state have to sell gas to all retailers at the same price?
Posted on 2/5/19 at 12:29 pm to LSUFanHouston
quote:
Nah, there are laws against this because AL, like most other states, likely has a very active group of independent fuel station owners, who donate a lot of money to Alabama legislators.
It's a protection racket.
A protection racket passed under the guise of “consumer protection”
Posted on 2/5/19 at 12:34 pm to beerJeep
quote:
Yep, that cheap gas totally hurts the public by saving them money
Yep. Because they assume the peasants will obviously spend their meager savings on cigarettes and cheap wine.
This post was edited on 2/5/19 at 12:35 pm
Posted on 2/5/19 at 12:37 pm to Fonzarelli
How though? They are all buying it from a handful of the same suppliers.
Posted on 2/5/19 at 12:43 pm to BayouBengals18
quote:
FWIW: Their sliced brisket sandwich is the best BBQ sandwich I have ever had. No lie
You are definitely not lying.
Ive had the bbq turkey a couple times in a pinch, but had generally read the BBQ wasn't that good. My sandwiches have always been taste but not some OMG moment
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