Prices rise, profits don't
Gas station owners struggling
By Barbara Hagenbaugh
FALLS CHURCH, Va. — Gas station owner Rob Garrett knows drivers are frustrated with high gas prices. What they probably don't realize is that he is, too.
"It hurts us too; that's the thing (drivers) don't understand," he says, looking over a spreadsheet that lays out his expenses on his laptop computer.
Gas station owners like Garrett, 45, prefer to see prices lower because that's when margins tend to be wider. When prices are high, they can't mark up prices as much and often struggle to cover their costs, instead hoping to make money in sales of food, car washes or other goods and services.
"If I didn't have a repair center and a car wash, I'd be in big trouble," he says.
Customers often don't understand that he is a small-business owner, not an extension of "Big Oil." Garrett owns two stations in Northern Virginia and one in Washington, D.C., under the Sunoco name, and has been in business for nine years.
Lately, he says, he and his employees have been receiving a lot of complaints from customers. Although he tries to explain his situation, people don't want to hear it.
"We're the face" of the oil companies, Garrett says. The money the oil companies are making, he says, is "not getting to us."
Pumping gas into his Jeep Grand Cherokee at Garrett's station, Steve McFarland, 52, says he puts the blame on oil companies, arguing that the fact that so many refineries have been shut down in recent months for maintenance suggests they are trying to keep gasoline off the market to lift prices.
"They just created their own shortage," says McFarland of Falls Church, who works the early-morning shift in the produce department at a Safeway grocery store.
Brian Dor, 33, of Arlington, Va., withdrew the nozzle from his Toyota Matrix when the price hit $30 — what he had in his wallet.
Dor works as a contractor for airlines at nearby Ronald Reagan Washington National Airport. He delivers lost luggage to people's homes when their bags turn up. He's been able to recoup some of the increase in gas prices through higher fees, but not all.
"The more gas, the less profit," Dor says.
Garrett can relate.
On a recent morning Garrett was charging $3.11 a gallon for regular. He paid $2.58 a gallon for the gasoline from his distributor. Another 42 cents went to a mishmash of taxes for federal, state, a local transit fee and others miscellaneous taxes. Six cents went to credit card fees.
That left him with approximately 5 cents a gallon in profit. But that doesn't account for his payroll, utilities, rent and other overhead costs that are also increasing.
"My profit is going down from year to year," he says. "The future, I'm a little worried about."
Vince Halsey, 22, of Fort Washington, Md., is also worried. The 22-year-old student and part-time sales manager at a nearby Gold's Gym says it's been hard watching prices increase week after week.
"I put in $30 and it's not even halfway full," he says, filling his car's tank. "It's ridiculous."