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Officials: Boycotts misplace BP blame

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Catherine W. Idzerda
Tuesday, June 8, 2010
— For some drivers, BP’s green and yellow sunflower logo has ceased to represent gas, a gallon of milk and a quick snack.

Instead, the big sunflower is a reminder of the oil pouring into the Gulf of Mexico, and for some it’s enough to make them take their gasoline business elsewhere.

In the middle of those two visions, are convenience store owners, whose livelihoods depend more on the milk and the snacks than the gasoline.

Unfortunately, those kinds of boycotts hurt only local business people, state and local industry representatives say.

Statewide, gas station owners with BP signs out front are anxious, but they haven’t noticed a significant drop in sales, said Pam Christenson, director of public affairs for the Wisconsin Petroleum Marketers & Convenience Store Association.

The BP brand has about a 30 percent market share in Wisconsin, but it doesn’t own any gas stations. It got out of that business many years ago, explained Alicia Clark, director of retail operations for the Janesville-based Golden Oil.

Golden Oil Company owns 10 gas stations and has a network of 20 dealers and supplies BP gasoline to all of them.

“Many people don’t really know how the industry works,” Clark said. “Independent, local, owner-operators run them. They have nothing to do with BP.”

And here’s the kicker: Those owner-operators make almost no money on gas sales.

“The margins on gas are razor thin,” said Christenson.

How thin?

“Pennies on the gallon,” Christenson said.

Then, every time a consumer swipes a credit card, the card company takes a percentage.

For example, if gas was $3 a gallon, a credit card company would get between 6- and 9-cents a gallon.

It’s inside sales that matter, both Christenson and Clark stressed.

“People aren’t going to make two stops, one for gas and one for something else,” Clark said.

Most station owners don’t have the ability to rebrand, even if they wanted to—they’re under contracts that average about 10 years.

And even though station owners make almost no money on gas, those sales are still important to the business.

“Part of the value of the business is based on the number of gallons sold,” Cark said.

Last updated: 2:08 pm Thursday, December 13, 2012

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