What’s the real price of petrol?

The price of petrol is a perennial headline grabber. You would think, by now, enough journalists reporting on the subject would have ’got to the bottom of it’; ie the public would know that the retailers have nowt to do with the price at the pump, even if they do own the ruddy pumps.

Let’s start with somewhere nice and local. The price on the pump at Tagon Stores today (the date as this is being written is the apocalyptic nine-eleven) was 147.0ppl for petrol and 151.0ppl for diesel (the owners don’t do those teensy-weensy decimal points; they keep it rounded and grounded).

So, you are wondering, local to whom?

Okay, the Tagon Stores station in question is Scott and Phoebe Preston’s gaff on Shetland. And believe you me, their station is very much local to the erm, locals who find it a bit difficult to go elsewhere. Mind you, when they do go elsewhere, they undoubtedly fill their tanks, because on the mainland, some 200 miles away, it can be up to 17ppl cheaper. Take Aberdeen on the same day: 132.9ppl for petrol and 136.9ppl for diesel.

I’m in London and today it’s 138ppl around the corner, although I could get 10p off per litre if I bothered to drive four miles to my closest mega Sainsbury with the voucher they regularly lob at me.

The prices on Shetland (and indeed the other islands in the vicinity) don’t face supermarkets’ petrol promotions but they do carry an added complication just in case you thought everything in the forecourt world was transparent and nice and clear, ha, ha.

HMRC gives 5ppl back as a duty rebate to all retailers on Shetland who are part of a scheme introduced in January 2012, on the condition they reduce the pump price by 5ppl for the end consumer. This was an attempt to bring prices in line with the mainland.

But how did this work in reality?

Scott says: "The figures given by the former chairman of Scottish Fuels/GB Oils (supplier to the region), Sam Chambers, showed that it costs 2.71ppl to ship and the gross profit is 4.24ppl so that makes a total of 7ppl.

"But because of the 5p duty relief, it should be a 2p differential, which most people would be prepared to pay."

As Scott adds, it is stupidly confusing to one and all.

But then he says, after this 5p derogation was introduced in early 2012, he and others did indeed reduce their price to the consumer by 5p. "But in about three days the price went up from my supplier by 3p and the following week by another 2p."

You know, even Scott and I, both self-confessed numbnuts at sums, could add those two up to the 5p reduction previously introduced.

He adds: "Alistair Carmichael, the MP for Shetland and Orkney, and Tavish Scott MSP have both campaigned on the issue of excessive charging for fuel in Shetland. The 5p derogation was introduced to bring us closer to mainland prices. Clearly this has failed!"

Scott has summed it all up for us too. "To put the whole fuel thing into context, our sales of fuel last year were £297,837; this includes £9,439 in rebates from HMRC. The purchases of the fuel came to a total of £297,003 meaning our total profit margin on fuel was 0.28% or £834 yes, you read that correctly, LESS than 0.5% profit margin GROSS on fuel. Good job we sell Mars Bars too eh?

"Once we include the servicing of the pumps at a cost of £375 and the cost of running them and a proportion of the insurance plus the licences to store the fuel we are making a grand total of £NOTHING."

Of course, Scott acknowledges that fuel is a huge footfall driver and is very important for a c-store but concentrating on the wet side alone cannot make you a living.

Let’s hear it for common sense

That Norfolk police officer Kelly Jones, who was seeking compensation from forecourt retailer Steve Jones (no relation!), after she tripped on a kerb in August 2012 after being called to a suspected break-in at Steve’s Nuns’ Bridges Filling Station in Thetford, has withdrawn her claim for injuries. Steve said in the national press that he was pleased that common sense prevailed. Norfolk police said the same thing.

And so say all of us!

Mi scuso, me disculpo, ich entschuldige mich, je m’excuse

Jon Brownsey, unfortunately (for him), is a regular contributor owing to the ongoing problems (20 months plus) he has had at Fordingbridge Service Centre in Hampshire with his Micros system.

On top he has had a woeful few months of unrelated retail grief this summer but says by way of an update: "Micros is apparently working on an upgrade and I’ll be the first to get it. You have no idea how much dread that fills me with."

And to prove that he still finds space for a joke, he adds: "We have a lady who works part-time who is bi-lingual, and was able to apologise to some Dutch tourists in their own language another first for the business. Perhaps I need to get a phrase book drawn up so I can say in 50 different languages "I apologise for keeping you waiting, it’s because my tills are s**t".

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