Wholesale Distributor

Convenience Store News

Convenience Store News
Because fuel is so essential to daily life and consumers are so price sensitive, gasoline is unlike any other product sold in the United States today. Gas prices are often the part of daily conversations, and customers will seek out the best “deal” that they can find. Yet, while customers know the price, they don’t necessarily know about the fuel or about what goes into the price or about the stores that provide 40 million fill-ups every day.

Convenience stores sell 80% of the fuels purchased today. While motor fuels drive sales dollars for convenience stores, in-store sales drive profit dollars. On average, 71% of a store’s total sales are motor fuels, but motor fuels only account for 36% of profit dollars. That is because retail fuel margins are very thin, averaging less than a nickel per gallon. Retailers know that consumers are incredibly price sensitive and will go somewhere else to save a few cents per gallon of gasoline.

For more than a decade, NACS has developed its annual Retail Fuels Report to explain market conditions, especially as they relate to price swings. While the circumstances may be different year-to-year, the overall pattern in the petroleum markets is surprisingly familiar. The first week of February traditionally marks the beginning of the spring transition to summer-blend fuels for the petroleum industry. Since 2000, gasoline prices have increased, on average, more than 50 cents between the first week in February and the time of the seasonal high price, which occurs typically in late May. In both 2007 and 2008, gasoline prices jumped more than $1.00 in that period.


Convenience Store Update:

Key Facts and Figures

  1. The 123,289 convenience stores that sell fuels in the United States cumulatively sell 80% of the motor fuels purchased in the country.
  2. Americans travelled 8.038 billion miles per day in 2012.
  3. There were 156,065 total retail fueling sites in the United States in 2012. This is a steep and steady decline since 1994, when the station count topped 202,800 sites. This count includes convenience stores, grocery stores, truck stops, traditional gas stations and low-volume locations like marinas.
  4. While about half of the convenience stores selling gasoline are “branded” outlets selling a specific refiner’s brand of fuel,
  5. they are typically not owned by the refiner. Major oil companies own and operate less than 0.4% of all convenience stores in the
  6. U.S.: Chevron Corp. (415 stores), Shell Oil Products US (38 stores), ExxonMobil Corp. (13 stores), BP North America (3 stores) and
  7. ConocoPhillips Inc. (2 stores).
  8. Alternative fueling stations are growing across the country. There are now about 8,000 stations (about 5% of all fueling outlets) that offer public access to alternative fuels in the lower 48 states.
  9. The average American uses 1.8 barrels of oil every month, or 0.053 barrels per day.
  10. U.S. gasoline demand was 8.73 million barrels per day in 2012, or about 40 million fill-ups per day. U.S. gasoline demand has decreased 6.1% since peaking in 2007.
  11. For small light duty vehicles (the 190.2 million passenger vehicles, vans, small trucks and SUVs with a wheelbase of 121 inches or less), the average fuel usage was 453 gallons consumed per year, which averages out to 1.24 gallons per day or 8.7 gallons per week.
  12. These vehicles had an average fuel efficiency of 23.5 mpg and travelled 29.1 miles per day.
  13. Brent spot oil prices averaged $111.65 per barrel in 2012. They are expected to average $105.17 in 2013.
  14. U.S. retail (regular) gasoline prices averaged a record $3.63 in 2012, and are expected to average $3.44 per gallon in 2013. On-road diesel fuel prices averaged a record $3.97 per gallon in 2012, and are expected to decrease to $3.87 per gallon in 2013.
  15. Since the final implementation of the Clean Air Act Amendments in 2000, the seasonal transition to summer-blend fuel has helped gasoline prices rise significantly.
  16. The average annual increase is 54 cents.
  17. Gasoline taxes averaged 48.8 cents per gallon in January 2013.
  18. Nearly three quarters (72%) of all transactions at the pump are by plastic — either debit or credit card.
  19. Factoring in all gasoline sales, credit and debit card fees averaged 5.7 cents per gallon in 2011.
  20. The gross margin (or markup) on gasoline in 2012 was 18.4 cents/gallon, or 5.1%. Over the past five years, gross margins averaged 16.9 cents per gallon.
  21. Motor fuels sales contributed to roughly one-third of total convenience store gross margin dollars (35.9%).

The U.S. petroleum distribution industry includes:
•  144 refineries
•  38 Jones Act vessels (U.S. flag ships that move products between U.S. ports)
•  3,300 coastal, Great Lakes and river tank barges
•  200,000 rail tank cars
•  1,400 petroleum product terminals
•  100,000 tanker trucks
•  200,000 miles of oil and refined product pipelines