FUEL TAX INCREASE PUTS EXTRA HEAT ON SMALL BUSINESSES

May 14, 2014: The Australasian Association of Convenience Stores (AACS) has criticised the Federal Government’s move to increase fuel excise for not only putting extra pressure on motorists, but also turning up the heat on convenience store retailers already faced with challenging retail conditions.
“Fuel is already a very low margin product for petrol station retailers, who, for all their efforts and hours worked, make far less revenue than the Government on this product,” explained AACS CEO Jeff Rogut.
“Competitively priced fuel also encourages merchandise sales for these small businesses when customers visit the store. These additional sales are crucial to the profitability and even viability of some of these stores.
“Slugging motorists extra for a basic commodity like fuel will put a significant dent in consumers’ capacity to purchase additional items, potentially incurring substantial harm to convenience stores country wide.”
The AACS State of the Industry Report unveiled last week showed that while fuel sales were flat in 2013, pricing remained at its highest point since early 2012 for most of the second half of the year, affecting merchandise sales.
“Of course, consumers will invariably blame retailers for the ever-higher petrol prices, increasing customer frustration, even though the retail margins for petrol sales are very tight,” Mr Rogut said.
“The impact of the excise increase on the spiralling crime of petrol theft is another consideration Government has ignored. Petrol theft, which occurs when motorists fill up then drive off without paying, cost Australian convenience stores $45 million in 2013, a 16% increase on 2012. Incidences of this crime tend to spike as prices rise.
“Too often it is small businesses which must bear the brunt of measures designed to fill the budget hole.
“The AACS urges Government to recognise the critical role these small businesses play in the overall economic landscape in Australia, as well as the many people they employ at the local community level,” Mr Rogut said.
Further information:
Jeff Rogut
Chief Executive Officer
Australasian Association of Convenience Stores
Ph: +61 467 873 789
Media enquiries:
Stephen Naylor
Wise McBaron Communication
Ph: +61 (2) 9279 4770