Mark Garnier, MP for Wyre Forest, is calling on residents to boycott supermarket petrol pumps in favour of the independent retailer. This is after learning that the big retailers such as Tesco and Sainsbury’s charge nearly triple the profit margin, compared to locally owned petrol stations.
Mark is still receiving replies from letters he sent to local fuel companies complaining about the high local prices. In his enquiries, he has asked why prices are up to 6p per litre more in Wyre Forest than neighbouring Dudley. Sainsbury’s and Tesco both state that the local prices are determined by local managers and are there to reflect local competition. They also state that prices are frequently allied to local offers. Examples of this include discounts after spending more than £60 at a local store.
Mark says: “Frankly, this does not address the important point. It is all very well offering discounts but these discounts are also available in Wolverhampton, an area which already offers significantly lower prices. The explanation given is, to my mind, insufficient and I would question whether there is a local cartel operating between the fuel companies.”
The fuel sold by supermarkets in and around Wyre Forest comes from same wholesaler. Mark visited Helen Needham of Callow Oil in Sandy Lane to learn more.
Callow Oil, at their Chaddesley Corbet filling station, operates on the basis of a fixed margin. Helen explained that the most recent wholesale price of unleaded was 102.94p per litre. Transport costs are 1p per litre and their profit margin is 3.5p per litre. Add VAT and the pump price is 128.9. The same process is applied to diesel, the wholesale price of which is 112.52p per litre. This equates to a pump price of 140.9p per litre. Tesco and Sainsbury’s will be paying an identical wholesale price, so their profit margin is closer to 8.5p per litre of unleaded.
Mark says: “The big supermarkets are charging Wyre Forest residents nearly three times the profit margin than Callow Oil; that is simply not fair. Helen at Callow has assured me that her company will not charge a higher profit margin than 3.5p per litre and I am urging all Wyre Forest residents to go to Callow to buy their fuel. By boycotting the big retailers, we can send a clear message that Wyre Forest is not prepared to pay top prices for their petrol.”
Mark has undertaken to update the price of Callow Oil’s Chaddesley prices on a weekly basis on his website, and urges local newspapers to do likewise.