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BDFL - Memuneh
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#2073704 15-Aug-2018 09:30

Really liked how Amex had a promotion last month for $20 back on fuel over $60 - I managed to get two full 50l tanks on $0.10/l discount days and got $20 cash back on each one on top of that.

Not complaining about July ;)

frankv

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#2073829 15-Aug-2018 11:28

Right... forgot about credit card rewards. I always buy petrol using my Visa, so get HotPoints from the fuel purchase too.

UHD

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#2074937 17-Aug-2018 16:55

sbiddle:

elbrownos:

If you use Smartfuel correctly it can save you over 20c/L off the advertised price.

So as far as I know, it's currently the best petrol discount scheme in the country.

It's a rort. The retail price of fuel is inflated by 10cpl just so they can offer you 10cpl off.

The ACCC in Australia banned fuel voucher schemes years ago when they got to 40c because it was skewing the fuel market, but it seems NZers are slow to learn.

You assert this a lot and I'm yet to see your evidence. The providers without discount schemes are not all 10c/L cheaper than BP and Caltex so mathematically you have to be wrong and there is still a savings using the scheme. Perhaps not as great as some people think but it is certainly the best deal in NZ.

Where I live the best Gull, Allied, etc... beat BP by is 6c/L which means I still make a 4c/L saving over every other fuel company in NZ (rort or not) because BP and Caltex do 10c/L discounts weekly.

I put $40 worth of fuel in the car every week (usually a Tue or Wed) on the 10c/L discount day which is always at least 4c/L cheaper than the others if I were to take the discount and not accumulate the savings.

Additionally, I'm able to add 6c/month (sometimes 9c/month) by doing monthly shops at Countdown and our local fish & chip store offers 3c/L on orders over $25 (for the odd treat) and my parents are Contact customers and let me add my card to their account for the 30c/month bonus since they don't use Smartfuel (they use a fuel card).

Assuming petrol prices ($2.049/L for Gull/Allied and $2.109/L for BP) stay the same all year (lol) we'd pay $2,080/year for 1,015L of 91 at Gull/Allied or $1,788/year for 1,058L of 91 at BP.

Obviously, prices fluctuate weekly or more often but they generally do so in line with that same 4c/L margin so I'll assume the same price all year for simplicity.

I calculate that Gull/Allied annual cost is 40 * 52 = 2,080 which at 2.049/L nets me 2,080 / 2.049 = 1,015L each year.

The BP/Caltex calculation is slightly harder since there are a few conditions. Just taking things at face value without Smartfuel at all I would pay $2,080/year and receive 986L of 91. You're definitely being ripped off if you don't use Smartfuel and use BP/Caltex.

I fill up once a week on the 10c discount day and then a 50L fill at the end of every 2 calendar month period (eg: Jan-Feb, Mar-Apr, May-Jun, Jul-Aug, Sep-Oct, Nov-Dec) as per Smartfuel conditions.

As I have a 60L fuel tank I do not fill up in the week prior to the 50L fill so I can maximise the savings. I can draw a schedule of the fills I do and then calculate the amount of fuel I receive and the price I pay. I skip the occasional 9c/month Countdown shop or an extra fish & chips run for simplicity.

This uses 2018 as an example:

Jan-Feb: 9 weeks. 7 fills (132.76L) @ 10c accum., 1 week skipped, 1 50L fill @ 0.629
Mar-Apr: 8 weeks. 6 fills (113.80L) @ 10c accum., 1 week skipped, 1 50L fill @ 0.629
May-Jun: 9 weeks. 7 fills (132.76L) @ 10c accum., 1 week skipped, 1 50L fill @ 0.629
Jul-Aug: 9 weeks. 7 fills (132.76L) @ 10c accum., 1 week skipped, 1 50L fill @ 0.629
Sep-Oct: 9 weeks. 7 fills (132.76L) @ 10c accum., 1 week skipped, 1 50L fill @ 0.629
Nov-Dec: 8 weeks. 6 fills (113.80L) @ 10c accum., 1 week skipped, 1 50L fill @ 0.629

The amount of fuel I pump each year can be calculated by: (132.76 * 4) + (113.80 * 2) + (50 * 6) = 1,058.64

The price I pay can be calculated by: (((132.76 * 4) + (113.80 * 2)) * 2.109) + ((50 * 6) * 0.629) = 1788.67

So instead of paying Gull/Allied/etc... $2,080 each year I pay BP $1,788 each year and have an additional $292 for the odd road trip/car repair/WoF/registration. I drive past both BP & Gull on my way to work every day so it is not a waste of my time to visit either.

Can you explain the rort in this situation?

sbiddle

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#2074938 17-Aug-2018 16:59

UHD:

Can you explain the rort in this situation?

Simple.

Discounting schemes distort the retail price of petrol. End of story.

The retail price is being inflated to factor in these discounts when those discounts are provided by Z, BP, Caltex and Mobil. That is wrong.

mudguard

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#2074943 17-Aug-2018 17:16

UHD:

The amount of fuel I pump each year can be calculated by: (132.76 * 4) + (113.80 * 2) + (50 * 6) = 1,058.64

The price I pay can be calculated by: (((132.76 * 4) + (113.80 * 2)) * 2.109) + ((50 * 6) * 0.629) = 1788.67

Is my maths wrong or have you paid $1.68 per litre over the past year doing this? I've averaged $1.93 for the last year for nearly 4000L.

UHD

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#2074957 17-Aug-2018 18:14

@mudguard that would be correct if petrol was consistently $2.109/L but it does fluctuate so my spreadsheet is slightly different. The margin between Gull/Allied and BP's 10c discount has remained the same though: ~4c/L.

The figures I gave just made the math easy to follow.

@sbiddle so your objection is a moral one rather than what is best for the wallet every day? It is likely the case that the discount schemes do distort the price of petrol but we'd still be worse off if there was no scheme allowed and everyone just sold petrol at $2.049/L like my example.

The real question is: if these schemes do distort prices by ~10c/L as you claim then why do Gull/Allied/etc... not price their petrol consistently 10c/L lower than BP and Caltex? If they did that then the schemes would dry up overnight.

nickb800

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#2074992 17-Aug-2018 19:47

UHD:

@sbiddle so your objection is a moral one rather than what is best for the wallet every day? It is likely the case that the discount schemes do distort the price of petrol but we'd still be worse off if there was no scheme allowed and everyone just sold petrol at $2.049/L like my example.

The real question is: if these schemes do distort prices by ~10c/L as you claim then why do Gull/Allied/etc... not price their petrol consistently 10c/L lower than BP and Caltex? If they did that then the schemes would dry up overnight.

It's absolutely a rort as it artificially inflates the retail price, but we as individuals can't influence the price of fuel. So our best bet is to play the game, as we are better off playing than not.

The fuel retailers sell an identical product with limited ability to differentiate - so if they ended up in a price war, it would be difficult to end. That's why you won't see non-discount retailers closing the pricing gap - a little bit of a price difference is fine, as long as everyone gets a reasonable volume through

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mudguard

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#2074994 17-Aug-2018 20:06

I think ultimately it depends when you are, I'm based in Auckland, but travel the country each month. I don't pay much attention to the pump price when I'm in rental cars, but I'm lucky enough to be able to fill up consistently outside Auckland. Last week Gull Atiamuri was selling for $1.85 which surely must be the lowest in the country. Yet 91 in most of Christchurch and the upper South Island where I worked this week was $2.20-$2.30 so worse than Auckland. I don't have the luxury of timing when I fill up, sometimes I have to fill twice on the same day! So where I have my car (as I get reimbursed) I simply fill up where I see the lowest pump price, which is usually the self serve Gulls, NPD, Waitomo etc.

I looked into the whole reward scheme and bulk buying but none of it was beneficial for me.

tukapa1

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#2075114 18-Aug-2018 07:08

I just have a farmsource card which gives me a 16c discount at Mobil. No minimum purchase needed. The other day as I drove past on my way to work Mobil was $1.939 so by filling up with whatever amount I needed it cost me $1.779 litre (91).

The farmsource card is currently free, no account fees so why not.

Used to use smartfuel but this is easier.

Goosey

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#2075118 18-Aug-2018 08:10

Does anyone actually use Pak n Save fuel? and also in the south island does anyone actually cash in their fuel discounts that accumulate?

sbiddle

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#2075182 18-Aug-2018 09:12

nickb800:

The fuel retailers sell an identical product with limited ability to differentiate - so if they ended up in a price war, it would be difficult to end. That's why you won't see non-discount retailers closing the pricing gap - a little bit of a price difference is fine, as long as everyone gets a reasonable volume through

They don't sell the same product though - Gull sell ethanol blended biofuel which depending on your view is ether good or bad. Blending ethanol also allows them to avoid paying the same excise tax on their fuel which is one of the reasons why their product is cheaper.

As a result of one player selling a cheaper product we have a price war, which has resulted in customers in areas where Gull isn't effectively subsidising fuel costs for the big four so they can discount.

Going back 4-5 years ago retailer margins were in the vicinity of 16-20 cpl. The widespread introduction of loyalty schemes has seen that double and often sit around the mid 30 cpl. That factors in instant discounts (which are only used by around 60% of customers based on the last data I saw) so with 40% of customers paying retail that offers good margin to allow for discounting.

Where petrol is still selling for over 25cpl less in some parts of the country and retail discounts are applied on top it's being sold effectively below cost, so people like us in Wellington are subsidising that.

sbiddle

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#2075183 18-Aug-2018 09:13

UHD:

@sbiddle so your objection is a moral one rather than what is best for the wallet every day? It is likely the case that the discount schemes do distort the price of petrol but we'd still be worse off if there was no scheme allowed and everyone just sold petrol at $2.049/L like my example.

A distorted market is a bad market. Everybody would be better off if discounting was banned, which is exactly why Australia banned supermarket discounts in excess of 4cpl in 2014.

sbiddle

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#2075184 18-Aug-2018 09:15

Goosey:

Does anyone actually use Pak n Save fuel? and also in the south island does anyone actually cash in their fuel discounts that accumulate?

I use Pak 'n Save most of the time. Instant 6cpl discounts with no minimum $ purchase instore or at the pump and often they often have the cheapest fuel in the area even before the 6cpl discount. Part of that reason though if that I refuse to support Z Energy these days due to their business model and even sold my shares.

Buster

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#2075201 18-Aug-2018 10:25

We used to gas up at pak n save with the weekly family groceries but the four kids have grown and all moved out and we prefer to use 98 rather than 95 in our current cars.

Last month we saved $116.50 when we redeemed our two months savings which is fairly typical for us. So annually that is about $700. Our savings are achieved about 75% buying petrol and 25% from other non petrol related purchases in the scheme. Over all a mixture of 6, 10, and 12 cents savings on the petrol purchases.

There must be plenty out there that would achieve those savings every month so $1400 per annum.

mudguard

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#2075309 18-Aug-2018 14:52

sbiddle:

They don't sell the same product though - Gull sell ethanol blended biofuel which depending on your view is ether good or bad. Blending ethanol also allows them to avoid paying the same excise tax on their fuel which is one of the reasons why their product is cheaper.

Do you they only have biofuel in their 98 fuel? I think it's not in any of the lower octane fuels now?

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