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Published: Wednesday, 4/13/2005

Grocery store chains increase sales of food for customers' cars

BY JON CHAVEZ
BLADE BUSINESS WRITER
Bud Madden fills up in Sylvania Township. Meijer is one of four chains locally that sell gasoline. Bud Madden fills up in Sylvania Township. Meijer is one of four chains locally that sell gasoline.
NORTZ / THE BLADE Enlarge | Buy This Photo

As the cost of gasoline soars - with a gallon of regular unleaded averaging $2.27 in Ohio - many consumers are turning to grocery chains to save a few pennies at the pump.

The grocers say they aren't trying to be the low-priced-gasoline leaders in the area but want to provide gas as a customer service and as a reward to shoppers.

Still, many consumers are finding that the prices of gas at the grocery chains are consistently among the lowest in the Toledo area.

An energy consulting firm in Colorado said recently that a surge in demand for cheap fuel is sending consumers to big-box retailers nationwide to save three to seven cents a gallon.

Energy Analysts International, of Westminster, Colo., predicts that grocery stores' 5.9 percent share of gas sales in 2002 will jump to 12 percent by 2008.

Rick Simon, who drives over100 miles a day, says he feels the crunch of high prices.
Rick Simon, who drives over100 miles a day, says he feels the crunch of high prices.
NORTZ / THE BLADE Enlarge | Buy This Photo

"We've been in the gas business for such a long time now that people have come to know that Meijer is going to be a penny lower or equal to the lowest prices in town," said John Zimmerman, a spokesman for Grand Rapids, Mich.-based Meijer Inc.

Customers who pay attention to pricing have noticed, especially those who spend many hours behind the wheel. "You hardly get any gas for your money anymore," Rick Simon said as he filled up recently at Meijer on Central Avenue in Sylvania Township. "I drive over 100 miles every day, so I really feel the crunch."

Yesterday, prices for gas at Sam's Club, Meijer Inc., Giant Eagle Inc., and Kroger Co. were among the six lowest in the area, according to www.toledogasprices.com, a Web site on which consumers post gas prices. Sam's Club, at $2.07 a gallon, had the second-lowest price in the area yesterday.

A Meijer program to give gas-pump discounts to frequent shoppers has been used more in the past few months, but there's no indication that other customers are using the chain's pumps more, the spokesman said.

Under the program, customers who buy specially marked items in the store receive discount coupons ranging from 25 cents to $10 toward the purchase of gas.

Giant Eagle, with two local stores, also tries to be competitively priced but not necessarily the low-priced leader, said spokesman Rob Borella. The chain provides a 3-cents-a-gallon discount for its loyalty card holders and an additional 10 cents a gallon off for every $50 spent in the grocery store. It has had steady growth in fuel sales, the spokesman said.

Sam's Club limits it gas sales to customers with club memberships. Its gas pumps do not accept cash, only credit cards and Sam's Club gift cards, but its prices are usually 3 to 7 cents a gallon lower than the average in an area.

A spokesman for Kroger said that chain also has sold steadily rising amounts of gasoline.

"If the gas is right there it's a lot easier to buy it there rather than traveling to another place or making more than one stop," said Monica Gordon. "Why waste gas driving around?"

Kroger watches the local market and tries to price its gas competitively, the spokesman said.

Low-cost providers buy unbranded gasoline from wholesalers, usually the same refineries that produce gasoline for brand-name stations.

There are some differences, however. Fuel sold by major gasoline chains usually contains more additives and other cleaners to keep a vehicle's valves and fuel injectors clean.

Gasoline sold by low-cost providers doesn't have those extras but it does meet the fuel detergent standards set by the U.S. Environmental Protection Agency in 1995.

Customers can enhance their own gasoline by buying their own additives. Mr. Borella, of Giant Eagle, said that in response to such demands from consumers, the retailer has begun selling additives and other auto supplies in its gas outlets.

Contact Jon Chavez at:

jchavez@theblade.com

or 419-724-6128.



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