There sure are alot of misconceptions of how the propane industry works. I work for a fairly large propane-oil company and we own a fleet of tractor trailer transports. So with that said and not going into numbers I can tell you that it cost alot more money than people think just to have the business. We only make a small profit on a averge winter. As far as prebuy goes we can't prebuy in the same sensce as we offer our customers. We can only buy 50% of the gas that we think we will need. The other 50% (or more if we guessed wrong) is at the current rack price the second the transport hits the load button at the loading rack. So when we offer our prebuy the customers have all winter to pay us. We have 10 days to pay in cash. SO with every prebuy cust. we are sticking our company on the line. What if gas went to $4 or $5? We still have to buy the other 50% at that price and the prebuy cust. will stay at $2.50 (or what ever there company lock them in at). We also offer a capped price which is .20 more than prebuy because that is what it cost us. But the capped price goes with the market. If gas goes down so does there price If gas goes up they will not go over the cap which would be $2.70. So our comapany anyway lets our customers make the choice of what gamble they want to take. We are very honest about pricing and let our customers make there own decissions about what they think the market will do. I hope this helps some people understand a little better and I really can't get into specific numbers about the cost of doing business, but how much of a markup over wholesale price do you folks think is reasonable?
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Today's Featured Article - Grain Threshing in the Early 40's - by Jerry D. Coleman. How many of you can sit there and say that you have plowed with a mule? Well I would say not many, but maybe a few. This story is about the day my Grandfather Brown (true name) decided along with my parents to purchase a new Ford tractor. It wasn't really new except to us. The year was about 1967 and my father found a good used Ford 601 tractor to use on the farm instead of "Bob", our old mule. Now my grandfather had had this mule since the mid 40's and he was getting some age on him. S
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