AKA: When is a discount not a discount?
AAKA: Trouble at the bowser.
Here’s another Australian word we’ve got that you haven’t. Well, you do have the word, but not in the way that we mean it here in Australia.
The word can mean a generic name for a tanker.
For most kids, and for some adults too, Bowser is the main villain in the ‘Mario’ video games. Here in Australia, it means a fuel dispenser, or in other words, a petrol pump.
There always seems to be “trouble at the bowser” here in Australia. I think it’s part of the rollercoasters price system that I explained in my original post two and a half years ago about the cost of petrol here.
This time, the trouble was that petrol became rather expensive around Christmas. But don’t worry, Coles and Woolworths to the rescue.
I’ve mentioned Coles and Woolworths before in my post called Where’s All My Money Gone? They are the two major supermarket chains here in Australia and they have both always run a promotion where, if you spend more than $30 in the store, you get 4 cents per litre off of petrol you buy from their petrol stations.
Coles has done a deal with Shell and sells petrol through Coles Express. Woolworths has an arrangement with Caltex, Australia’s leading oil refining.
Well, leading up to Christmas, a time where petrol was going to get expensive and supermarket shoppers fill their trolleys to the brim, these kindly supermarket chains increased their petrol discount to 8 cents per litre.
8 cents off! Fantastic!
Given that these two companies are major petrol retailers here in Australia, you would think they could negotiate a great deal when buying their petrol. Now they are going to give 8 cents per litre off?
Surely they would be selling the cheapest petrol in town!
Where I live, if I drive towards the city, I pass three petrol stations within just a few kilometres of each other. First I pass Caltex…..
Then I drive past a small independent petrol station run by a company called Freedom Fuels. They’ve not been going very long; according to their website they started with 11 retail sites and about 50 employees in 2000.
Today they have 57 outlets. This was the price of petrol in the one that I drive past. They don’t have 8 cent discount coupons, they don’t have any supermarkets, but they will give you a discount of four cents per litre if you put more than 40 litres in when you fill up.
- Coles $1.39.9
- Woolworths $1.39.9
- Freedom Fuels $1.30.7
Hmm. So let me get this straight. Coles/Shell and Woolworths/Caltex can’t sell petrol cheaper than a little-known independent company called Freedom Fuels, even after deducting 8 cents per litre?
Does anybody else smell a rat?
So, when is a discount not a discount?
Here’s another example so you can work out the answer to that question yourself.
The Coles Group own a couple of bottle shops, or off-licences as they are known in the UK. One is called Liquorland and the other is called 1st Choice.
1st Choice sells my wife’s favourite bottle of wine for $8, but they always give you a 5% discount if you buy six or more.
Price of wine = $7.60.
Liquorland occasionally runs a special offer giving 20% discount when you buy six bottles or more. The price of my wife’s favourite bottle of wine there is $10.
Price of wine = $8.00.
Yet, let remind you again, the Coles Group owns both of these bottle shops.
I’m pretty sure I know when the discount is not a discount, you probably do too now as well.
Petrol price comparison with the UK.
For those who like to know, the current average price of unleaded petrol in the UK is about £1.32. With the current exchange rate being around 1.51 Aussie dollars to the British pound, that means petrol in the UK is about $2 a litre. So it’s a good 50% dearer in the UK than it is here.
So, I won’t be buying my petrol from the UK, I’ll stick to Freedom Fuels.