Thais buying expensive fuel

[sitti]

So why are they buying it at the vending machine? It is obvious that they only have 10 or 20 baht available to buy fuel. That by definition means they are not flush with cash. The petrol station won't allow them to spend so little, so they use the vending machine. The company who own the vending machine know this. Why else would they place one so close to a petrol station? You don't think charging 45% more is not profiteering?

If you are starving and you only had 20 baht in your pocket but a loaf of 20 slices of bread in a shop is 50 baht but they will sell you one slice for 10 baht, what do you do? You buy the 2 slices for 20 baht of course. Now is the shop owner just having a good business opportunity or is he or she exploiting your situation?

There are plenty of vending machine located in villages far away from petrol station. It is the matter of convenient locations. The one you saw just happen to be near the petrol station.

You are now mixing up so many things. First, petrol station and vending machine are completely different. Totally different bases of comparison. Second, this is quantity based pricing. Companies own petrol stations buy petrol in very very large quantity, so naturally they get to buy at much cheaper price per litter. How much individual vending machine owner can possibly buy at once. Third, you need to consider how much profit you can actually make from each transaction since each customer only buy in very little quantity. Also don't forget the operating costs, rent for space if any, and cost of purchasing a vending machine. Demanding vending machine owners to match the price with petrol station just isn't reasonable. Lastly, this is a buisness for profit after all, not charity or non-profit organazation. Bringing up starving people isn't a fair argument, is it. It is not even relavent. Why don't you go to any bakery store and see how they all set the price. The value of whole bread is much better than what you get from buying each sliced bread. All businesses want to sell quick in larger quantity and clear the stock asap becuase there are costs. If you slowly sell your product bit by bit, that will be more costs for your business.

Now this starving person and bread example you brought up. 20 slices = 50 baht and 1 slice = 10 baht. That is 400% difference. Ok, I'll still go along with that to make my point. What if the shop has always been regularly selling each slice of bread for 10 baht, before starved poor person walked in, do you still have problem with their pricing. Even if the shop regularly sell only a bag of 20 slices, if you remove 2 slices to sell to starved person, that bag will become your loss becuase you can't sell it to regular customer with 2 missing slices. As a business, you need to sell each slice at higher price to make up loss or extra cost.

If you are running a business, you need to set the price that customers are willing to buy your products and make profit. So this self-serving small pump business is doing just fine. There are lots of customers, and owners are making profit.

[Eaglekott]

Seems like noone actually answered my questions.

Just quote my post and fill it in:

1) Why do they fill up V-Power instead of normal petrol?

2) Why do they buy the water for 10 Baht when they can buy it 15 metres away for 7 Baht?

3) Why do they (normal workers) work for 37 Baht an hour yet they go home with the motorbike taxi for 40 Baht instead of walking 15 minutes (=160 Baht/hour)?

IMHO and I speculate a bit.

1, Depends on what car you have. If you have a modern car that adjust spark timing according to the knock resist in the fuel (RON) your car actually get more powerful with better fuel and will consume less and give cleaner exhausts. On the other hand, more powerful car might make it funnier to drive in a more sporty style and you may use more fuel anyway. I would love to have the high powered (100 RON) V-Power Shell has in Europe.

2, Maybe they think the 10Baht water taste better. I usually buys Crystal 1.5L bottle for 14 Baht, even if there is another 1.5L for 11 side by side. On the other hand, at home I often drink the tap water.

3, Their legs and feet might be to tired for a 15 min walk after working 12 hours? My gf sometimes asks me to take the Car and pick her up from the BTS, 500 meters away from where we live, because she has pain in her feet and legs after standing working from 09.45 to 22.00

[impulse]

If you are running a business, you need to set the price that customers are willing to buy your products and make profit. So this self-serving small pump business is doing just fine. There are lots of customers, and owners are making profit.

I salute the Thais for coming up with these, freeing up the people who used to sit and sell fuel by the 1 liter from glass bottles. Now they can do other things and increase their earnings while the machines take care of business. Customers can get filled up even during odd hours. And the guys who build and sell the machines make money, too. Win-win-win.

Someone saw a market opportunity and came up with a solution (that probably wouldn't work under other market and regulatory conditions). Good to see it.

[wump]

Seems like noone actually answered my questions.

Just quote my post and fill it in:

1) Why do they fill up V-Power instead of normal petrol?

2) Why do they buy the water for 10 Baht when they can buy it 15 metres away for 7 Baht?

3) Why do they (normal workers) work for 37 Baht an hour yet they go home with the motorbike taxi for 40 Baht instead of walking 15 minutes (=160 Baht/hour)?

IMHO and I speculate a bit.

1, Depends on what car you have. If you have a modern car that adjust spark timing according to the knock resist in the fuel (RON) your car actually get more powerful with better fuel and will consume less and give cleaner exhausts. On the other hand, more powerful car might make it funnier to drive in a more sporty style and you may use more fuel anyway. I would love to have the high powered (100 RON) V-Power Shell has in Europe.

2, Maybe they think the 10Baht water taste better. I usually buys Crystal 1.5L bottle for 14 Baht, even if there is another 1.5L for 11 side by side. On the other hand, at home I often drink the tap water.

3, Their legs and feet might be to tired for a 15 min walk after working 12 hours? My gf sometimes asks me to take the Car and pick her up from the BTS, 500 meters away from where we live, because she has pain in her feet and legs after standing working from 09.45 to 22.00

1. I was talking about scooters. Virtually all of them run on 91 and 95 provides no real benefit.

2. The water is Nestle, same as in the minimart. I agree that more expensive water like mineral water tastes better but we're talking about the exact same brand and variety here.

3. I agree with your theory on this one however I still find it a waste to spend 15% of the day's wages on a short journey like this. If the girl was working 12 hours it would mean that she wasted nearly 2 hours of work for this if on minimum wage (yes, I know they are only supposed to work for 8 hours but even then it would be 75 minutes wasted).

[BSJ]

The owner of the petrol dispensing machine probably has to make monthy payments (the dispenser is up around 90k baht).....plus has to go to the service station to buy the benzine every 3 or 4 days. Out here in the sticks the 6 wheel fuel tankers are full of diesel, they carry no benzine. And to get the benzine to fill up the tank of the dispenser the local guy has an 18km round trip.

You need to factor in the costs before you poo poo the guy who is supplying the service.

[Daffy D]

Are you sure the machine was selling 95 gasohol?

Many of the old motorbikes don't run well on this, they need 95 Gasoline. (old fashioned petrol/gas)

Very few garages sell Gasoline now so it may be more than a few meters ride to a service station that has it.

[stevenl]

All these machines are selling 95 gasohol.

[wump]

Are you sure the machine was selling 95 gasohol?

Many of the old motorbikes don't run well on this, they need 95 Gasoline. (old fashioned petrol/gas)

Very few garages sell Gasoline now so it may be more than a few meters ride to a service station that has it.

Not true... even some sh1tty old Wave has a 91 Gasohol sticker on it. Even if there would be some higher CC bikes that required 95 you could still fill in Gasohol 95 cause the 10% Ethanol virtually makes no differnce. Apart from PTT I don't think there is many Gas Stations still sellling Benzene 95.

[Daffy D]

My wife who has as a 10 year old Fino says she notices the difference when it runs on Gasohol so every few tankful's she fills with 95 Gasoline.

The nearest station to us is about 10 kliks away and about every month or so I fetch a 5lt can full for her.