Re:Walmart Canada stops accepting Visa cards
by ams6110 on Sunday June 12, 2016 @12:44PM
(#11888944)
This is true. Gasoline is sold with almost no profit. It's one example of a perfect competitive market converging on zero profit (at least for the retailer). Gasoline is a commodity, it's all the same and everwhere it's sold there are usually several competing retailers and prices are highly visible from the street.
[ Parent
| on HN ]
Re:Walmart Canada stops accepting Visa cards
by rubyfan on Sunday June 12, 2016 @04:20PM
(#11890044)
Yeah interesting, I wonder if there's anything remotely similar in the real world.
Re:Walmart Canada stops accepting Visa cards
by analog31 on Sunday June 12, 2016 @07:19PM
(#11890815)
I suspect it's quite common. Gas is an ideal loss leader -- the price on the sign, and your need for gas, gets you into the station. But now you're there, and you're less sensitive to the price of a Coke or bag of jerky.
But there are a lot of markets where price competition drives down the margins for the "main" product, so that the retailers make up their profits on smaller stuff. I've read that a store selling electric guitars or bicycles makes relatively little profit on those items, but instead, makes their nut on accessories, things that wear out, service, lessons, etc.