Coin Machine Review (& Pacific ...)

Gas Stations as Locations
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A TRADE STUDY -
In its monthly reports on retail trade
over the country, the U. S. Department of
Commerce calls them filling stations. In
its booklet for veterans, on how to get into
the business, the Department calls them
service stations. In THE REVIEW Chart of
T ,ocations they are called gas stations.
A government report says the gas station
has advanced in 25 years from chiefly an
adjunct to some other business to be a re-
tail business in its own name. Modern sta-
tions are becoming more and more impor-
tant as outlets for a variety of merchandise
and services.
Gas stations have been recognized as ac-
ceptable locations for several types of coin ·
machines for a number of years, depending
on the space and a number of other fac-
tors. They are not the most important type
of location for machines but they are in-
creasing in favor as the modernization trend
spreads in the station field.
In a check of a group of REVIEW read-
ers, one operator who had only music ma-
chines reported having a few gas stations
as locations. Due to the fact that operators
sometimes class motels, drive-ins and high-
way eating places that sell gas, as gas sta-
tions, it is not easy to make an accurate
check on this point.
Among a group of operators who have
both music and amusement machines, 55
per cent had some machines in gas stations.
Among the total number of locations of all
types reported by the group, gas stations
made up about 10 per cent of the total.
Among a group of operators who had vend-
ing machines only, 60 per cent of them re-
ported having some machines in gas sta-
tions. Among all the types of locations re-
ported by this group, gas stations made up
about 6.3 per cent of the total.
The vending machine operators' surveyed
included only one large firm, the rest being
individual operators of candy, cigarette and
bulk vendors. Some of the most conspicu-
ous expansions into the gas station field
have been made by large operating firms.
On a numerical basis in the United
States, gas stations rank fourth among the
35 or more types of locations generally
known to the coin machine trade. In nu-
merical order, the locations rank as, 1.
Apartment buildings, 2. Grocery stores, 3.
Restaurants, and 4. Gas stations. In these
four types of locations there are some so
very small that they cannot be considered
as profitable for coin machines of any type.
But on the basis of total numbers, the above
rank is based on official statistics.
In January 1947 the total number of gas
stations was · generally given as 205,000,
but the official report for 1939 showed a
total of 241,858 stations. The war is said
to have decreased the total number by
about 25 per cent, an official tabulation
for 1944 giving the total as 172,700.
The postwar trend revealed a decided
spurt upward in 1946, as veterans began
to open stations, but this movement is said
to have slowed down to some extent. At
its annual meeting in December last, the
National Congress of Petroleum Retailers
reported the total number of retail gas sta-
tions to be about 225,000. This figure
'would suggest a gain of about 20,000 sta-
tions for the year 1947, although the J anll-
ary and December figures were reported by
two different sources.
Stations Va ry
Operators will consider gas stations as
prospective locations on basis of accessibil-
ity and also on basis of traffic or business
done. Gas stations vary from the small
cross-roads grocery that may have one or
two gas pumps to the syndicate establish-
ments that cost thousands of dollars. The
Saturday Evening Post recently reported a
super station near Los Angeles that cost a
million dollars to build. Government bu-
reaus usually group stations on basis of an-
nual sales into two groups, those having
annual sales of less than $20,000 and those
having annual sales above $20,000. Of the
231,000 individually operated stations re-
ported by the government in 1939, a total
of 201,000 had annual sales of $20,000 or
less.
The national average of sales in 1939
was $11,670 annually, while for 1946 the
average annual sales was running ahout
$18,000. Statistics are not available to show
at what annual sales level a station becomes
a profitable location for coin machines.
Bulk vendors are placed in small stations in
some areas and games may be used to help
pay the overhead on small stations also, by
catering to habitual players.
Before the war, more than half of the
individually operated stations were located
in or near towns having a population of
2,500 or less, or on the highways. Annual
sales of these stations averaged about
$7,433, but some highway stations do a tre-
mendous business.
As to ownership, stations are classed as
either individually operated, or as a chain
system. During the recent scarcity of gaso-
line, independents have complained much
that chain or syndicate systems had an
advantage in getting supplies of gas. The
large operating firms usually have the ad-
vantage in placing coin machines, in most
all cases vendors, in the large chain systems.
Individual operators of machines naturally
gain most by catering to individually owned
stations.
There are some chains that are national
in scope but the majority are probably COIl-
fined to city trading areas. An oil trade
paper reports on a locally owned chain in
Buffalo which now operates 44 stations in
the city, and plans to build 2e new stations
as fast as conditions permit. Similar opera-
tions can be found in many cities over the
country.
When an attempt is made to classify gas
stations so that operators could decide on
which would be suitable for some type of
coin machine, it is found that endless varia-
tions exist in the thousands of stations in
all parts of the country. Even climate has
much to do with the type of machine that
may do best in a gas station, as shown by
the competition in placing soft drink ven-
dors over the South during the summer of
1947.
A book could be written on the variations
in types of gas stations, in different sections
of the country, and the setup and type of
business they do. The chain systems of
stations, and the large operating firms that
seek this type of station, have worked out
checking systems and also plan more on
vending machines in postwar merchandising
plans.
The individual operator who works in a
limited territory can find no better rule
than to study each station in his territory
and make actual tests of different types of
machines_ The one thing he needs to keep
in mind is that a new postwar expansion
in the gas station field is under way, al-
though delayed by construction problems,
and that . gas stations will use more coin
machines than ever and become more im-
portant for coin machines.
What Machine s?
As suggested, the best thing the indi-
vidual operator can do in his territory is to
work out a plan to test stations and also
types of machines that make a profit in
them, guided by his own knowledge of his
territory. Past history also offers a lot of
experience to guide in types of machines
for stations, keeping in mind that times are
changing fast in the postwar period.
1. The summer of 1947 indicated that the
emphasis is on soft drink vendors, of the
bottle type, the movement being pushed by
competition among the major manufacturers
of soft drinks to get outlets for their brands.
The use of manual coolers for several
years before the war, at gas stations, had
shown the value of the outlets for drinks,
and had created a ready-made market for
the vendors. The rush to get out the vendors
was in the southern half of the country last
year, and will be repeated during 1948.
Here, climate is proving a big factor be-
cause of the much longer outdoor season.
The success of soft drink vendors in gas
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