September 14, 2012

Dear NJGCA Member:

Thank you for reading this week's NJGCA Road Warrior!

CLASSIFIEDS!
•Do YOU have equipment for sale or are you looking for a new employee?!

NEWS AROUND THE STATE
•NYC Board of Public Health officially bans sugary drinks
•State Senate President seeks new tax credits for small businesses
•Revamped teacher evaluations to expand in New Jersey
•U.S. Labor Department reports August job numbers

STANDING UP TO BIG OIL
STANDING UP FOR YOURSELF
LUKOIL PROTESTORS, TAKE A BOW!
NON-LUKOIL DEALERS, TAKE NOTES!
LUKOIL DEALERS POST $9 FOR A GALLON OF GAS
PENNSYVANIA DEALERS JOIN WITH NJ DEALERS
WE MAY TARGET YOUR SUPPPLIER NEXT!

Each week, when I sit down at my desk to write the latest Road Warrior communication, I typically have to think about what I want to say and how I want to say it. Usually I have a bit of a sit-down with our staff to compare notes on what’s going on in Trenton, the market, the media, or the economy. Other times I’m on the phone with authorities in Trenton or conversing with elected officials to get their take on something.

The point is, it just doesn’t “happen” without some effort, and it has to be worked on.

Of course, this past week wasn’t anything like a typical week. There was no sit-down. I didn’t make any phone calls. And this installment of the Road Warrior really did just “happen” on it’s own with little effort.

With the exception of the crew manning the International Space Station, and perhaps a few souls wandering around Antarctica, I think just about everyone out there has seen the coverage of our LUKOIL protest this week. And that isn’t arrogance talking. All day Wednesday, NJGCA got phone calls and press coverage from the Northeast, California, Moscow, London, and beyond! If you don’t believe me, check out a few of them for yourself:

And that’s only a few of them. Though we are working to chronicle all the articles, video clips, and radio segments the press conference produced, you can see how extensive the coverage was yourself by just doing a general internet search for “LUKOIL” and “NJGCA”.

You’d think that with that kind of press, I’d be crowing like a rooster and making all kinds of noise post-protest --- but I’m not and I won’t. While I’m overjoyed that the press conference was successful, and more proud than I can tell you of the dealers that participated, now is not the time for bravado or bragging.

Rather, now should be the time to reflect on what urged us to act and how our message has been perceived.

Wednesday’s event was, by all accounts, a great first step in helping bring these unique problems to the public’s attention. Our press conference focused on the uncompetitive prices LUKOIL continues to charge LUKOIL lessee dealers. That’s a fact; not an accusation. The NJGCA staff has been diligently collecting information from various LUKOIL lessees. We’ve taken these raw figures, and then compared them to general market conditions. When we crunch those numbers on a graph, it illustrates what we already suspected -- That even to the most casual observer, the high DTW prices are unjustifiable!

Sadly, what those numbers cannot tell us is how they’ve driven away countless customers that these entrepreneurs depend on to survive. Even if I don’t have a graph to show it, that is also a fact.

The financial plight of these small business owners and their customers took center stage on Wednesday. We heard from LUKOIL franchisees such as Khalid Zackria, Roger Verma, Ameer Krass, Vinnie Bagdwal, Kashmir Gill, and others who talked about their negative experiences with LUKOIL and their tactics. I have estimated that at least 30 dealers have turned their keys into LUKOIL because they were hemorrhaging money and couldn’t keep their doors open any longer. I suspect that another dozen or so maybe headed in the same direction by the end of the year if this keeps up. As of right now, I know for a fact that one dealer I alluded to on Wednesday is waiting until the end of the month to turn his keys into LUKOIL. Why? Because he’s been losing $4,000 each month and his savings are all gone.

LUKOIL lessees gathered in protest during the press conference on Wednesday.

Executive Director, Sal Risalvato, and assembled LUKOIL protestors address the media during the press event.

NJGCA Vice President and LUKOIL lessee, Kashmir Gill, addresses reporters.

LUKOIL lessee and NJGCA Member, Ameer Krass, speaking to reporters during Wednesday's press conference.

LUKOIL protest participants displayed a sign explaining to customers the reason behind the price hike and asking them to call LUKOIL!

Street sign as seen from Stelton Road in South Plainfield during the LUKOIL protest.

Unfortunately, what didn’t get as much attention from reporters was that this wasn’t just about gasoline delivery prices. LUKOIL’s treatment of these lessees also extends to peripheral issues, such as lack of responsiveness to poor curb image, maintenance problems, very high station rents, and how this inattentiveness is negatively impacting the LUKOIL image among motorists.

Let me give you a real-world example of this. Khalid Zackria hosted our press conference on Wednesday. Khalid’s location was a former Mobil franchise in South Plainfield. In 2003, Khalid’s location was a branded Mobil location and was selling nearly 500,000 gallons of fuel a month while purchasing gasoline at justifiably competitive market prices. Khalid purchased the franchise in 2005. Since then his volume has dwindled to 70,000 gallons a month. What changed? Quite a lot! Khalid’s location was forced to switch to the LUKOIL banner when that location was divested as part of Exxon’s merger with Mobil. He stopped operating under the Mobil brand and started selling under the LUKOIL flag. With that came new management – and their tactics.

Some commentators and pundits – as well as our opponents in the wider court of public opinion – will dismiss what we did this week as some sort of a charade. They’ll say we’re gouging customers or trying to hurt motorists. While I can’t help what uninformed folks will say, I can try to educate them.

LUKOIL protestors weren’t gouging anyone because gouging can only happen when an emergency exists, fuel inventories are restricted, and customers have no choice but to buy from you. If gasoline supplies are plentiful (as they currently are) and the government hasn’t declared an emergency (it didn’t) it cannot be gouging. All these franchisees did was adopt what LUKOIL North America does to them with each tanker delivery, but turned up the dial a few notches: They priced themselves out of competition!

The LUKOIL protestors also weren’t trying to hurt customers because every motorist can see the sign from the street and have a choice on where to fill up each day. What’s more, every station attendant was ready to point out the price and hand the customer a flyer to explain why they were protesting with high prices. Sadly, unlike the average driver, these LUKOIL franchisees do not have the same choice and are locked into a supplier contract they cannot escape from – even when they get overcharged for the same fuel that a competitor gets down the street for less money.

No, don’t let the pundits and talking heads distract you.

When LUKOIL (unjustifiably) overcharges for gasoline, they’re driving away customers – and undermining a small business owner, his customers, and his employees. LUKOIL themselves know that this isn’t defensible. In fact, when CBS3 in Philadelphia reached out to LUKOIL North America on Wednesday, reporters were told that they weren’t taking any calls.

Though I hope that this gets resolved soon, it’s likely that we will have to do this again in order for LUKOIL North America (and their corporate parent in Russia) to understand that franchisees are not expendable figures on a financial statement. That may take some doing.

Ultimately, Wednesday was all about a group of Davids staring down a Goliath. I’m proud of all of these dealers for standing up for themselves - and you should be too!

I know that there are other suppliers out there that have the same poor practices and treat their dealers badly. I have my eye on them.

Thanks for listening – See you next week.

After running an ad in the Road Warrior over the last month, NJGCA was able to assist a member in selling his equipment!

If you'd like to list equipment for sale, or have an open position you'd like to make other industry professionals aware of, please contact NJGCA at 973-376-0066 and let us help you get the word out!

9/13/2012:
NYC Board of Public Health officially bans sugary drinks
In an effort to combat obesity, officials in New York City have banned sugary beverages in from select eateries, concession stands, and other locations. The controversial measure, proposed by Mayor Mike Bloomberg, would place a 16-ounce limit on sweetened beverages. Though this measure would affect only New York City, some public health officials and lawmakers could be enticed to consider a similar ban in New Jersey, which could negatively affect convenience stores and other establishments. Click above to read more.

9/12/2012:
State Senate President seeks new tax credits for small businesses
With the state’s unemployment rate stubbornly high, Senate President Steve Sweeny has proposed a tax credit for employers who hire new workers. The program would refund small businesses who hire workers who have been out of work for a month. Click above to read more.

9/10/2012:
Revamped teacher evaluations to expand in New Jersey
A new law signed last month to revise teacher evaluations and tenure laws is now starting to be implemented in Garden State school districts. District officials must now determine criteria for how teachers should be evaluated, including how much standardized tests should count toward instructor performance. A string of bad evaluations could result in teachers losing their tenure. Click above to read the full article.

9/7/2012:
U.S. Labor Department reports August job numbers
Federal labor authorities report that August job growth was slow, adding 103,000 new private sector jobs to the economy. The national unemployment rate is now 8.1 percent, as job numbers from July and June were revised downward to reflect 41,000 fewer jobs than originally reported. Average monthly job numbers for 2012 still lag behind 2011. Click above for full details.

TRAINING CLASSES!!
-ALL CLASSES WILL BE HELD AT NJGCA HEADQUARTERS-
66 Morris Avenue - Springfield, NJ 07081 (Union County)

PLEASE NOTE: FUTURE DATES WILL BE ADDED UPON REQUEST AND ACCORDING TO DEMAND. CONTACT DEBBIE at 973-376-0066 or DEBBIE@NJGCA.ORG TO LET HER KNOW YOU ARE INTERESTED IN TAKING A SPECIFIC CLASS. THIS WILL ALLOW US TO GAUGE YOUR NEEDS AND KEEP TRACK OF THOSE WISHING TO PARTICIPATE!!

We have had a number of NJGCA members successfully reduce their rate per kWh signing up through our energy saving program. We know it’s difficult to collect 12 months worth of previous electric bills to get an “accurate” analysis when comparing a variable rate to a fixed rate, but we now have another option available.

This new solution is a power purchase option; the other program is still in full force and has saved members thousands of dollars. If you sign up for the power purchase option, you will be grouped with other NJGCA members until the minimum KW demand is acquired. By pooling the member’s usage together, you will be able to take advantage, as large energy users do, and receive a lower kWh rate.

Each member will receive their own contract. Each member is responsible to sign and return the agreement the day it is received in order to secure the price for their group.

Please do your due diligence, so when you receive the proposal and the agreement you will be able to make an intelligent decision.

If by chance, you still want us to assess you bills, to give you a price to compare, we will require12 months of your most recent utility bills.

There are no bills required, but we would still like to have one bill per meter on file to check account #’s, meter #’s service addresses and other pertinent information incase there is a problem.

The term of the agreement is for 12 months. During this term period, you will have price protection against any energy price increases along with a low fixed kWh rate.

If you are interested in becoming part of this power purchase option, please contact Greg Cannon at the NJGCA.

Remember when you sign up your energy through the NJGCA Energy Program, TMP makes a considerable donation to the NJGCA Scholarship Fund through their proceeds. This has no affect on your rate, and costs you nothing out of pocket.

We hope to help hundreds of NJGCA members reduce their utility costs by participating in this and our other cost reduction programs. Our purpose, in the endeavor, is to help NJGCA members lower their energy costs while supporting the NJGCA Scholarship Fund.

Contact GREG CANNON at 973-376-0066 or email Greg at greg@njgca.org. Mention that you are interested in saving money on your energy bills. NJGCA & TMP Energy Solutions will handle all the rest.

POLITICAL PARTICIPATON: THE NJGCA PAC

DEFENDING OUR MEMBERS.
PROTECTING YOUR INTERESTS.
ANSWER THE CALL & CONTRIBUTE TODAY!!

Promoting our agenda in Trenton is of utmost importance to NJGCA and our members.

However, in order to truly affect the debate, we must ensure our friends in the Legislature are re-elected. It is for this reason that your Association has established the NJGCA PAC.

For too long, the weight of funding our Political Action Committee, the arm of the Association responsible for political donations, has rested upon a few. This is not only unfair to those few members who have shouldered this burden, but means we are not utilizing our full strength to affect the debate in Trenton.

To truly understand the importance of supporting our allies, consider our successes in Trenton:

We defeated BELOW COST SELLING
We made history in getting FIRST RIGHT OF REFUSAL signed into law!
We have built large support for RIGHT TO REPAIR and got it passed out of the Assembly
We defended your small business against the false accusations of Attorney General Anne Milgram
We gained wide support to move New Jersey to an all PIF Inspection System and close the CIF lanes
...and MUCH MORE!!

In each instance, we achieved these goals with the help of our friends in the Legislature!
If every member contributes just $100.00 we will be able to provide the help necessary to ensure victory for our allies.

PLEASE SEND YOUR CONTRIBUTIONS TO:
NJGCA PAC
66 Morris Avenue
Springfield, NJ 07081
Please make your donation payable to NJGCA PAC

I understand that times are tough for all NJGCA members, but this is just as important as any battle we have fought in the past.

We have made great progress in Trenton. I hope that you will answer the call. ?

THE MEMBER TOOL BOX

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