All about rural gas stationsI think a lot of investors, most of who live in big cities, don't understand the advantages of Parkland's strategy in focusing on rural areas, so let me explain:
I live in a rural area near Powell River, B.C. and heat my home with a combination of a wood stove and a propane furnace. I use a couple of 100lb tanks of propane per year and I take them down to my local, Parkland owned, Columbia Fuels outlet to be filled up.
Over the last two years, the cost of filling a propane cylinder has been exactly the same:
20lb cylinder = $20
30lb cylinder = $30
100lb cylinder = $95
It hasn't mattered if the price of propane has gone up or down. Apparently they just like to keep the math simple. Obviously they enjoy a rather high margin, and, being in a rural location, enjoy a natural monopoly.
This is why I like to own lots of PKI units, Whenever I get those cylinders filled up, well, I just chuckle.