Friends tell me that I worry to much but I can't help taking notice of thngs that go on in the world around me and then wonder why they happen!

 

OK so the latest one that's bugging me

 

When Sainsbury's announced profits yesterday and they talk about like for like sales excluding fuel (petrol) and I suddenly realised that when all supermarkets announce sales results they always exclude fuel

 

So why is that then?

 

I mean what is wrong with the fuel sales and why won't they tell you what they are - even if you were interested?

 

But they all do it..... excluding fuel.

 

I tried a google but could not come up with any obvious answer to this - is it a conspiracy lol? There are so many strange things that you hear in everyday life that don't seem to have any explanation but I don't believe anything happens by chance

 

Someone must work at a supermarket... can you answer the question?

 

Rich

From working at a Sainsburys before, the Fuel actually doesn't make money, they make more money on the sandwiches and drink at the petrol station than actual fuel

They do include fuel in the set of figures http://www.bbc.co.uk/news/business-29444904

On the matter of its own sales, Sainsbury's was on less robust ground. Like-for-like sales (actually a marker of revenue flowing through the cash tills rather than a comparison of the number of items sold) are down 2.8%.

 

Stick fuel in there, and sales are falling just over 4%.

The key performance figure for any retail shop is "like-for-like" sales: that allows for stores they open / close. In fact, if you are in retail, you'd even be looking at "sales per sq ft" (or profit) to look at the performance of every bit of your store. But "like-for-like" allows analysts / shareholders / the market to look at how this company is performing and compare that to the competition.

 

Not every Sainsbury's has a petrol station. Plus fuel is very volatile (hoho) so if the price of petrol goes up, the turnover goes up and that's got nothing to do with "how well does this company sell petrol". So if you're looking at the headline performance of a retail company, like-for-like is what you want - and if you want to know everything else including fuel, that'll be in the report somewhere.

Broken down simply -

 

Supermarkets buy their fuel from the oil majors. Who have the own petrol stations.

If they slash 10p off a litre, the supplier will put the cost up so that they don't make a loss on their customers.

They do include fuel in the set of figures http://www.bbc.co.uk/news/business-29444904

The key performance figure for any retail shop is "like-for-like" sales: that allows for stores they open / close. In fact, if you are in retail, you'd even be looking at "sales per sq ft" (or profit) to look at the performance of every bit of your store. But "like-for-like" allows analysts / shareholders / the market to look at how this company is performing and compare that to the competition.

 

Not every Sainsbury's has a petrol station. Plus fuel is very volatile (hoho) so if the price of petrol goes up, the turnover goes up and that's got nothing to do with "how well does this company sell petrol". So if you're looking at the headline performance of a retail company, like-for-like is what you want - and if you want to know everything else including fuel, that'll be in the report somewhere.

 

That's it, in a nutshell....!!

 

And fuel is a high sales value / poor profit margin product; which some supermarkets actually sell at a loss in some cases. The same will go for their banking and insurance revenues; yes they [should] add to overall profits for shareholders, but since supermarkets seem to add additional services to their repertoire each year, if each new venture performs well, it could also disguise the core business (ie the groceries) actually doing badly. So the way to analyse key performance year on year, is to exclude revenue from either newly introduced services; or services where the market is volatile and results are affected by external, unpredictable factors - like fuel, which is dependent upon taxation, the £ vs US$, war in the Middle East etc.

 

Plus the extra turnover is just vanity; if you or I went into business selling postage stamps - say you sold 2,000,000 first class stamps each year, granted you'd have a business with a £1.24m turnover (assuming you sell them at face value); but your margin would be virtually zero unless you persuaded the PO to give you a massive discount on buying them!

 

Richard:cool:

Hey there are some really clever folks on here........ :)

Hey there are some really clever folks on here........ :)

 

Are there.....?

 

.....Nobody told me that when I joined......:shifty::lol:

Are there.....?

 

.....Nobody told me that when I joined......:shifty::lol:

 

:lol::lol:

Ok so why is it that you buy any product from a shop you get a recept but when you buy fuel you have to ask for a recept anless they have already asked you.

Ok so why is it that you buy any product from a shop you get a recept but when you buy fuel you have to ask for a recept anless they have already asked you.

 

Do you? I fuel up about 3xs a week and never have to ask, sainsburys even give you a VAT without asking.

Ok so why is it that you buy any product from a shop you get a recept but when you buy fuel you have to ask for a recept anless they have already asked you.

 

because they must get 500 heads through the door aday and try keep it easier for themselves with regards to handing over 2 different pieces of till roll...one for the card payment and another for the VAT fuel records