TUCSON, AZ - "Across Tucson, the service-station industry is going through a shake-out," writes the Arizona Daily Star, a result the newspaper attributes to the sobering economics of fuel retailing, coupled with the arrival of QuikTrip, which opened its first area store in 2010 and now operates 12, with another three under construction.
"We're coming in with a new prototype. We never stand still. We're always looking for a way to better or enhance ourselves," said company spokesperson Mike Thornbrugh.
QuikTrip€™s innovations have enabled it to succeed during difficult times for fuel marketers. Indeed, since it arrived in town, two dozen gas stations have closed, a trend that reflects shrinking fuel margins and other industry challenges.
"It's just so competitive," said Tom Cooley, who closed his independent station last month. "People like Fry's will sell [gasoline] at about my cost on fuel. They'll give 10 cents a gallon off, and you can't compete with 'em. Circle K is building like crazy, and so is QuikTrip."
As the economy soured, land values also decreased, which made it more difficult for independent operators to obtain financing. As a result, many ended up owing far more than their properties were worth.
Additionally, the recent rise in gasoline prices has made it difficult for independent retailers to compete.
"When there's $4 per gallon fuel, people don't have disposable income they did at $2 per gallon fuel," said Troy Little, president of Tucson-based Quik Mart. "They won't come in to get that soda and a bag of Fritos."
As a result of the closures, many residents are finding vacated lots, an unfavorable aesthetic that they hope will be reversed as soon. While some said they would like to see the stations converted to other commercial uses, that seems unlikely, as the costs of removing underground storage tanks are steep.
"The preferred way for the owner is to sell it as a gas station, because in doing so he's going to sell his gas-station business," said Michael Green, a local real-estate broker who runs MJG Gas Station Specialists.