May 30, 2008

GREETINGS AND SAL-UTATIONS!

Dear NJGCA Member:

SELLING BELOW COST: IT MAY HAPPEN AND DRIVE YOU OUT OF BUSINESS!!

It’s not a joke and it’s fresh out of Trenton today!

Trenton lawmakers know that residents are unhappy about rising fuel prices.  They also know that there is no better way to win points with the public then “fixing a problem” at the expense of the business community.  Politicians are reacting excessively and are about to strike a blow to retailers everywhere.

Assemblyman John Burzichelli (D-3rd District) has submitted legislation that, “Permits retail dealers of motor fuel to sell motor fuel at a price below the net cost to retail dealer.”  Incredibly, this bill - A-2904 - would abolish trade policies that have protected consumers from overbearing trusts and greedy monopolies for decades!!

Imagine what will happen if the restrictions on below-cost selling were lifted.  Corporate owned, “big-box” gasoline retailers with 50 or 100 locations could drive the little guy out of business overnight.  These corporate-retailers would essentially take a loss at a number of locations to drive their competitors across the street out of business.  They can do this because while one location is lowering their price to undercut their rival, they can either jack up the cost at another location or absorb the loss.  This is what economies of scale can afford them.

Once their small-business competitor is gone, the prices are jacked back up and the consumer has no choice but to purchase gas from the “big box” outfit at whatever price the remaining retailers establish.  This is known as “predatory selling” and it WILL wipe out your small businesses.

Assemblyman Burzichelli has hit the airwaves claiming that he is pursuing this proposal for consumers and motorists.  He feels that, ultimately, many retailers make money only on their convenience stores or mechanic shops -- So why not allow retailers to sell at a lower price to help the public? 

The Assemblyman needs to know that in the long run his proposal will neither serve motorists nor the small-business community.  We can say with certainty that if enacted, this bill will hurt YOUR establishment.

In a state that continually seeks to pick your pocket, NJGCA has always tried to help you navigate the dreaded bureaucracy and complex regulations that government perpetuates.  Working together we have crafted a family that opposes Trenton’s policies and defends your rights as a small-business.

We now need all hands on deck to defeat this proposal!  In short, we need an army of retailers to vocally speak out against A-2904!! 

I am asking you to reach out to fellow retailers, even if they aren’t a fellow NJGCA member.  Let them know what this bill will do to gasoline-retailers collectively.  Let them know that they are just as vulnerable as you are to going down if this bill passes.  Ask them to get involved, tell them to reach out to NJGCA for more details.

Trenton has devised a number of idiotic schemes in the past to extort money from small-businesses and residents. But this is dangerous!  Assemblyman Burzichelli and Trenton lawmakers are thinking of suspending established laws that protect both businesses and consumers alike - just to say “We did something” - is simply feel good legislation.

We will continue to update you in the coming weeks as more information becomes available.

Spread the word and contact me with any questions or comments you may have.

Thanks for reading.  See you next week!

Regards,
Sal Risalvato
Executive Director

IN THIS WEEK’S NJGCA ROAD WARRIOR:

NEWS AROUND THE STATE

•Saving Taxpayer Dollars
•Lawmakers seek tax relief instead of toll-hike
•Smaller cars get big boost in the market
•Corzine Budget have new taxes, fees?

NEWS AROUND THE STATE

5/29/2008:
Saving Taxpayer Dollars
Citing the need for reform after a Keansburg school superintendent received a severance package in excess of $700,000, state officials are now seeking to limit school officials’ pay.  Such a restriction could save millions of taxpayer dollars annually.

5/29/2008:
Lawmakers seek tax relief instead of toll-hike
A group of elected officials hosted a rally in Trenton, calling on the Governor to make further budget cuts in lieu of raising tolls or increasing the gasoline tax.

5/28/2008:
Smaller cars get big boost in the market
As gasoline prices head north of $4.00 in some markets, consumers are purchasing a higher number of fuel-efficient vehicles.  The shift has caught many dealerships by surprise and customers are often waiting months for backlogged vehicle delivery.

5/21/2008:
Corzine Budget have new taxes, fees?
Governor Corzine’s promise to not include any new taxes or fees in next year’s budget is being challenged by some lawmakers and officials.  Many question if cuts in municipal aid and some programs may not amount to a tax hike on the local level.