SOPUS Products to go up 5%

[JHZR2]

Businesses raise prices. That's one way that they boost their bottom line, assuming demand is sufficient.

Commodity cost of oil is one factor, but far from the only one. Specialty chemicals could factor in, as does the fact that SOPUS has to pay additional OASDI on another $10k or so/yr of some of their employees... on top of health insurance and whatever else, that all gets blended (ha, ha) into the pricing strategy...

 

[Triple_Se7en]

Correct! So essentially, it's two price raises, one wholesale - then retail price jump follows.

Retailers always add an increase of their own.... on-top of the wholesaler, for profit margin stability.

 

[cmhj]

Anyone that ran a business will see no problem.

 

[dlundblad]

I don't see an issue.

For me at least, conventional SOPUS products, QSGB especially, are some of the cheapest name brand oils out there. When I joined this site, PYB was $16.50 per 5 quart jug at Walmart. Now it's just under $14...

I am betting Walmart will keep their synthetics around the same price as everyone else while offering roll-backs at different times of the year.

I do wish they'd step up their 5w40 Euro game a bit. 5 quart jugs at Walmart would be nice..

 

[fdcg27]

In a retail world of constant store deals, sales and MIRs, a 5% price increase has no meaning.
5% of what?
The big volume retailers will just say no to any wholesale price increase and will remind SOPUS that CP and Chevron would love to have more shelf facings.
The only increases would come at the distributor level and even there, other blenders will be aggressive in offering their products.
My prediction is no price increase anyone will actually see.
A trial balloon floated by SOPUS destined to be shot full of holes and nothing more.

 

[crazyoildude]

There is no need to pay extra for an oil when the others are pretty much the same give or take. You pay for the advertising.. Buy the cheapest oil with the specs you need. There is no best oil. Period!

 

[53' Stude]

Yeah, but you're using Mobil 1 :^)

 

[Farmer]

Seems like a few months ago he was a XOM rep, now hes endorsing anything that meets spec. New year new COD.

 

[Solarent]

Originally Posted By: fdcg27
In a retail world of constant store deals, sales and MIRs, a 5% price increase has no meaning.
5% of what?
The big volume retailers will just say no to any wholesale price increase and will remind SOPUS that CP and Chevron would love to have more shelf facings.
The only increases would come at the distributor level and even there, other blenders will be aggressive in offering their products.
My prediction is no price increase anyone will actually see.
A trial balloon floated by SOPUS destined to be shot full of holes and nothing more.


It's actually more likely that in a big box relationship the pricing increases is based on some kind of external indices. I see that often in larger volume supply contracts.

 

[fdcg27]

This makes sense.
However, in this country you're really talking about but one big box retailer, and they are a huge company that dwarfs RDS in annual revenues with vast reach in many countries, just like RDS.
Not entirely sure that the SOPUS unit could make any price increase stick with the Walton family store and all of the smaller regional big box retailers will likely be able to get similar deals.
OTOH, they could always reduce the generous shelf facing SOPUS products enjoy.
Price increases are never easily put across, and not too many retailers are going to accept the deus ex machina of some external index forcing a price increase without serious pushback.
I'm guessing that retail motor oil sales must be highly profitable for blenders, or they would not otherwise bother.

 

[4ever4d]

In talking about WM pricing, i will agree the effect will be minimal. OTOH parts stores are already too expensive on there oils so a 5% increase would be significant IMO.

 

[MolaKule]

Originally Posted By: JHZR2
Businesses raise prices. That's one way that they boost their bottom line, assuming demand is sufficient.

Commodity cost of oil is one factor, but far from the only one. Specialty chemicals could factor in, as does the fact that SOPUS has to pay additional OASDI on another $10k or so/yr of some of their employees... on top of health insurance and whatever else, that all gets blended (ha, ha) into the pricing strategy...


It is true that businesses have to raise prices sometimes and pass costs on to the consumers.

So if one does not feel they are justified in paying those higher prices, there are lower priced oils such as WPP's Mag1 and other 'sleepers" out there that can fill the void.

In my research on various commodities, and in no way want to make this response political, I have discovered that various government environmental regulations have driven up prices on many commodities, and I seriously doubt that the majority of these regulations have anything to do with scientific facts.

So when one considers price increases, please look at the underlying driver(s).

 

[KevinP]

You don't have to worry because we have this thing called "the free market". That means that if you want to buy my chicken you and I can agree on a price and if we agree..... the chicken is sold. The price is "fair" because there are plenty of people who want chickens and plenty of people selling chickens. If I value my chicken too highly you are free to walk away.

Conversely, single supplier markets eventually become unbalanced and unfair. Government run markets by nature eliminate all competition and dictate prices. They sometimes favor a producer and sometimes a consumer but the direction they lean depends upon political influence, not on how the consumer or supplier value their goods and services.

P.S. Long-term inflation rate in the US is approximately 3.7% so companies have to increase prices by that amount annually just to keep prices the same.

 

[fdcg27]

Where are you getting this 3.7% USD inflation rate from?
I suppose that if you average things going back to the very high inflation rates of the seventies, then you might get there.
USD inflation over the past eight years has averaged closer to 0.0% than anything like 3.7%.
Deflation remains a real concern.

 

[dlundblad]

My original statement still stands.

At Walmart, PYB is cheaper now than it was 3.5 years ago.

What the problem is?

 

[veryHeavy]

Originally Posted By: fdcg27
Where are you getting this 3.7% USD inflation rate from?

There's multiple ways of calculating inflation, depending on what you track (include food, or exclude food) (include gas, or exclude gas) (etc). This website uses the formulas originally used during the Reagan and Carter administrations. The old formulas produce higher inflation numbers:
http://www.shadowstats.com/alternate_data/inflation-charts

 

[Garak]

Originally Posted By: dlundblad
At Walmart, PYB is cheaper now than it was 3.5 years ago.

Our regular prices have gone up, but despite that, the rollbacks are deeper than in recent memory, even with our dollar taking a hit. I had better not say that too loud, though.

 

[MoparMan1891]

Where do you all find the Pennzoil rebates? On their website, it says the $2/quart rebate ended 12/30/2016.

I'd love to invest in the PUP for my next oil change, but.............. Can't find it ever! lol.