The history of the Wisconsin-based Woodman’s Markets is the embodiment of the American dream.
The company began in 1919 when founder John Woodman opened a simple produce stand on the corner of Milton and Sherman Avenues in Janesville, Wisconsin.
Two years later, Woodman’s son joined the business and together they moved the produce stand into a 580-square-foot storefront.
Over the years the family continued to grow Woodman’s Markets, opening one store after another.
Today the company operates 19 stores in Wisconsin and northern Illinois, employs more than 2,200 people, and brings in annual revenue of more than $2 billion.
Part of Woodman’s success is the company’s prices. Woodman’s uses a bulk purchasing and shelving model, which allows it to have lower prices than many of the larger national grocery store chains. That’s great for customers. But it doesn’t always sit well with surrounding businesses.
According to a report from local Milwaukee news station WISN 12, the owners of two local gas stations are suing Woodman’s for selling cheap gasoline.
The companies operating the BP and Shell stations near a location in Waukesha, WI, claim that Woodman’s is breaking the law. They say Woodman’s is violating the Wisconsin state’s Unfair Sales Act, which prohibits companies from selling goods below cost.
The owners of the BP and Shell stations want $80,000 each, based on the number of days they say Woodman’s illegally outpriced them.
A look at Gasbuddy.com shows Woodman’s selling regular gasoline for $3.69 a gallon as of April 5. Other stations in the area, including the BP and Shell, were charging $3.79 to $3.84 per gallon.
Many people, including yours truly, immediately want to defend Woodman’s right to price gasoline at whatever they want. It’s its own business, it should be allowed to do what it wants with it. But we should consider there are good reasons why unfair trade laws exist.
The specific Wisconsin Unfair Sales Act in question, for example, states that “the practice of selling… below cost to attract patronage is a form of deceptive advertising and an unfair method of competition in commerce…”
It’s intended to protect consumers, as much as it is to protect businesses.
Regardless of whether the lawsuit is successful or not for these two gas stations, however, it’s very bad PR for both BP and Shell — especially since they’re both heading to Washington today to testify before Congress about the rising cost of gasoline.
Today executives from six of the nation’s largest oil companies will speak before the House Energy and Commerce Oversight and Investigations subcommittee, which oversees the nation’s fossil fuel industry.
Among the executives testifying today are David Lawler, Chairman and President of BP America, and Gretchen Watkins, President of Shell USA.
And they’re going to get grilled.
U.S. Representative Diana DeGette, who serves as chair of the subcommittee, released a recent statement, saying:
Americans across the country are suffering from the skyrocketing cost of gasoline, while some of the nation’s largest oil companies are reporting record-high profits. We will not sit back and allow the fossil fuel industry to take advantage of the American people and gouge them at the pump. We want to know what’s causing these record-high prices and what needs to be done to bring them down immediately.
Of course, the BP and Shell stations suing the Woodman’s in Wisconsin are franchises, and the corporate BP and Shell companies have nothing to with the lawsuit. But it’s still very bad PR for both companies
These lawsuits are bad PR for the U.S. oil industry generally. And with today’s cancel culture, bad PR can cost companies millions of dollars.
As I mentioned to you last week, the Biden administration and mainstream media are pushing a message that the U.S. oil industry isn’t doing enough to help the American people. But the truth is, there is really very little the U.S. oil and gas industry can do now to ease prices in the short-term.
There is, however, one country that can do something: Argentina.
For the past several years, Argentina has been rapidly developing its shale oil and gas resources. It has been a long and difficult process, and with oil prices trading at around $60 per barrel pre-COVID, the world hasn’t really needed Argentina’s shale resources. But now with crude prices back over $100 per barrel, Argentina is positioned to become a major exporter of oil and gas from shale.
And it’s all due to a massive oil and gas basin that contains trillions of dollars’ worth of shale reserves. It’s the second-largest shale gas reserve in the world and the fourth-largest shale-oil reserve.
I’ve recently put together a report that details these shale resources in the South American country and shows how investors can get a piece of Argentine shale before the rest of the market learns about it. Click here to get access to that report.
