Platolene 500 Inc. Pulls Out of Illinois
TERRE HAUTE, Ind. -- Platolene 500 Inc.'s three-generation relationship with Illinois is about to come to an end. The firm, once based in Carmi, Ill., but more recently headquartered in Terre Haute, Ind., is selling its Carmi location and nine others in Illinois.
"Platolene 500 Inc. has entered into an agreement to sell our 10 Illinois convenience stores to Niebrugge Oil Co.," Henry T. Smith, Platolene's general manager, wrote in a letter obtained by the Carmi (Ill.) Times to the company's customers July 16.
"July 23 will be the last day Platolene 500 credit cards will be taken at the Illinois locations," said Smith. "There will be no way to accept Platolene 500 credit cards at any of the Illinois locations since ownership is changing."
Niebrugge Oil, based in Effingham, Ill., will continue to operate at the 10 500 Express convenience stores, "but it will be under their name and brand," Smith said.
The deal's closing will be concluded over the next three weeks, Smith said. Platolene will retain its operations in New Harmony, Ind., Mt. Vernon, Ind., Terre Haute and Sullivan, Ind., as well as Henderson, Ky., he said.
The decision to sell the Illinois stores was an economic one, Smith said. "Competition, EPA regulations, the economy ... there were so many factors. We kept adding up the numbers, and they weren't adding up right."
Increased competition for gasoline business has hurt, Smith said. A location that is forced to sell gasoline below cost to match the competition can't recoup the loss on items such as 69-cent candy bars sold inside, he said. And he added that, unlike the giant retailers, a small firm like Platolene can't use low-cost gasoline as a "loss leader" and make up the loss through the sale of other merchandise.
"It's the nature of the beast. You either go or grow in the convenience store business, and we decided to go. We've been in the business for 45 years. It's been good, but we reached a turning point," he said, adding that the firm is "changing direction" a bit to focus on other aspects of its holdings.
Smith added that since Platolene moved its headquarters from rural Carmi to Terre Haute, Ind. in 2000, "It's been more and more difficult to keep tabs on the stores, the competition and the gasoline prices."
Smith said Niebrugge Oil Co. is similar to Platolene, an independent oil company with some branded sites. It will have about 30 stores in Illinois when the Platolene locations are absorbed, he added.
Giving up the stores was a difficult decision for Smith. "I'm the third generation of our family to be involved in the operations of Platolene," he said. "It's been difficult for me to be the one presiding over the liquidation of several stores. I have thought a lot about it, had a lot of heartache over it."
His great-grandfather, Henry Smith, and C.F. "Bud" Rebstock of Carmi were instrumental in forming Platolene 500 about 45 years ago, Smith said.
Smith dropped "Platolene" as a brand a few years ago in order to update the company's retailing image, converting it to "500 Express." "We really appreciate the loyalty that our customers have given us," he said. "It was a difficult decision for us. In life there comes a time when all must change, for better or worse. We have other businesses with an interest in, and we'll turn our focus more on that."
"Platolene 500 Inc. has entered into an agreement to sell our 10 Illinois convenience stores to Niebrugge Oil Co.," Henry T. Smith, Platolene's general manager, wrote in a letter obtained by the Carmi (Ill.) Times to the company's customers July 16.
"July 23 will be the last day Platolene 500 credit cards will be taken at the Illinois locations," said Smith. "There will be no way to accept Platolene 500 credit cards at any of the Illinois locations since ownership is changing."
Niebrugge Oil, based in Effingham, Ill., will continue to operate at the 10 500 Express convenience stores, "but it will be under their name and brand," Smith said.
The deal's closing will be concluded over the next three weeks, Smith said. Platolene will retain its operations in New Harmony, Ind., Mt. Vernon, Ind., Terre Haute and Sullivan, Ind., as well as Henderson, Ky., he said.
The decision to sell the Illinois stores was an economic one, Smith said. "Competition, EPA regulations, the economy ... there were so many factors. We kept adding up the numbers, and they weren't adding up right."
Increased competition for gasoline business has hurt, Smith said. A location that is forced to sell gasoline below cost to match the competition can't recoup the loss on items such as 69-cent candy bars sold inside, he said. And he added that, unlike the giant retailers, a small firm like Platolene can't use low-cost gasoline as a "loss leader" and make up the loss through the sale of other merchandise.
"It's the nature of the beast. You either go or grow in the convenience store business, and we decided to go. We've been in the business for 45 years. It's been good, but we reached a turning point," he said, adding that the firm is "changing direction" a bit to focus on other aspects of its holdings.
Smith added that since Platolene moved its headquarters from rural Carmi to Terre Haute, Ind. in 2000, "It's been more and more difficult to keep tabs on the stores, the competition and the gasoline prices."
Smith said Niebrugge Oil Co. is similar to Platolene, an independent oil company with some branded sites. It will have about 30 stores in Illinois when the Platolene locations are absorbed, he added.
Giving up the stores was a difficult decision for Smith. "I'm the third generation of our family to be involved in the operations of Platolene," he said. "It's been difficult for me to be the one presiding over the liquidation of several stores. I have thought a lot about it, had a lot of heartache over it."
His great-grandfather, Henry Smith, and C.F. "Bud" Rebstock of Carmi were instrumental in forming Platolene 500 about 45 years ago, Smith said.
Smith dropped "Platolene" as a brand a few years ago in order to update the company's retailing image, converting it to "500 Express." "We really appreciate the loyalty that our customers have given us," he said. "It was a difficult decision for us. In life there comes a time when all must change, for better or worse. We have other businesses with an interest in, and we'll turn our focus more on that."