Pump And Tank Shop, Inc.

Last year when gas prices first topped $2.00 per gallon, most mechanical gas pump were equipped with Veeder-Root 2002E computers, which allow gasoline price-per-gallon amounts to $2.999 and total sales to $99.99. Now as gas prices approach $3.00 per gallon, there are multiple issues, which must be dealt with in order to continue selling from your mechanical gas pump.

Existing 2002E computers can be upgraded to allow pricing to $3.99 per gallon with the installation of a compound idler gear kit. This kit sells for $15.00 and can be installed in less than one hour per computer. This is a simple fix and does not require replacement of pulsers or other pump hardware. There are two drawbacks, however, in that the $3.00 pricing capacity takes the place of the $2.00 pricing capacity of the unit. In a marketplace where gasoline price fluctuates between $2.999 and $3.019, this would require installing or removing the gear kit each time the price changed. In addition, this modification does nothing to address the total sale amount. In a market where total sales of over $100.00 will become commonplace, after a 2002E computer totals to $99.99, it rolls over to $0.00, making a sale of $108.00 appear on the computer as $8.00, discernable only by the total gallons displayed, which will still go to 999.9. North Carolina weights and measures will allow computers that do not display the $100 digit in the total sale, but

Virginia is following the national weights and measures recommendations and IS NOT allowing this option. In Virginia, you must use a computer that displays the total sale amount.

The obvious alternative is to then install a Veeder Root VR-10 computer, which allows pricing up to $9.99 per gallon and total sales to $999.98. The drawbacks to this option are the fact that with limited availability of rebuildable cores, you are usually trading in a 2002E against the purchase of a VR10, which carries an upgrade cost of $65.00. In addition, standard Western 400B pulsers will not work with the VR10 computer and must be replaced with either a Western 500 pulser (single pumps and dispensers, but will not work on duals due to space limitations) or the ICS SP-1 (dual pumps and dispensers). Also, as gas prices increase, it may be possible to see shortages of rebuilt VR10 computers due to the relatively smaller number of cores in circulation, as well.

One other alternative is the installation of a Veeder Root VR-10/4. The VR-10/4 is based on the 2002E configuration in that you may use your existing pulsers. It will price to $3.999 per gallon, but will only show a total sale to $99.99. It is not an option in Virginia, and ultimately other states may adopt the same requirements, so we question whether this would be a wise investment when looking toward the future. One advantage, however, is that while in function it is nearly the same as the upgraded 2002E, it does not require modification to cross the $2.999 - $3.009 threshold.

SUMMARY OF OPTIONS & COSTS:

Upgrade your existing 2002E computer with the addition of a gear kit - total initial cost $15.00

• Must convert back and forth from $2.00 pricing to $3.00 pricing, at ongoing costs for this conversion.

• NOT an option in Virginia, West Virginia, or for more than 30 days in South Carolina, as this will not allow total sale over $99.99. In North Carolina this practice remains legal at this time, but may frustrate or confuse customers.

Install VR-10 computer - total initial cost $395.00, with $85.00 core credit allowed when trading in a 2002E.

• Requires replacement of pulsers - single $135.00 each, twins $179.95 each computer.

• Required in Virginia & West Virginia, this may be the best long-term option as future weights and measures requirements may demand the $999.98 total sale capacity, and will eliminate customer confusion.

Install VR-10/4 - total initial cost $395.00, with $85.00 core credit allowed when trading in a 2002E.

• NOT an option in Virginia, West Virginia,, or for more than 30 days in South Carolina, as this will not allow total sale over $99.99. In North Carolina this practice remains legal at this time, but may frustrate or confuse customers.

HALF - PRICE SALES:

A technique from the gas shortages of the 1970s where price per gallon is set a exactly half of the desired total, and the total sale shown is doubled for the final total sale price. If a price per gallon of $3.028 is desired (tenths must be even number, since 9/10 cannot be halved for this purpose), price per gallon would be set at $1.514. When the sale is completed, the purchaser would owe exactly twice the amount shown on the total sale wheels. Specifically NOT allowed in Virginia and West Virginia, allowed for no more than 30 days in South Carolina, and allowed indefinitely in North Carolina only at stations selling a total of less than 60,000 gallons or per year of all motor fuels. NOT a practical option.