The R134a Freon Commodity Game

Buckle up it’s auto refrigerant time again. If you are in the automotive world you know it can be 90 dollars today and 120 dollars next week. That’s why it is a commodity. Back in the day I used to sell pallets and could not believe the price freon was bringing. Car freon is wholesalers can make some money or loose their tale at the end of the year if the freon prices drop even though that rare. Wholesalers would buy tractor trailer purchases to get the best price and usually in December. I sold more refrigerant r134a during december than any other month.

For the automotive shops it’s slightly a different game. The shops would have to buy air conditioning freon in small purchases which was pretty expensive but they are also billing with a mark up to the end user or Johnny on the street. The sad part is you almost have to stay on top of today’s cost so you don’t loose out on profit. Now for the customer you have to realize that once that r134a freon is gone then the shop has to purchase another cylendar and that price probably sky rocketed so it’s a wild ride.

I had a customer call today and asked the price. I then called a very small supplier and he had about fifteen left and bought them for $85.00 – my cost $102.00 I called the customer back and told her $125.00 and she flipped out saying I was the cheapest around. What was the going rate for r134a? The highest quote she got was $179.00 – what a difference! I then proceeded to call my major supplier and I would have to buy a pallet (that is about 40 cylendars) and my discounted rate was $125.00 – wow. Needless to say i’m buying a couple of pallets; sell some and hold on to some. Make sure you shop around. Some places will sell at a mark up of their purchase price and not what the cost of their next purchase!

As much as it might hurt you really need to buy what you think you need times two or three. You will make your money back but keep up with the new commodity car freon price. A quick call to your local parts store will keep your numbers in line. If you get a really good deal – yes they come along – make sure you call a couple of other shops and let them know you can buy in volume and if they would like to go in with you for this great price; of course after you mark it up a couple of bucks! Don’t worry you are doing them a favor because they need to buy freon too. The customer will get the quote and freak out but car air conditioning is not optional – especially if you live in the south like I do. They have to suck it up and pay it. I hope you found this article helpful and let me know if I can help.