by John Keller | Nov 21, 2014 | Fuel Price Management, Industry News, Retail Fuel Margins
After four consecutive weekly declines, the average retail fuel margin across the US rebounded $0.025 per gallon this week, according to OPIS. That brings the national average to $0.272 per gallon, which is $0.13 per gallon higher than last year at this time.
The year to date average is $0.207, slightly higher than this time last year when the year to date average was $0.191 per gallon. The average for the quarter is a robust $0.294 per gallon, while the six week average is $0.308 per gallon.
According to Schneider Electric, US refineries are at a strong run rate, yielding a greater supply of gasoline and increased gas inventories. That means we can expect a different trend over the upcoming weeks than what we saw last year at this time, and retail fuel margins should remain strong as gas prices continue to decline.
by John Keller | Nov 21, 2014 | Fuel Price Management, Fuel Pricing Strategy, Industry News, Retail Fuel Margins
According to an article written by Brian Milne of Schneider Electric and published in Convenience Store Decisions, US refineries are increasing their production after being down for maintenance, bringing the run rate above 90%. That’s a run rate last seen in mid-September.
What does that mean from a fuel price management perspective? The higher run rate will lead to a greater supply of gasoline, gas inventories will increase, wholesale fuel prices will push lower, and ultimately retail fuel prices will continue to decrease leaving open the opportunity for robust fuel margins.
In November, the US Energy Information Administration lowered their predicted average retail fuel price to $2.94 per gallon in 2015, which is 13% lower than their predicted price in October. Likely that will lead to increased demand for fuel, or at least steady demand levels compared to this year.
by John Keller | Nov 19, 2014 | Customer News, Fuel Pricing Technology, Fuel Software, Industry News, Retail Fuel Margins
CST Brands announced their financial results for the quarter ending September 30, 2014. Earnings were $.90 compared to expectations of $.57.
From the report: “Motor fuel gross profit (per gallon) in the U.S. for the third quarter of 2014, after deducting credit card fees, was $0.25 compared to $0.16 in the third quarter of 2013, which was primarily caused by a declining crude oil and wholesale gasoline pricing environment combined with the Company’s fuel pricing strategy.” [bolded text from this author]
In the US stores separately, the numbers are as follows:
- Q3 retail fuel margin before credit card fees of $0.288 per gallon up from $0.203 for Q3 in 2013
- Q3 gallons per site per day of 4,921 gallons or approximately 152,000 gallons per month
- Q3 NTI stores gallons per site per day of 9,547 gallons or 295,000 gallons per month
The numbers are quite impressive, and the financial analysts are noticing. CST stock is now trading at $43.27 a share, up 23% over the past three months, and up 32% for the year.
by John Keller | Nov 18, 2014 | Customer News, Fuel Pricing Strategy, Fuel Pricing Technology, Industry News
In the November 2014 issue of CSP Magazine, Greg Parker explains how the success of Parker’s has allowed the company to achieve his extraordinary goals. You may find the article online here.
Previously, Mr. Parker had written a guest article for CSP magazine’s October 2013 issue, where he outlined what he calls a “Big, Hairy, Audacious Goal” to grow the Parker’s Company from a $500 million company to a multibillion one over the upcoming decade.
The numbers in the article are quite impressive:
- eight stores built in 10 months
- EBITDA (earnings before interest, taxes, depreciation and amortization) has increased 36.8%
- overall gas sales at Parker’s have increased by 33% over last year
- gas sales for stores open at least a year have increased by 5.9% over the previous year
- in-store sales have surged to 28% over last year
The PriceAdvantage team is proud to have Parker’s as a customer and partner. For many years, Parker’s has been an electronic gas price sign customer of Skyline Products, the parent company of PriceAdvantage. In January 2012, Parker’s completed their rollout of PriceAdvantage to all their stores. Besides using Skyline electronic gas price signs, the Parker’s fuel price management solution also includes the PriceAdvantage integration with the NCR Radiant POS and GasBuddy OpenStore. Click here to see a video interview with Jeff Bush, Director of Fuel Management at Parker’s, discuss how he uses PriceAdvantage Optimization.
by John Keller | Nov 14, 2014 | Fuel Price Management, Industry News, Retail Fuel Margins
The OPIS report today showed that retail fuel margins across the US remain strong. The average retail fuel margin now stands at $0.247 per gallon, down $0.028 per gallon from last week, but still $0.025 per gallon higher than this same week last year.
The year to date average is the same as last week, remaining at $.205 per gallon. The average for the quarter is down slightly to $0.297 per gallon. The six week average is up slightly to $0.311 per gallon.
What can we expect in the upcoming weeks? Last year we saw margins dip slightly through the rest of November, before bottoming out the end of December. Last year the final week of the year had retail fuel margins of $0.14 per gallon, which was $0.09 per gallon lower than this equivalent week last year. If wholesale costs don’t drop further, we may see such a drop again.
