by John Keller | Oct 8, 2013 | Fuel Price Optimization, Fuel Software, Industry News
According to Recargo, a software and services company providing guidance to drivers and industry supporting the adoption and growth of plug-in car technology, the number of electric vehicle charging stations in the US has grown from under 2000 stations in 2011 to over 20,000 stations in 2013.
These charging stations fall into several categories. There are 11,720 stations that can add about 25 to 30 miles of range in 60 minutes. There are about 368 stations that can add about 50-60 miles of range in 20 minutes.
One of the ways Recargo makes its money is by collecting data on the electric car industry. Recargo projects there will be 170,000 electric vehicles on the US roads by the end of 2013, including both 100% electric vehicles and plug in hybrids. According to Recargo, the average salary of the electric car owner is above $200,000.
Recargo provides an app called PlugShare that shows public charging spots across the US. The app has been downloaded 200,000 times.
What does all this mean to the retail fuels manager? It should serve as a wake up call that the US is seeing a transformation of the electric vehicle and the electric charging station into the mainstream, especially in California, the state with the highest number of electric car charging stations in the US.
While the electric charge may or may not be the high margin fuels alternative, certainly in-store sales and food opportunities abound with the charging times the electric vehicle customer is accustomed to.
by John Keller | Sep 30, 2013 | Fuel Price Management Solutions, Fuel Price Optimization, Industry News, PriceAdvantage
A team representing PriceAdvantage just spent the week at the Insight NACS Future of Convenience industry show in London. It was an exciting time for us because for the first time we were able to show off the international capabilities of PriceAdvantage, where we can now price fuel in any country, without constraint for gallons or liters, or number of digits to the left or right of the decimal. Where previously PriceAdvantage was only able to handle prices ending in nine tenths, PriceAdvantage can now price fuel to three digits to the right of the decimal, and unlimited digits to the left of the decimal. That means from now on PriceAdvantage is a powerful solution for any country in the world. In addition to this internationalization of the product, we were able to show off the first localized version of PriceAdvantage, fully translated into French.
But this tradeshow was exciting for us in another way as well. It became clear throughout the conference that the same problems PriceAdvantage addresses for our US customers are shared with c-store fuel retailers everywhere. As one speaker put it, there are no unique problems in the c-store business around the world, just the same problems in different parts of their lifecycle. Here are three examples.
1) Retail fuel volumes continue to decline year over year. According to the Belfast Telegraph, petrol sales continue to plunge, as much as 5.8% from January to June of 2013 compared to the same period last year. That represents a decrease of 512 million liters. Diesel fuel sales increased over the same time period, but only by 270 million liters, not enough to result in a net gain. The article attributes the loss to changes in consumer behavior to cut back on their driving.
2) Grocery chains and c-store chains are in a major battle for fuel volumes. This article in the London business newspaper City A.M. reports that supermarkets are in a fuel pricing war. The article goes on to say that the supermarket chain Sainsbury’s just cut their petrol prices by 6 pence and diesel by 4 pence in a battle with Tesco and Asda.
3) Fuel profit optimization is most powerful when viewed as part of the overall gross profits of the store. In many cases, the advertised fuel price is strategically used as an advertisement to attract customers to the high margin food and store merchandise product offerings. One speaker called fuel, merchandise, and food the three pillars of c-store profitability. As retail fuel managers learn about correlations between fuel volumes and in-store profits, and how these correlations vary depending on the markets in which they compete, the fuel managers can use fuel software to optimize volumes and margins based on differing market profiles and with an eye to overall store profits across all categories.
September 2013 represents a significant milestone for PriceAdvantage as it is our launch into markets outside the US. We will continue to introduce more capabilities for our customers around the world, providing a dramatic ROI in a short time frame, by solving industry problems no matter where they may be on the fuel management timeline.
by John Keller | Aug 23, 2013 | Fuel Price Optimization, Retail Fuel Margins
According to the OPIS report today, average retail fuel margins across the US ended their streak of four consecutive weekly gains, losing $0.069 per gallon this week.
Retail fuel margins across the US now stand at $0.187 per gallon. The year to date average remains at $0.182 per gallon and the six week average is now at $0.192 per gallon. For the summer season since Memorial Day, the retail fuel margin average has been $0.206.
While retail fuel margins lost ground this week, they are still a solid $0.06 higher than last year at this time.
Using PriceAdvantage, these types of statistics and comparisons are available with a few quick mouse clicks. How difficult is it to compare your retail fuel margins to these industry benchmarks using your system?
by John Keller | Aug 16, 2013 | Fuel Price Optimization, Retail Fuel Margins
The OPIS report today reveals a $0.038 increase in retail fuel margins this week. National retail fuel margins across the US now stand at an average of $0.256 per gallon, which is $0.132 above the margins for the same week one year ago, when national averages were a measly $0.124 per gallon.
The year to date average across the US now stands at $0.182 per gallon while the Q2 average is at $0.205 per gallon. The six week average stands at $0.189, and since Memorial Day the average is $0.208 per gallon.
These are proving to be the strong months of profitable margins and traditionally high summer gallons. Now is the time to make the most of these summer days in anticipation of decreasing volumes.
by John Keller | Aug 2, 2013 | Fuel Price Management Solutions, Fuel Price Optimization, Retail Fuel Margins
OPIS reported this week that average retail fuel margins across the US added to the gains of last week and increased by $0.038 to $0.214 per gallon. That makes for an $0.114 increase from just two weeks ago when retail fuel margins were at an abysmal $0.100 per gallon.
Though the increase in margins this week did not bring retail fuel averages to the levels of July 5 when margins were at the highest level of the year at $0.302 per gallon, the increase did raise year to date margins to $0.178 and the Q2 average to $0.193. The six week margin average stands at a strong $0.206 per gallon.
Considering the prediction for increased retail fuel prices by many industry analysts, margins this week didn’t suffer by any such retail fuel price rise. Hopefully retail fuel prices can remain steady throughout the summer and make for a profitable season.
by John Keller | Jul 22, 2013 | Fuel Price Optimization, Fuel Pricing Strategy, Retail Fuel Margins
We’re seeing news stories all over the country, both nationally and on a local level, bracing US consumers for rising retail fuel prices in the coming weeks. The reasons given include unrest in Egypt, increased demand due to the summer season, and production disruptions in the US.
The source of the stories is consistently the American Automobile Association (AAA), which receives its pricing information from OPIS. The PriceAdvantage integration with OPIS allows PriceAdvantage customers to provide their latest pricing information to OPIS, and thus display the current gas prices on websites that receive pricing information from OPIS, including MSN Autos, Garmin, AAA, and MapQuest.
From a fuel management perspective, these news stories mean two things.
- If OPIS is correct, and wholesale prices continue to rise, fuel retailers are looking at more weeks with continued slim retail fuel margins. It will be a time period of holding on, waiting for the crest and fall of wholesale prices when retail prices can catch up, and retail margins can be restored.
- Consumers may not be happy with increased retail fuel prices, but at least they won’t be caught off guard. That means there will be opportunities for fuel retailers to adjust retail fuel margins and make up lost ground when wholesale fuel prices drop again.
In order to navigate these times of fluctuating retail fuel margins, analysts in the fuel management area need to maximize their investment and use of their fuel software to optimize fuel profits. Only the most sophisticated fuel software can provide the optimized balance between fuel margins and fuel volumes in times like these.
