by John Keller | Jun 7, 2013 | Fuel Price Optimization, Industry News, Retail Fuel Margins
OPIS reported today that retail fuel margins held steady this week dipping only $0.002 per gallon across the USA. Average retail fuel margins now stand at $0.216 per gallon. The year to date average is up slightly to $0.171 per gallon, and the Q2 average is up slightly to $0.186 per gallon. The six week average is also up slightly to $0.165 per gallon.
This is good news for fuel retailers who are in great need to recoup the low margins of early and mid May.
From a fuel software perspective, these conditions continue to drive toward the need to keep a watchful eye, to make sure competitors are held in check, and to balance the fine line between fuel volume gains and maintaining fuel margins as long as possible.
by John Keller | May 24, 2013 | Fuel Price Management Solutions, Fuel Price Optimization, Fuel Pricing Strategy, Fuel Software, Retail Fuel Margins
According to the latest OPIS report, average retail fuel margins in the US were essentially unchanged this week. Retail fuel margins were up $0.001 per gallon to stand at $0.124 per gallon. Year to date retail fuel margins were down $0.002 to $0.167 per gallon. Average retail fuel margins for this quarter dropped $0.008 and now stand at $0.178 per gallon.
According to NACS, at these margins c-stores are operating at break-even levels at best, after all costs are taken into consideration. The mid-west refinery problems in the US are now clearing up, so that will provide cost reductions in the mid-west and Rocky Mountains, allowing c-stores to catch up even as they drop their retail prices. But it is this shift in cost and margins that require careful calculations to balance volumes with margins, and remain competitive while the market evolves.
Fuel software for retail fuel price management systems are the only way the fuel analyst can make the most profit in these turbulent times.
by Grant Garrison | May 2, 2013 | Fuel Price Management, Fuel Price Optimization, Fuel Pricing Software, Fuel Pricing Strategy, Fuel Pricing Technology
Speed is one of the key components of pricing optimization, as reacting to market changes faster than competitors will always keep retail fuels managers ahead of the game. Tracking the pricing strategy of all local competition enables chains to meet consumer demand with greater accuracy and efficiency. The days of sending a rep to drive around and check the prices at other stations are long gone. Now, the best possible method of ensuring pricing optimization is with application of a fuel pricing software solution.
Software offers many benefits which are unavailable with traditional fuel price analysis. Trying to track price changes via a self-developed system leads to headaches and aggravation for everyone involved. No department can be expected to become the go-to source for fuel pricing information. Tracking and recording all the changing data with in-house tools will gradually increase in complexity until it builds to total chaos. Instead of that, software pricing integration tools provide a one-stop hub where managers can access the data they need and apply it to their pricing strategy.
In order to effectively track competitor price changes, companies should obtain access to data provided by a resource such as the OPIS Radius Report. This real-time information service can gather retail fuels prices for all competitor stations within a region. Be it a 2-mile, 5-mile, or 10-mile radius, managers can use these tools to track fuel prices history in their operating environment and respond to price changes without ever leaving headquarters. It’s easier and more intelligent than it’s ever been to monitor the competition, understand their pricing strategy, and beat them to the market.
Price tracking technology has completely changed the way in which we size up the competition in the retail fuels market. Pricing reports can now be integrated with software such as PriceAdvantage to pull content directly from the report and present the data in an easily understandable interface. Making intelligent pricing decisions is no longer a complex, labor intensive task, but an effortless one. Managers can now maximize their pricing optimization by gathering the data online, porting it into comprehensive software solutions, and then instantly push any price changes to the street.
This capability to instantly visualize competitor behavior gives even non tech-savvy managers an edge in their market. It gives them the tools to react to trends and market shifts before the competition even knows what they’re doing. By the time other regional chains utilizing outdated software can react to these new conditions, the company with the right tools can be leapfrogging them to the next trend.
Don’t settle for substandard systems or business processes. Technology has made it easier than ever before to define strategy and outmaneuver competitors. Stop chasing prices and make the competition start chasing you!
by John Keller | Apr 17, 2013 | Fuel Price Optimization, Fuel Pricing Software
The most effective way to cut delays and interference out of the fuel pricing process is through the application of automated fuel pricing software. A lack of structure within the pricing system will lead to miscommunication and late changes. Automating your strategy with a fuel price management system allows you to adjust fuel prices with greater speed and stay ahead of your competitors. Streamlining the fuel pricing process paves the way for maximizing fuel profits. Retail fuels managers need only realize the potential of modern technology.
Fuel pricing software is now leagues ahead of where it stood even a decade ago. Modern advances have increased speed-to-the-street and enabled one-click price control of POS, fuel pump, and electronic price signs. In the past, managers and headquarters had to continually interact to keep things running. Communication had to be maintained to ensure that price changes were enacted. Now price changes can be made centralized from headquarters so that employees can focus on site responsibilities. This eliminates execution delays and effectively makes regional price changes as easy as a click of a mouse.
Another process simplified by implementation of this technology is competitor analysis. Rather than have agents in the field visit the locations or collect field intelligence through other disparate means, managers can now track the information on every competitor move through one centralized UI. All recent fuel cost history can be viewed and taken into consideration when making changes and managers can instantly adjust store prices in reaction to competitor moves. Modern software can also be set-up to send notifications to headquarters in response to any industry price changes. Technology has freed fuel managers from reacting, and now they can act based on up-to-the-minute data.
Maybe one of the most attractive facets of fuel pricing software is its ability to present users a complete picture of the industry. By analyzing price movements, fuel volume sales, and competitive surveys, fuel analysts can view both real-time and historical price change information allowing for better decision making abilities. Leveraging this technology improves processes and reduces operating expenses. There are no interruptions in the price change channel, as it’s all taken care of via the same tool. Technology provides a method for tracking price change implementation throughout the entire process. These fast pricing reactions, coupled with reductions in delivery delay, show the value of modern fuel pricing solutions.
So stop wasting time calling every location in an effort to coordinate fuel price changes. Instead, utilize specialized fuel pricing software to streamline, automate, and maximize profitability in your retail fuel operations.
by John Keller | Apr 12, 2013 | Fuel Price Management, Fuel Price Optimization, Industry News, Retail Fuel Margins
According to the latest OPIS report, retail fuels margins across the US had their largest weekly increase in over a month. The average retail margin today stands at $0.268 per gallon, an increase of $0.093 per gallon over last week. The last time margins were at this level was November 9, 2012.
Fuel margins averaged $0.159 per gallon for the entire Q1 of 2013. It is still early in Q2, but fuel margins are off to a good start with an average so far of $0.222 per gallon. For the past six weeks, retail fuel margins have averaged $0.223 per gallon.
This is only the second time this year when the retail fuel margin weekly increase was over $0.09 per gallon.
by John Keller | Apr 8, 2013 | Fuel Price Management, Fuel Price Optimization, Fuel Pricing Strategy, Retail Fuel Margins
The retail fuel price management game is one of balancing volumes and margins. As we watch the retail fuels volume market size shrink, or at best remain steady year over year, competition for that shrinking pie continues to intensify. If you’re not careful, the race for volume market share can be a race to the bottom for retail prices, and profits.
According to a report from the National Association of Convenience Stores, the average fuel retailer breakeven point is 12 cents per gallon, taking into consideration store operating expenses, amortization of equipment, inventory shrink, and credit card fees. So when we see the average Q1 retail fuel margins for 2013 are at $0.159 per gallon, that means fuel retailers are making very little net profit from fuel sales.
How do savvy retail fuel analysts optimize volumes and margins? By focusing on the margins of the commodities other than unleaded, like mid-grade, premium, and diesel. They analyze the strength of their product offering compared to the competition, and identify stores of opportunity where they may have exclusivity. They may discover “mid-grade stores” that can tap into that market because the competition doesn’t offer mid-grade. Or there may be “diesel stores” that have a superior offering because of pump layout and ease of access.
PriceAdvantage aids with this optimization and analysis by providing easy to use views and reports showing product volume sales, profits, margins, and competitor product offerings, by commodity. And in order to make sure you are optimizing the pricing spreads between commodities, PriceAdvantage offers a built-in cost report showing the replacement cost differential between commodities, listed by supplier.
As the fuel price management landscape continues to be more competitive, only fuel pricing software like PriceAdvantage provides the rich optimization analytics to make the best pricing decisions that lead to maximum profits.
