by John Keller | Jul 9, 2015 | Fuel Price Management, Fuel Pricing Strategy, Industry News
The US Energy Information Administration in their July Short Term Energy Outlook projects increased fuel volumes again this year. The full US EIA STEO report can be found here.
In the tug of war between ongoing increased fuel efficiency of new vehicles driving fuels demand down, and employment growth and lower fuel prices that drive fuels demand up, the US EIA projects that employment growth and lower fuel prices will continue to win and pull up volume demand in 2015.
In 2014, motor gasoline consumption rose by 80,000 b/d. In 2015 the US EIA projects that growth to be over twice as much, or 170,000 b/d (1.9%). But looking ahead to 2016, the US EIA says higher prices and increased fuel efficiency will reverse the two year trend, projecting a decrease in gasoline consumption by 20,000 b/d (0.2%). Still, if that projection proves to be accurate, demand in 2016 will be 150,000 b/d higher than 2014 and 230,000 b/d higher than 2013.
Consumption of distillate fuel, which includes diesel fuel and heating oil, is forecast to rise 2.3% or 90,000 b/d in 2015 and by 1.7% or 70,000 b/d in 2016. This growth is driven by increasing manufacturing output, foreign trade, and marine fuel use.
From a fuel price management perspective, this volume growth is a welcome respite from the many years of volume declines. While it’s certain that volumes like this cannot last forever, this report points to the urgency to make hay while the sun shines and take advantage of the opportunity at hand.
by John Keller | May 26, 2015 | Customer News, Fuel Price Management, Fuel Price Management Solutions, Fuel Price Optimization, Fuel Pricing Software, Fuel Pricing Strategy, Fuel Pricing Technology, Fuel Software, Industry News, PriceAdvantage, Retail Fuel Margins
Kocolene, an operator of 22 Fast Max stores throughout Indiana and Kentucky, experienced a 3% increase in 2014 fuel volume sales after just one year of using PriceAdvantage fuel pricing software – exceeding the national average increase by 2%. At the same time, the fuel retailer was able maximize fuel margins to create a substantial increase with overall gross fuel profits. The 2014 performance improvements are featured in a recent case study alongside other organizational benefits derived from using PriceAdvantage mobile fuel pricing technology. The case study may be found here.
In early 2013, Fast Max executives realized their manual, tedious processes for obtaining market data and setting fuel price changes needed updating. By adopting PriceAdvantage mobile fuel pricing technology, Fast Max was able to replace manual phone and paper processes for collecting competitive fuel prices, gained immediate access to accurate competitive information and market data, and automated price changes from headquarters to the store POS system and fuel price signs.
Within the first year of using PriceAdvantage, Fast Max increased its fuel sales and productivity. PriceAdvantage allowed Fast Max to quickly and easily catch developing trends in the market, signaling when an adjustment in their pricing strategy was needed to capture fuel sales. “Using PriceAdvantage, we have seen a 3% gain in fuel volumes over the previous year while maximizing margins and experiencing significant growth in gross profits. On top of that, we have a relationship with PriceAdvantage that feels more like a partnership.” Lance Gentry, Vice President of Operations.
By using PriceAdvantage mobile fuel pricing software, Fast Max corporate management reviews data, receives alerts and makes price changes on their smart phones, as well as perform many functions without having to call each store and interrupt a team member or manager who may be assisting customers. PriceAdvantage streamlined the entire pricing process and provided store managers and team members more time to service and sell to customers, as well as perform other tasks.
Fast Max chose the PriceAdvantage subscription pricing model that provided rapid software implementation with minimal upfront costs or hardware investments. This flexible model allowed Fast Max to license specific software components, enabling them to create an affordable solution to meet their specific needs. With the demonstrated increase in sales, PriceAdvantage easily delivered a measureable ROI.
by John Keller | May 22, 2015 | Customer News, Fuel Price Management, Fuel Price Management Solutions, Fuel Pricing Strategy, Fuel Pricing Technology, Industry News, PriceAdvantage
Today was the kickoff meeting for another PriceAdvantage Customer Advisory Board. The purpose of the PriceAdvantage Customer Advisory Board meetings are to provide industry updates, as well as product feedback and direction to the PriceAdvantage team. The PriceAdvantage CAB helps to be the eyes and ears of what’s going on at the front lines of the c-store industry. On this advisory board we have the wisdom of these industry leaders:
- Varish Goyal, President, Vintners Distributors
- Kyle Lawrence, President, By-Lo Oil (Speedy Q)
- Tom DiMercurio, CFO, Flyers
- Karen Meyer, Fuel Pricing Manager, J&H Oil
- Ben Stealy, Fuel Pricing Manager, Mapco
- Tom Navarre, VP Petroleum Marketing & Logistics, Family Express
In our meeting today, each member provided an overview of their business and the strategies they use to compete. Then we discussed future product versions and specific features of PriceAdvantage as a team so everyone could weigh in on what’s important.
Customer collaboration is an integral part of how we do business here at PriceAdvantage. I look forward to our ongoing meetings with this group, and learning from their collective wisdom.
by John Keller | Apr 29, 2015 | Customer News, Fuel Price Management, Fuel Price Management Solutions, Fuel Pricing Software, Fuel Pricing Strategy, Fuel Pricing Technology, Fuel Software, Industry News, PriceAdvantage
The PriceAdvantage team would like to extend a warm welcome to Get-n-Go as our latest c-store customer to join the PriceAdvantage family. Get-n-Go is using PriceAdvantage to automate and accelerate fuel pricing at their 18 convenience stores throughout South Dakota.
Get-n-Go selected PriceAdvantage based on their confidence that the software will help them price fuel more confidently and quickly.
“We’ve had our eye on PriceAdvantage for quite some time,” stated Dave Vande Kamp, Get-n-Go’s Controller. “It was simply a matter of timing. We were operating on an older version of the Gilbarco POS, and once we upgraded we were able to easily take advantage of the PriceAdvantage pre-built integration. Now all of our critical pricing data is streamlined and I can price fuel faster with great confidence that I am making a sound decision.”
Get-n-Go is running PriceAdvantage as a SaaS solution to leverage the benefits of a cloud service model including the low upfront cost, ease of implementation, and the maintenance and infrastructure cost benefits.
“The fact that I can price fuel from my phone is huge. I’m no longer tied to my desk and I have more time to focus on my other responsibilities,” stated Vande Kamp.
by John Keller | Mar 31, 2015 | Fuel Price Management, Fuel Pricing Strategy, Industry News
According to the NACS Online article here, the number of diesel vehicle sales is up 13% across the country. Sales of diesel cars and SUV’s are up 13.5%.
Idaho, Montana and Nevada have the highest percentage of diesel vehicles on their roads. But the highest increase in diesel registrations came in California and Massachusetts, where increases in both states are over 20%.
According to the IHS Automotive to the Diesel Technology Forum, there are now 7.4 million diesel cars and SUVs on U.S. roads, out of a total vehicle count of approximately 250 million. That is an increase of 47.6% since 2010.
What does this mean from a fuel price management perspective? It’s important to analyze year over year Diesel volumes and consider whether or not, and in which location, to add Diesel to your product portfolio. It could be that Diesel becomes a strategic product and location differentiator.
by John Keller | Feb 12, 2015 | Fuel Price Management, Fuel Pricing Strategy, Industry News
According to the Wall Street Journal today, the US Energy Information Administration announced Wednesday that US crude stockpiles are at another record high. Oil companies are cutting back on their drilling investments and drilling activity has slowed, but the effects are not likely to be felt until the second half of this year, so say many experts.
The total quantity of oil in storage by companies such as refiners and traders is at the highest level in roughly 80 years. The US EIA stated in their weekly report that US oil production rose again to 49,000 barrels a day to 9.2 million barrels per day in the latest week, the highest level in reports dating back to 1983.
Oil prices dropped below $50 again to $48.84 per gallon on NYMEX. Gasoline futures fell by .91% while Diesel futures fell by 1%.
What does this mean from a fuel price management perspective? This is the season when refineries shut down plants for maintenance in anticipation of the higher demand months of summer. Usually that means refinery supplies lower and wholesale prices rise. Perhaps this year the inventory surplus will keep that wholesale increase at lower levels than years past, and lower oil prices will help suppress fuel price increases.
