by John Keller | Jul 31, 2012 | Retail Fuel Margins
Valero retail fuel margins and volumes generate record high operating income.
In today’s Q2 business update, Valero announced the Corner Stores retail division contributed record high quarterly operating income, thanks to the combination of their robust retail fuel margins and retail fuel volumes. The US Corner Stores retail division had quarterly retail fuel margins of $0.303 up from $0.204 for the same period last year. Retail fuel gallons per store per day were 5,162 which was up from 5,094 the previous year.
For the first six months of the year, Valero Corner Stores retail fuel margins in the US stand at $0.178 which is up from $0.142 year over year.
The Valero earnings report for this quarter may be found here.
The PriceAdvantage team is proud to have Valero as a partner that selected PriceAdvantage as its fuel price optimization software, and we are happy to share in the great success of the Corner Stores retail group.
by John Keller | Jul 6, 2012 | Retail Fuel Margins
Retail fuels prices remain flat this week says AAA.
According to AAA, OPIS and Wright Express, national regular gasoline prices held steady for the week at $3.358 per gallon after having dropped almost $.60 per gallon since early April.
Michael Green, a spokesman for AAA, says this could be a sign that the cycle of declining gas prices has come to an end.
From a fuel price management standpoint, these times require a watchful eye on fuels prices on a market by market basis, because margins may begin their decline as retail prices hold steady.
by John Keller | Jul 5, 2012 | Fuel Price Management, Retail Fuel Margins
Today we had an interesting conversation with a CEO about what benefits he gets out of using PriceAdvantage as his retail fuel price management solution. He listed two specific interwoven benefits.
He described what it was like before PriceAdvantage, where he would send fuel price changes to the stores, and the store personnel would assure him they had implemented the price changes. Then he would drive by his stores and see they still displayed the old prices because the store folks hadn’t in fact changed the prices. Then there would be hours spent following up with the locations to follow through with the price changes. As you can imagine, this was a source of great frustration because his stores did not have the right prices at the street, and there were a lot of hours wasted on operations that would be better spent on strategic thinking.
Now with PriceAdvantage, he says he knows the price change has been completed when his Fuels Manager receives the automated successful price change confirmation email. In most cases, the Store Manager is removed from the fuel price change process completely because his company has integrated PriceAdvantage with the VeriFone POS. And in those cases where there is an operational problem, the Fuels Manager receives an automated email notification of a delayed price change, allowing her to follow up on an exception basis. That results in a savings of upwards of two hours each day.
So the PriceAdvantage benefits for this CEO are two-fold: confidence that based on their gasoline pricing strategy, the right retail price is at the right store at the right time, and hours gained each day in the operational fuel price change process.
by John Keller | Jul 3, 2012 | Fuel Price Management, Industry News
According to NACS, there have been accusations of fuel price gouging in the aftermath of last week’s storms and the declaration that West Virginia is in a state of emergency.
According to West Virginia Assistant Attorney General Douglas Davis, state law says “you take the date of the emergency declaration, go back 10 days, and whatever the price was then, you can raise it 10% before we get interested.”
In Virginia, price-gouging laws are in effect through July 30, after the Governor declared a state of emergency June 29. The law in Virginia states that businesses can be charged with price gouging if they charge a price that is “unconscionable” when compared to the average price of the same product during the emergency declaration. The term “unconscionable” is not defined.
In times of these accusations, Fuel Price Management software solutions such as PriceAdvantage can shorten a fuels price audit from days needed to track down stacks of spreadsheets, to a few minutes needed to run a built-in fuel pricing history report.
by John Keller | Jul 2, 2012 | Industry News, Retail Fuel Margins
In today’s Gasoline and Diesel Fuel Update, the US EIA reported regular unleaded fuel prices across the US dropped for the 13th consecutive week, this time by $0.081 per gallon to $3.356. Fuel prices haven’t been this low since before January 9, 2012. Unleaded regular fuel prices are now $0.223 per gallon lower than one year ago.
The Midwest and West Coast regions both saw a weekly drop of $0.108 per gallon, the biggest decrease of all the regions in the US. In the West Coast region, the average regular unleaded fuel price is now $0.47 per gallon less than one month ago.
Regular unleaded fuel price averages are lower than last year in every region except in the Rocky Mountain region, where fuel prices are $0.064 per gallon higher than last year.
Diesel prices dropped $0.03 per gallon, which is $0.202 per gallon lower than this time last year.
by John Keller | Jun 29, 2012 | Uncategorized
I write this blog from the PriceAdvantage office in Colorado Springs, on the Friday of the week where our city suffered the worst fire in its history. Over 300 homes were destroyed as well as many businesses. At the time of this writing there are reports of one human life lost, and fewer than 10 people missing. Thankfully, of the 1000 firefighters engaged there are no reports of injury or fatality. Considering the magnitude of the fire, those numbers are remarkable.
Beyond the personal side of this story, there is a business side as well. We have PriceAdvantage customers who operate c-stores in the impacted areas, where their streets were evacuated, and who serve customers living in the evacuated areas. Needless to say, in Colorado Springs this week will go down in history as one like no other.
From a fuel price management perspective, it is critical moving forward to record the specifics of where and when fuel volumes were impacted by this event. That way next year and in the years to follow, when store and market performance is measured, the fuel manager can quickly remember the specifics of this week.
In PriceAdvantage, we make it easy to annotate details of a specific date in time, and we display those notes when viewing volume performance. Hover over the volume chart for a specific date and see the note mentioning the impact of the fire, for example.
As the city of Colorado Springs recovers, and our customers return to business as usual, PriceAdvantage will allow fuel managers to make sense of the business impact of this natural disaster.
by John Keller | Jun 28, 2012 | Fuel Pricing Technology
Google entered the mobile tablet market today with the launch of their Nexus 7. With a $199 price point, this product is a direct competitor to the Kindle Fire, and provides another less expensive alternative to the iPad.
The Google browser built in to the Nexus 7 has already proven to be an effective way for fuel price managers to gain access to fuel pricing software systems like PriceAdvantage while away from their desk. PriceAdvantage customers already use their tablet and smart phone devices while traveling, at meetings outside the office, or at home, to review proposed prices based on established competitor business rules, and to remotely send fuel price changes to the street. PriceAdvantage customers can then check their mobile device for confirmation of when the price change was complete.
With the Google Nexus 7, fuel price managers have another mobile tablet option to manage fuel prices across their c-stores.
by John Keller | Jun 28, 2012 | Industry News
According to an industry analyst, oil prices and gasoline fuel prices will remain near current levels throughout the driving season this summer.
Earl Sweet is a Managing Director and Senior Economist at BMO Capital Markets, a financial investment firm. His 2012 summer fuel price prediction is based on the state of international economics, namely the European debt and banking crisis. Mr. Sweet believes these economic conditions outweigh the supply risks that have driven fuel prices down in recent months.
From a fuel price management perspective, we may see margins start to erode as markets are content with lower profits as time passes and they make up for a weak early part of the year.
by John Keller | Jun 27, 2012 | Fuel Price Management, Industry News
The national motorist association AAA is predicting the highest number of travelers for the Fourth of July holiday in the past 10 years, thanks in part to falling gasoline fuel prices. In some states, AAA is seeing gas prices drop a penny a day. The average price in South Carolina is already at $2.98 per gallon, with Mississippi, Tennessee, and Alabama averaging just over $3 per gallon. AAA sees fuel price drops accelerating, and predicts several of these states may soon join South Carolina under the $3 per gallon level.
AAA predicts 42.3 million travelers on the road for the Fourth of July holiday. That is nearly 5% more than last year. Besides falling gasoline fuel prices, having the holiday on a Wednesday provides a substantial boost because of the weekend on either end.
From a fuel price management perspective, expect higher fuel volumes for this holiday over last year.
by John Keller | Jun 26, 2012 | Retail Fuel Margins
Last year’s national retail fuel margins rose 25% to 18.8 cents per gallon.
According to Convenience Store News, the gross retail fuel margin in 2012 reached 18.86 cents per gallon nationally, compared to 15.03 cents per gallon in 2010. That’s a 25.5% increase in retail fuel margins year over year.
Meanwhile, the annual fuel volume gallons per store number was 4.1% lower year over year, falling to 1,205,095 gallons for 2011. That equates on average to 100,425 gallons per store per month across the nation. CSNews attributes the fuel volume drop to a slower economy, high unemployment, and more fuel-efficient automobiles.
From a fuel price management perspective, it is important to use these benchmarks to help gauge the relative performance of individual stores, markets, and overall chains.
