OAK BROOK, Ill. -- There has long been a misconception that gasoline sells itself. No category management needed. Little brainwork for jobbers and dealers. Transport from terminal to station and the motorist will take care of the rest.
Wrong.
A growing line of retailers are cutting hauling costs, perfecting optimum inventory levels, reducing unneeded labor, streamlining routes and upgrading dispatching through intelligent software solutions.
The upshot?
Greater margin at the pump.
"If you keep your tanks full you may be tying up working capital and delivering more frequently than needed," said Rich Witmer, director of marketing at Houston-based FuelQuest. "Plus, with little room you won't be able to take advantage when prices drop."
In the April issue of CSP magazine, Toledo, Ohio-based truenorth energy, a Shell marketer of more than 300 company-run and dealer-operated stores across three Midwestern states, shared how FuelQuest's ForeSite and Fuel Management System software have given the company the ability to track real-time supplies of not only their product underground but supplies at the nearest terminals and the ability to forecast out of stocks at individual locations.
"When you look at your loads in a particular district, [ForeSite's graphical maps] will tell you by color-coding how urgent the situation is," Mickey Conway, truenorth's vice president of trucking, told CSP in the April article. For example, he said, "Red means fuel must get there on this shift or they're going to run out." (See Related Content below.)
[Conway will be featured in a special CSP webinar next Tuesday called "Fueling Business: How Retailers Can Gain a Competitive Edge at the Pump." The webinar is sponsored by FuelQuest and is free to all retailers and wholesalers. To register, click here.]
Witmer said inefficiencies continue to permeate the downstream distribution market adding pennies of unnecessary costs to each gallon of fuel. Among the examples he cites include the lack of real-time forecasting to capture the impact of changing demand patterns at the station and a continued dependence on manual reconciliations. "If you have multiple sites, managing your inventory by hand can be cumbersome, inefficient, and competitively insufficient," he said. "There are proven, end-to-end software options available to replace spreadsheets as well as in-house or point solutions. Even if you are not sure what you need, the right vendor can help you benchmark where you stand against the rest of the industry."
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