Prepare to Fuel Profits
What convenience stores need to know to be the future sales leaders of the fuel world
Brought to you by Source North America.
More and more convenience store operators are adding E15 to their forecourts (almost 900 stations in 29 states have added the fuel since 2012). This surge in E15 adoption has many c-store owners wondering if the fuel will emerge as a sales leader. Could E15 one day be the new E10, or should c-store operators upgrade their sites to offer other alternative fuels? The answer is likely both.
A growing E15 market
E15 is approved for use in conventional light-duty cars and trucks, as well as all flex-fuel vehicles, model year 2001 and newer. This represents almost 90% of today’s automotive fleet. In addition, a bill has been proposed that would allow E15 to be blended and sold year-round (current Reid Vapor Pressure requirements prevent the sale of E15 during the summer). With a potential savings of 10 cents per gallon for consumers, E15 provides a way for fuel marketers to deliver value to customers at the pump. However, retailers should be advised that any decision to provide E15 requires a review of existing fuel infrastructure to verify compatibility with certain ethanol blends.
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Other fuels with potential
E15 is not the only alternative fuel beginning to assert itself on the forecourt. According to the Alternative Fuels Data Center, total public alternative fueling station counts are as follows:
- Electric - 16,293
- LPG - 3,152
- E85 - 3,001
- CNG - 953
- Biodiesel - 197
- LNG - 76
- Hydrogen - 40
Currently, the expansion of alternative fuels differs widely from state-to-state. California leads EV, CNG, LNG and Hydrogen installations, while E85 is established in the Midwest; Oregon has the most biodiesel stations, and Texas offers the most LPG stations.
Why is this significant to c-store operators? For decades, two fuels—gasoline and diesel—have consistently dominated the U.S. fueling landscape. In the future, the type of fuel that will be in demand may be influenced by station location. For instance, rural locations will likely have different needs than urban areas. More than ever, c-store owners need to be in tune with the needs of their local market.
Revenue by design
Within c-stores, customers can expect to find just about anything they need—from shampoo to umbrellas, c-stores have it. Soon, that may be the same on the forecourt.
For instance, the forecourt of the future may have a couple of fuel islands offering traditional fuels, while another fuel island may offer higher ethanol blends or hydrogen fuel, and yet another offers charging stations.
Alternative fuels not only capture new revenue, they secure the loyalty of new customers as well. C-store owners who offer alternative fuels sooner than neighboring fuel sites stand to get an edge on their competition.
But, without a clear alternative fuel emerging as the definitive leader, the challenge for c-stores becomes an issue of investment planning and land use. This is especially true of independent operations that do not have the support of a brand partner to guide them. Flexible site design will be key to adaptability and growth. Consult with a fuel site infrastructure design expert such as SOLUTIONS Design Group to develop a site plan that will position your site to begin capturing new revenue in both the short and long term.