In the fuel market industry, price fluctuations are a reality. They cannot be outright controlled, however, steps can be taken to help minimize the impact they have on your bottom line.
Your fuel distributor’s supply and risk marketing manager will analyze local and global market conditions in order to forecast pricing and determine good prices to buy and sell. When that valuable information is passed along to you, the customer, there are three things that can be done to protect your business from higher fuel prices:
- Utilize your own storage – when prices are down, stock up and purchase fuel once or twice a year;
- Truckload – if storage space is not available, time your delivery on a day when prices are lower;
- Long-term program – sign on with fixed price contracts that will last through the year with one truckload at a set price and one truckload at a flex price.
Purchasing fuel is all about timing. With experience in forecasting fuel prices much further in advance, a fuel supply and risk marketing manager can also advise when to buy and the associated risks. Even if your contract price is above the going rate, you are still ahead because you know what your costs will be.
Knowing you are making the most of your purchase is not the only benefit of working with a fuel distributor. With more control over your fuel expenses, it will make budgeting easier and also allow you to move funds into other areas of your business. For example, when gas prices are higher, you can encourage customer spending beyond the pumps.
A recent IRI Market Pulse survey found that 44 percent of consumers are likely to spend less on groceries if gas prices rise by 50 cents per gallon. The good news for convenience store and gas station owners and managers is that things such as displays, videos, or stacked product at the pumps can bring buyers into the store. In fact, product growth has been shown to double when casual outdoor advertising is used compared to when it is not. Now that’s a price you don’t want to pass up!
A great fuel distributor will not only deliver the Right Product, at the Right Place, at the Right Price, they will also be there to help their customers succeed. Take advantage of their available resources and meet with a fuel supply and risk marketing manager today.