December 28, 2020

Maximize Profitability with Proper Fuel Management

The Challenge of Fuel Management

Managing fuel is an extremely complex process for gas stations and convenience stores, far more than any of their other products. Not to mention it requires a great deal of oversight in order to comply with regulatory requirements from federal, state and local governments. Since all three of these levels of government are meticulous in their requirements, gas stations and convenience stores must be meticulous in following those regulations. And on top of all of that the businesses are operating with very small profit margins.

Gas station owners are required to track tax liability and report tank storage compliance according to the EPA’s guidelines. Failure to comply with petroleum industry regulations can result in fines and penalties. For many companies, the culmination of competition and intense regulation has meant they must look for different methods that will allow for increased efficiency and profitability.

What You Need for an Inventory Management Plan

Creating a fuel inventory management plan can raise your bottom line by effectively managing fuel supply and demand, while ensuring regulatory guidelines are met. With full visibility of your fuel inventories, you can avoid keeping excess fuel that eats up revenue. Managing fuel reserves to ensure there is enough to meet demand without absorbing all of your profit margin in excess is crucial for any company. Having too much fuel on hand means you may struggle to make ends meet. Having too little means that you could run out, meaning your customers go elsewhere and you lose sales.

Many successful gas stations invest in fuel management software that keeps track of fuel inventory, processes secured payments, and has real-time reporting of fuel sales. You may already have one of these types of systems or you may not, but either way, you need to know how much fuel you have at any given time so you can contact your supplier to get a refill before you run out.

Secured payments at the pump are becoming nonnegotiable for gas station and c-store owners. Due to the EMV compliance deadline in April 2021, all gas stations will be required to have EMV payment processors. EMV Compliance protects you from 100% of these unwanted penalties like liability for fraud and chargebacks, and it increases the loyalty of your customers who trust in the security of your processing equipment.

The key is being able to maintain accurate records of your fuel balance on a daily basis, rather than a monthly or even weekly basis. In this way, you can continuously monitor use versus availability to ensure an accurate plan for how soon you will run low. This allows you to plan out your future purchases more accurately. To maximize profitability you’ll need to analyze fuel data to forecast costs and plan your purchases.

Effectively forecasting fuel costs gives you a competitive edge in the volatile market of fuel sales. Detailed insight into your fuel costs and future purchases helps you determine profit margins and gives you the power to set gas prices that will actually make you profitable.

Effectively Manage Fuel Supply with Konnect General Services

With Konnect General Services you’ll get the fuel solutions you need, no matter where in the country you run your business.

With our highly skilled team you will receive the fuel you need, when you need it, and at competitive pricing. We offer real-time tank monitoring software that ensures you can stay competitive in the industry, with high quality fuel inventory management and the ability to manage aggressive fuel market pricing.

Get the flexible fuel supply contracts you need while maintaining quality service and the best brands by contacting our team today.