By Keith Reid
There were a range of notable announcements in 2016 relative to the major vendors serving the industry. That trend continued when the New Year started off with a bang following Temple, Texas-based PDI’s January 5 acquisition of the enterprise resource planning (ERP) assets of The Pinnacle Corporation. This was on top of PDI’s October acquisition of Intellifuel and its fuel management and logistics solutions for downstream and midstream participants in the fuel supply chain.
The ERP functions provide organizations with the traditional “back office” and “wholesale fuel” requirements of accounting, cash management, price book, inventory fuels purchasing and distribution functions, among others. Pinnacle will retain remaining assets and customers for its point of sale, payments, loyalty and its new Affinity™ mobile solutions.
“We are excited to add Pinnacle’s offerings, people and expertise to our existing portfolio,” said Jimmy Frangis, PDI’s Chief Executive Officer in the announcement release. “The addition of Pinnacle’s software further demonstrates our commitment to the convenience retail and wholesale petroleum industries. Pinnacle has a great customer base, and we look forward to serving these customers and their business needs for many years to come.”
Drew Mize, former Pinnacle President, was one of those who made the move to PDI as Vice President of PDI/Pinnacle Operations. Mize will spearhead Pinnacle’s integration into PDI.
PDI and Pinnacle had been strong competitors in what is still a competitive marketplace with multiple solution providers. There are obvious market implications with the acquisition, but beyond that, what are the implications for existing Pinnacle customers? According to Mize, Pinnacle customers remain the priority.
“I think the most important thing is for Pinnacle customers to recognize that PDI is going to support them just as Pinnacle did,” said Mize. “The immediate-term plan is that PDI will continue to support Pinnacle clients on the products that they purchased for as long as they choose to use them. PDI will honor all contractual commitments made by Pinnacle and will continue to support and develop the products for as long as clients would like to use them.”
Mize noted that there will be active support. Between full-time employees and contract labor, PDI has acquired the bulk of Pinnacle’s staff that were exclusively focused on the product lines related to the assets that were purchased. That includes a significant number of developers and services team members.
“When you consider the quantity of Pinnacle employees that are coming over in all areas of product support, services and development, I think PDI’s intentions concerning the customers and the products they rely on becomes abundantly clear. If there was some other strategy at work, PDI would not have made such efforts,” Mize said. “There are no plans yet in place to significantly throttle software development relative to the Pinnacle products in the immediate term. We’re going to continue supporting clients; we’re going to continue resolving issues that might arise; and we’re going to continue to offer enhancements to some degree. That has not changed.”
While there is no immediate plan to shuffle Pinnacle customers to the PDI platform, the acquisition provides a range of synergies and opportunities in the long term.
“Pinnacle and PDI have competed head-to-head in the retail c-store and wholesale fuel space for quite some time,” Mize said. “So, as you would imagine, there’s a fair amount of overlap, and I believe there will be a reasonable amount of edge functionality that we can take advantage of with each other’s solutions.”
Undoubtedly there will be an eventual convergence of the platforms, but Mize noted that lies some distance in the future. “Of course, as we get further out will be taking a look to see where we can leverage synergies so we’re not doing the same things in multiple product lines,” he said. “That’s going to take some time to get further fleshed out.”
As for industry veteran Mize, “I’m excited about the opportunity to shepherd this process, and I think it’s loaded with opportunities for Pinnacle clients, employees and for PDI. And ultimately, I think there are huge benefits to the industry as a result of this transaction.”