Product Run Out – If you’re in the business of pumping fuel into cars and trucks for profit, those are the last words you want to hear. Let’s face it—you can’t sell what you don’t have. That doesn’t even cover the bad feelings generated for a customer that pulls up at your pumps and you’re out. They may never come back.
By the same token, the traditional solution to the problem— ordering your fuel supplier to keep the tanks full at all times– adds unwanted cost to your bottom line. When prices are falling, a product with low turnover can cost you more to sell than it should. That load of midgrade you bought today could be 5-cents per gallon cheaper next week.
The ability to quickly and effectively adjust buying to accommodate price swings and still ensure you don’t run out should be the goal of every marketer selling fuel. This concept is already the cornerstone of convenience store retail inventory management. Every square inch of shelf space is accounted for in the battle to keep inventory out of the back room and maintain just-in-time deliveries. Pinnacle has a whole suite of operational and business intelligence tools dedicated to managing merchandise inventories (EPM™, Item Level Inventory, and Computer Assisted Ordering as examples). So, why don’t you do the same for fuel inventory, the most expensive and volatile product you carry?
The good news… you can; including mobile inventory monitoring and dispatching—with Pinnacle’s Fuel Solutions.
At the heart of the system is Fuel Smart™. It takes a snapshot of inventory from each location at the beginning of a day and uses this data along with historical sales trends to forecast fuel inventory needs for the next day or so. From this, Fuel Smart will recommend purchases based on your ordering specifications and at the lowest cost available (including all taxes, fees and freight). Fuel Smart allows you to configure your ordering specifications to target inventory levels based on market direction, at the individual fuel product level for each location. As examples, when fuel prices are trending up you may want the target number of days of midgrade inventory to be higher at one or more stores; when prices are trending down you may set a condition to keep the tanks less full. You can control the number of days’ sales in inventory, the method of predicting future sales, and the minimum tank level for each and every product and location in your company. These preset conditions can be enabled on a daily basis to influence the recommended loads of fuel that Smart Buy™ suggests. And for each buying area (Fuel Smart “Terminal Group”), you can trigger a different set of conditions for when fuel prices are rising, falling, or are relatively stable.
Using Fuel Smart, you can manage inventories at a level that maximizes your profit by making sure you buy when it makes sense and not simply to prevent the dreaded run out.
