“What we learned from hurricanes Harvey and
Irma is that, to secure the fuel you need, having a
combination of robust supplier relationships and
real-time price and allocation information gives you
an advantage by saving you time and effort when
securing product and improving margins when you
turn around to sell it.”
credit terms with these suppliers in advance is important and,
if you don’t, knowing what steps to take to get them is an essential next step. Almost every fuel contract will have a force
majeure clause – so make sure you read the fine print and are
aware of your supplier’s contractual intent for when a natural
Furthermore, it’s important that your relationships with
suppliers, whether in your standard location or in the surrounding areas, are developed enough where you can reach them
after hours. In the case of a major supply disruption, like that
of a hurricane, that you can reach them outside of standard
business hours to confirm your allocations – or at the very least
– learn that you need to load product elsewhere so you can
plan truck times accordingly and in a timely manner. Sometimes
even more important is that you make yourself available so that
they can reach you to confirm allocations or warn of a supply
disruption. You would hate to have your suppliers trying to get
in contact with you to share critical supply information without
an efficient way to get a hold of you.
One thing is certain when trying to secure fuel during a tight
supply market – seconds count. For wholesalers and marketers,
it’s important to be equipped with technology that makes the
most of your precious seconds.
Advanced technological solutions can help you to immediately identify where product is available and where you have
allocations. Your price discovery tool should show you prices
not just within your immediate area, but in any geography
where you may pick-up product. They should also allow you to
easily see prices, and where you have allocations available – all
on one screen. During a crisis, you may very well be picking up
product several hundred miles away. It’s important in these
situations that you calculate-in transportation costs to price
your product correctly. Did you know an advanced price discovery tool can automatically calculate freight costs for you?
Along with real-time price information, supplier communication
is also key.
Seconds most certainly count when communicating with
your suppliers. In the case of terminal outages, receiving immediate notifications for outage updates for your suppliers can
save you precious time from calling around. In addition to
notifications, you want a real-time view of allocations. Suppliers
that use an online, real-time product allocation portal not only
set themselves apart but make the lives of those loading much
easier – especially when there are outages in certain areas.
Critical weather updates are another benefit of an advanced
price discovery tool. Do you have a solution that alerts drivers
to severe weather conditions such as wind, rain and hail? Having
your drivers notified when dangerous weather is within a certain
number of miles to them helps keep your carriers, and your
When equipped with the right technological solutions that
can identify where you have product available, especially during
times of severe weather like we saw with hurricanes Harvey
and Irma, securing the fuel you need becomes much easier. It
also helps keep your drivers, and your product, out of unsafe
driving conditions with targeted weather alerts for your trucks.
But, securing the product is only half the battle.
ONLY HALF THE BATTLE
Once you secure the fuel, capitalizing on having that product
by selling it quickly to your customers is critical. To do this
effectively, access to real-time spot ticker information is critical.
Savvy marketers watch this information closely in tight supply
times to see if it is ticking up or down. Having your finger on
the pulse can tell you when you should pull loads to get the
best price. For example, if the spot ticker is rising, your sales
team has the ability to sell additional fuel by recommending to
clients that they buy an extra load today to avoid even higher
prices tomorrow or in the coming days.
Does your sales team in the field have immediate access to
pricing data? For the most profitable margins, it’s important
for them to have real-time, mobile access to this information
so they can give potential customers a price on the spot, and
secure a deal.
Securing fuel in times of tight supply is a challenge faced by
wholesalers and marketers alike. What we learned from hurricanes Harvey and Irma is that, to secure the fuel you need,
having a combination of robust supplier relationships and real-time price and allocation information gives you an advantage
by saving you time and effort when securing product and improving margins when you turn around to sell it.
In the event of a hurricane or any other supply disruption,
being equipped with advanced technological solutions can
better prepare you to secure and sell fuel with confidence.
ABOUT THE AUTHOR
Loretta Terranella is regional sales director for DTN.
She has worked in the petroleum fuel distribution
industry since 2001, where she has held positions
with both Commercial Fueling Network and Advantage Energy Systems. DTN provides price notification, business document delivery, market
intelligence, and business transaction support to North American refiners and refined fuel marketers.