Opportunity to improve profit remains top reason for investing in fuels pricing software.
Kalibrate, provider of strategy and technology solutions to the global fuel retail industry, announced the results of its third annual global fuels pricing survey comprising feedback from executives at retail petroleum companies representing more than 8,000 sites selling 10 billion gallons annually.
The study reveals a continued preference for third party fuels pricing software versus in-house systems, with 62% of respondents relying on a third-party provider.
The opportunity to improve profit continues to be the main reason given by respondents for investing in fuels pricing software. This has been a consistent finding in each of the past three years. Other reasons cited in the 2014 survey include a deeper focus on business analytics, customization that supports unique business requirements and integration with third-party systems to decrease the time to implement price changes at the site.
Price optimization also continues to gain popularity for establishing optimal pump prices by market or by individual sites. The number of respondents citing that they use price optimization ‘always’ or ‘sometimes’ continues to grow. For the third year in a row, the primary reason for employing price optimization is to increase margin while maintaining or increasing volume/market share, depending on the retailer’s market strategy.
“While retail fuel pricing is a critical component for ensuring profitability, more and more companies are realizing that it is only one of seven elements that can ensure volumes are maintained and profits increased; it’s what we call the Seven Elements for Fuel Retail Success (price, location, market, merchandising, facility, operations and brand),” said Bob Stein, president and CEO of Kalibrate. “Careful attention to all seven elements is the answer to overall site success and withstanding competitive threats.”
This year’s survey also revealed a growing interest in being able to create strategies for pricing alternative fuels. With macro forces and consumer awareness increasing the viability of alternative fuels, retailers are looking for strategic perspective and solutions to better price alternative energy.
