Two Ways to Manage Today’s Major Fuel Allocation Woes
Around the world, refined fuels suppliers and wholesalers are feeling the pinch of managing allocations in an environment of continued tight supplies and unstable demand. Let’s take a closer look at their unique, but intertwined challenges and explore how innovative allocation-focused solutions can help preserve precious profits and alleviate ample frustrations.
With market supplies tighter than ever, many suppliers are relying on run outs to avoid excess inventory. This trend isn’t entirely surprising given the instability of the demand landscape.
Unwanted product is expensive, but dead-head turnarounds are the kiss of death to ratability, so it’s critical that when a supplier does have available product, they communicate that information with potential lifters in a timely manner. But it is equally important that only the intended customer sees the appropriate details. You can’t just broadcast, “Hey, I have gasoline; first come, first served.” No, wholesalers looking for specific products to meet their markets’ demand are the correct audience — and even then, only the ones with available lifting privileges. While ratability is a priority, so is profit. Tracking down over-limit payments reduces office staff productivity, eating into already-thin margins.
Even in the best of circumstances, properly supporting customers takes considerable effort. Customers must be tracked by credit, location, product, and other key details. But product can also be tracked by customer, volume, or price. If that sounds like a recipe for confusion, it is. Even when supply is steady, mistakes happen, leading to ratability declines. In this inflationary, recession yes/no environment, it’s even harder to accurately maintain customer accounts.
All of this can lead to frustrations for customers who thought they had product available to lift. Dispatching trucks only to have them denied can have a ripple effect, creating lost profits. Those wholesalers will need to deal with angry customers of their own — and some must also manage the potential backlash from regional franchisees willing to take their business elsewhere.
For wholesalers, the scramble to find product is distressing. Much time is lost on repeat phone calls, portal visits, website searches, and emails. What’s more, demand can appear to surge in one area, only to die off suddenly. Wholesalers need to know precisely what product they have access to, how much, and where it is. In the current dynamic demand environment, they simply cannot afford to dispatch trucks in the hope that they’ll come back loaded; they must be sure.
A better way
Now more than ever, clarity is key for both suppliers and wholesalers — fortunately, there are solutions designed to deliver it. For suppliers, we offer DTN Allocation Tracker™, which allows instant communication of credit and product availability to specific customers in a secure environment, improving ratability. For wholesalers, DTN Allocation Viewer enables them to quickly see which products are available, how much they can lift, and where it is located — saving time, money, and hassle.
Not only do these solutions help their respective parties protect the bottom line, but they can also help strengthen vital partnerships through better communication and more accurate expectations.
If you’ve been looking for a solution to your allocation woes, get in touch with DTN today.