The days of continually raising prices to maintain profits are long gone; survival in today's cutthroat market demands streamlined operations and competitive pricing models. Keeping customers can be as simple as offering the RIGHT pricing program...
When you look out into the yard during the summer, what do you see? Trucks, lots of trucks. Some are out making deliveries, but the rest are there just sitting there, waiting. Trucks are the backbone of your business, and you wouldn’t survive without them BUT do you really need all of your trucks?
Your biggest expenses are the fleet that delivers fuel to your customers and the wages for the drivers, dispatchers, and mechanics who make those deliveries and keep the fleet running. In many cases, those expenses can equal 75% of all of your operating expenses. You are (or should be) aware that there are new and modern ways to improve your economics. The costs are minimal relative to the benefits, the implementation is fairly easy, and the results outweigh just about anything you can do with any other delivery and dispatch technology.
Weather hedging (for fuel dealers) can best be described as a method to recoup some level of the lost fuel delivery and service profitability that otherwise would have been earned in a warmer than normal winter. They are financial derivative tools designed to counter that hackneyed refrain of helplessness we so often hear: “Hey, we can’t control the weather.”
In any business, in any industry, the “3 legs” that are required to support a business are Sales, Operations, and Finance. Sales can include sales, marketing, customer support and retention, data analytics, social media, etc. Operations includes “everything you do” to serve your customers. In our industry, it is primarily delivery of fuels and the installation and servicing of heating and cooling equipment. Finance includes everything from budgeting, analyzing, reporting, banking, credit, hedging, and more.
