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sharing the supply chain story, as well as
the issues that negatively impact lifecycle
performance for diesel-powered equip-
ment and heating oil systems. This small
group of companies is choosing to innovate
and solve problems for those who want
to be their long-term business partners.
Mastering downstream activities has and
will continue to allow these organizations
to build new forms of customer value and
lasting differentiation.
When asked about the market research
that went into the very device on which I
am writing this article, my iPad, Steve Jobs
replied, “None. It’s not the consumers’
job to know what they want.” Distillate
consumers connect to the “price is king”
mantra because we put that thought in their
minds. “The tail is wagging the dog.” Not
enough is being done to educate customers
on the challenges associated with supply
chain processes and its impact on our fuels.
The lack of product differentiation encour-
ages competition. You can stay ahead of the
competition by continually redefining your
brand and introducing new criterion of
purchase. With that, let’s talk supply chain
and its impact on fuel quality.
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Managing fuel costs has always been
a top priority for fleet managers. They are
vigilant to make smart buying decisions
and evaluate fuel management strategies,
including right-sizing their vehicles; using
GPS tracking to reduce vehicle idling;
ensuring fuel card compliance; educating
drivers about fuel-efficient driving; utilizing
fuel hedging programs; and more.
Through it all, oil prices remain volatile.
Conflict in oil-producing countries has con-
tributed significantly to this volatility, echoed
by Wall Street’s real-time response to each
supply tremor. You need not go far to recog-
nize that fleet management professionals are
concerned about volatility and committed to
identifying and implementing strategies to
alleviate the consequences on the bottom line.
The breath of fresh air in all this clearly is the
nation’s emergence as “king of crude supply.”
The U.S. is now exporting more product than
importing for the first time in years.
Today’s fuel quality must be discussed.
For home heating oil distributors con-
tinuing to stem declining market share,
you must eliminate sedimentation driven
by storage duration and temperature. Keep
fuel fresher longer, mobilize sedimentation,
protect fuel systems from corrosion and
teach your customer about the inclusion of
biodiesel in today’s blends.
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For the fleet customer, common rail
fuel injection issues have become front
and center. Fleets operating on these high
pressure and temperature platforms are
wrestling with reduced filter life, reduced
fuel consumption and premature injector
failure. If you have been fortunate enough
not to have endured these series of negative
consequences in your own fleet or those
that you serve, it’s a matter of time.
For stationary generator owners, it’s
all about reliability; when they turn that
system on, it better go on. If you think gen-
erator fuel quality is not important think
about Hurricane Sandy necessitating the
evacuation of a New York hospital, compro-
mising the health and safety of hundreds
of individuals last year. Then there is the
controversy about ultra-low sulfur diesel
and its negative impact on fuel dispensing
systems nationwide through corrosive
attacks. Are these issues a figment of our
collective imaginations? Not likely.
It’s easy to believe that customers want
only the lowest-cost diesel, gasoline and
heating oil, but we need to look beyond
the assumption. We previously assumed
and frankly often believe that price is the
only important factor in the markets that
we serve. Reflecting back to when this 10
billion-gallon heating oil industry was
vibrant and contrasting it to now, hovering
around 5 billion gallons if you add residen-
tial, commercial and industrial, says it all.
To check the numbers for yourselves, visit
and view the volumes of
diesel and heating oil being consumed on
your marketing footprint.
Although diesel fuel sales nationally
weigh in at 38 billion to 42 billion gallons
and remain the workhorse of the trucking
industry, you’d better take a look over
your shoulders at the progress compressed
natural gas has made converting diesel
trucks, especially in the refuse industry.
Trucking companies rely on you to guide
them to operational excellence both on the
road and on their bottom line.
We owe it to customers to share what
we know about the evolution of equipment
and fuel quality. Our job is to make them
aware that the deficiencies are real, and
while educating them, to give them choices
so they can buy the absolute best product
at the most competitive price.
What makes 162 the
“magic number” for
oil deliveries?
We go
beyond the numbers
to
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