How it all began
My name is Glynne Suckling and I am the General Manager of The Buying Group Limited. I joined Mobil back in 1987 as a “wet-behind-the-ears” administrative assistant. Not even 17 years old, I certainly was the baby of the company.
However I learnt fast. Over the years that followed I worked in many different departments, but spent the most time in Retail Fuel. It was here that I got a deep knowledge and understanding of how various oil company pricing methodologies worked.
Fast forward a few years when I joined The Buying Group. I immediately saw that we didn’t have a Fuelcard category we could offer our clients so I used my past experience at Mobil to put something together. With my contacts, I was able to negotiate a fabulous discount structure that was significantly better than what any other fuel company was prepared to offer a fledging buying group.
Over the next couple of years, we had a lot of success with our Mobilcard offer, picking up clients all around NZ and growing our fuel volume quickly.
But there were some dark clouds on the horizon.
A Change in Supplier Strategy
We noticed that Mobil was starting to close or sell a growing number of their outlets creating holes within their network. Then the company started a cycle of regular restructures, cutting staff throughout NZ and moving support functions overseas.
We realised that if Mobil continued following this path then our Mobilcard offer would weaken. The icing on the cake was when they started reducing their discounts.
However they weren’t alone by this stage – all of the oil companies had started a similar process and were progressively working through similar strategies.
Malcolm and I reviewed our options and considered the following issues:
- fuel is a commodity with minimal added value;
- clients want the cheapest price;
- they don’t want to have to travel out of their way to purchase it;
- but whilst the above is true, they resist changing oil companies due to the perceived “hassle factor”.
We decided to make fuel an exception to our normal strategy of one supplier per category. Instead, we would approach the remaining oil companies to negotiate discounts with the intent of having all the big four available to our members. And that is exactly what I did.
A New Fuelcard Solution
Over the following 18 months I put in place discounts with Shell, Caltex, BP, and Petroleum Logistics (who purchased BP & Shell’s Marine pumps). At the same time I built a new fuelcard billing platform that enabled us to issue cards from each fuel company, consolidate all our members transactions with the oil companies, and just issue one invoice for each member regardless of which fuel company card they used.
Our members now pick and choose which cards they will use based on which fuel company is cheapest and convenient for their location. And at the end of the month, they get just one consolidated invoice.
We now have access to five fuel companies pricing – BP, Caltex, Mobil, Petroleum Logistics, and Z Energy (Shell). We have been tracking their pricing for years and we know immediately when they change and which fuel company is the cheapest for each region of NZ.
Recently, Mobil has significantly improved our discounts and has re-emerged as one of the best options. These new discounts are automatically passed onto our members.
The fact that the fuel companies use different pricing methodologies only makes it confusing when trying to compare pricing, but we have developed a system that tracks it all.
So would you like to know which fuel company is the cheapest for your region, based on our pricing?
If you are interested in finding out which of the fuel companies is the cheapest, then please enter your details below and I’ll email you my report “Fuelcard Pricing – How fuel companies price their fuel and which one will save you the most”.
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