Lease Purchase Fuel Management Strategies

Discussion in 'Lease Purchase Trucking Forum' started by Aminal, Aug 14, 2014.

  1. Mr. Mister

    Mr. Mister Light Load Member

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    On a happier note, I'm getting my fuel card and will be handling my own fuel purchases independent of my lease.

    Better fuel discount means more money in my pocket.

    Pathetic for a company to swipe a lease op's fuel discount when it's our largest expense.
     
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  3. ew2108

    ew2108 Road Train Member

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    how does a company benefit from taking a fuel discount
     
  4. Mr. Mister

    Mr. Mister Light Load Member

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    They're paying a lower rate for fuel, then charging the driver a higher price than what they pay.

    Let's see... buy low, sell high... sounds like capitalism. Normally I'm for it, but when it comes to playing with my settlements, I'm stingy.
     
  5. ew2108

    ew2108 Road Train Member

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    Got you that makes sense and is dirty!!!
     
  6. Mr. Mister

    Mr. Mister Light Load Member

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    Eh, I guess they justify it by paying the IFTA, but I'd rather control my own fuel costs directly.

    They'll still pay the IFTA. That's in the lease. Using their fuel card isn't.
     
    ew2108 Thanks this.
  7. Aminal

    Aminal Heavy Load Member

    OK. Back to strategy. Been busy, but found time to run August's numbers as above. So far, so good on buying lot's low and splashing just enough high to get to a low. It has pinched a few settlements pretty good but the next were high so overall it affected weekly cash flow but not monthly and I'm pleased with the net effect. So far here's how August looks w/ some real numbers. First, this month I have run: FL, GA, AL, MS, LA, TX, NM, AZ, CA, SC, NC, TN, KY, AK, MO, KS, OK, IL, IO, NE, WY, UT & NV. Fairly divergent pricewise but didn't run the northern tier and New England.

    My price per gallon as a function of strictly all the money I spent at cash price (no rebate) divided by all the gallons I purchased is $3.616/gallon for August. The DOE National Average published this week was $3.821 which is down from $3.853 the first week of the month. So, so far this month I'm beating the National Average by $0.205/ gallon just cash price. If I factor in the nickel rebate I got for all my fuel except 20.2 "oh crap" gallons at a Wilco in SC because I pushed it too far getting home and had to get some ASAP, the numbers are: $3.567/gallon which beats National Average by $0.254/gallon. I can't complain about that.

    Did it pinch two settlements? Yes. But I started the following weeks with 3/4 tank of cheaper fuel so I didn't buy as much that week period. High or low price; instead of starting the week low and having to get more that week. This method seems to cycle in two week (settlement week - not calendar week) periods. One low, next higher, next low, next higher. I don't know how it would have affected my settlements or my overall numbers if I had held off on a big purchase at a low price stop to get more on that settlement, but had to get more at a higher priced stop than I would have the other way. I haven't tried it. But the numbers tend to suggest I'd have less fluctuation in my settlements but my settlement would be the same for the month and overall cost for the whole month would be higher.

    My fuel expense percentage this month as strictly a function of all the dollars I spent on fuel and all the revenue for the month is fuel expense was 28.35% of my gross revenue so far this month. Now we still have 5 days left in the month but I feel pretty sure my numbers will stay right about where they are. If they go up or down I doubt it will be a full percent. So. Why is this important?

    MPG is pounded in our heads all the time. Look at MPG as a performance measure, though. It reflects the machine and driver's economy in how well is the machine running fuel efficient wise and how well is the driver doing with driver performance for economy (speed, shifting, not idling, etc.). Think of it like: How well is the driver/machine running. Your overall cost per gallon and what percent of the gross revenue your fuel expense is; is a measure of your purchasing performance and how well you are purchasing. You can have great MPG but if you buy fuel like a company driver (fill up every time you fill, at whatever truckstop is your favorite for driver rewards, parking, restaurant etc.) it will show up in your expense percentage and overall cost per gallon and ultimately (which is what really counts) your settlements.

    Conversely you can have average or a little low MPG but great Purchasing and still do OK. But to knock it out of the park and reach the irreducible minimum expense (which is money that stays in your pocket and goes straight to your bottom line) you have to look to the immediate (your MPG) and the long term (Purchasing) and you have to do whatever you can to keep the MPG's high and Purchasing low. There is no "right way" to do it. The "right way" is the way that works for you and your personal situation and rig. Every person has a different cash flow need, and even fleet sister rigs from the factory perform a little differently. You have to do whatever works for you. I'm simply sharing what I do and it may or may not help you. I can't complain about how it's working so far, though.
     
    ew2108 and Mr. Mister Thank this.
  8. Mr. Mister

    Mr. Mister Light Load Member

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    I just ditched Wells Fargo because they refuse to support ACH transactions, which I need in order to make payments on my fuel card.

    Instead, I signed up with Chase and got ACH and free wire transfers on my business account, free checking, free savings, no fee traveler's checks, no fee cashier's checks, no fee money orders, and I'm sure there's other goodies I'm not mentioning.

    I'm glad I keep my DD-214 handy, they treat veterans right.
     
  9. Mr. Mister

    Mr. Mister Light Load Member

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    Hey Aminal... read 'em & weep:

    [​IMG]
     
  10. 6 Speed

    6 Speed Heavy Load Member

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    Five days driving on flat ground?
     
  11. Brandonpdx

    Brandonpdx Road Train Member

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    Ehh...cant you just buy your fuel at TA or Petro or any of the large chains, get your fuel discount and free shower and not worry about whether you spent $10 bucks more than you should have? I mean fuel is usually going to be similarly priced in whatever region of the country you're in so some of these strategies seem kind of nuts. (Some bean counter-turned-truck-driver's head just exploded when they read that, lol.)
     
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