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Directing Fuel

For Brian Skillern, each workday starts between 5:30 a.m. and 6:00 a.m., reviewing numbers to check on each store’s fuel supply. As the director of fuel transportation, fuel pricing, fleet marketing and truck stop sales, he spends his first hour each day recapping the previous one, and running reports to review the current numbers for both pricing and supply. His first meeting of the day starts at 8:00 a.m.

"Every morning I walk next door to the supply department to see what opportunities we have or problems that need to be solved, like rerouting trucks," said Skillern. "My job has a lot of planning tied to supply in every market, and making sure we are balanced."

It takes a lot of analysis to keep everyone informed on the status of supply, price changes and the areas where the company is doing well, he explained. Skillern deals with product specification, quality and components of the fuel, such as octane, vapor pressure and whether to blend or not blend ethanol.

"We have 3,600 underground storage tanks, and we can't put the wrong product in the wrong tank," he said, explaining Valero works with 17 contracted carriers, and he is responsible for their performance, while also negotiating contracts and monitoring compliance.

"We monitor them to make sure we get what we paid for, and that it goes to the right place," he said. "Right now, unleaded is at 1.7 tank turns a day, while premium and diesel are not moving as fast. I look at the deliveries, if they were on time and if they delivered too much or too little."

His role also requires dealing with legal compliance, government inquiries, contract variables and more, and he manages five direct reports, including an employee who manages the fuel carrier, and a full-time analyst who makes sure costs are accurate.

"I work with smart, talented people who make my job easier. I make sure we are optimizing our network from a volume and margin standpoint," said Skillern. "If there is a gas problem, a cost issue or a competitor issue, they call me. If they never call me, then I know life is good."

The company uses a proprietary retail fuel pricing system that offers historic data, and is useful as a tool to look back, he said, explaining he runs a month-to-date report card comparing current figures to the previous year. And he also looks ahead.

"We have a forecasting system for supply planning from market to market, and we track competitors' pricing by region, market and store," he noted. "I work with regional vice presidents and zone managers to offer guidance on what the market might be doing."

Running reports and looking up numbers are a major part of his day, and when CSNews visited, the company was preparing for a shareholders meeting. At one point, Gary Arthur, Valero's retail division head, stopped in for data, and within moments, Skillern had the information he needed. "In this job, you need to know your stuff," he said. "I need to know my numbers and be able to make decisions quickly."

In addition to monitoring the company's own pricing and supply, Valero assesses the strengths and weaknesses of all its competitors' stores based on what it believes is important to the customer, and Skillern then optimizes a strategy and tactic to capture more sales and profit.

"If we can optimize margin by a penny, it could mean $20 million to the bottom line, a big financial impact desiring all the effort," he noted.
Skillern has worked in the convenience and petroleum retailing industry for 33 years, and three years ago, he ran the western region as the director of operations. The biggest challenge Skillern faces is the volatility of the market, which makes it hard to control costs, he explained. But the challenges are actually his favorite part of the job.
"It's different every day," he said. "Some days are easier, some are harder. Sometimes I get calls on nights and weekends if we have a supply problem or logistical issues, and one phone call to me can equal 10 phone calls I have to make. But it comes in spurts."

-- Has been with the company for 33 years.
-- Moved into his current role three years ago after managing Valero's western region.
-- Skills needed for his job: an analytical mind, marketing and business
education, operations experience and good communication skills.
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