More Petroleum Retailers Employing Price Optimization
FLORHAM PARK, N.J. — Price optimization continues to gain popularity for establishing optimal pump prices by market or individual sites, according to a Kalibrate Technologies plc survey released Tuesday.
The third-annual survey involved executives representing more than 8,000 fueling locations that sell 10 billion gallons annually. The number of respondents citing that they use price optimization "always" or "sometimes" continues to grow, the survey revealed. For the third year in a row, the primary reason for employing price optimization is to increase margin while maintaining or increasing volume/market share, depending on the retailer’s market strategy.
Convenience store retailers also continue to rely on third-party fuel price optimization software vs. in-house systems. Sixty-two percent of the respondents said they prefer to purchase price optimization software from a third-party provider, according to Kalibrate.
In addition, convenience store retailers have a growing interest in creating strategies for pricing alternative fuels, the latest Kalibrate survey revealed.
"While retail fuel pricing is a critical component for ensuring profitability, more and more companies are realizing that it is only one of seven elements that can ensure volumes are maintained and profits increased; it’s what we call the 7 Elements for Fuel Retail Success (price, location, market, merchandising, facility, operations and brand),” said Bob Stein, president and CEO of Kalibrate. “Careful attention to all seven elements is the answer to overall site success and withstanding competitive threats.”
Florham Park-based Kalibrate Technologies plc offers a wide variety of strategies and technology solutions for retailers.