Wet stock might not make you the biggest profit margin on your site, but it definitely brings in the punters. However, in these days when the shop is the margin maker it can be overlooked and unidentified leaks mean any profit you could be making is running away.
"Having a proven wet-stock management system in place can make the difference between guessing and knowing what’s happening to your fuel stocks," says Matt Clayton, UK sales director at Gilbarco Veeder Root (GVR).
GVR’s web-based Fuel Management Services (FMS) provides retailers with full wet-stock reporting and analysis as well as remote management of alarms. It identifies losses such as the effects of temperature or over-dispensing meters and quickly detects the source of leaks.
The service runs 24 hours a day, seven days a week. "We’ve helped our customers identify tank and line leaks before they became serious, highlighted delivery issues and given clarity to many other reconciliation anomalies, such as ’lost’ litres due to temperature variance," says Clayton. "Traditionally this would have been put down to over-dispensing meters and in some cases we’ve seen, has been incorrectly diagnosed as a leak. FMS was able to avoid costly investigations in an attempt to locate something that didn’t exist."
The European Biofuels Directive states that all EU countries should have 5.75% minimum biofuel content as a proportion of all transport fuels by 2010. Clayton says this will bring new challenges to forecourt operators.
"Ethanol fuels are prone to holding water in suspension. Over time phase separation can occur, which means the water/ethanol mixture can separate out and collect at the bottom of the tank.
"Separated emulsion will cause vehicle breakdown and engine damage if dispensed, which leads to cost liabilities for operators. We are developing phase separation detection features to augment our range of TLS Monitoring Systems. These new features will help prevent claims for damage due to contaminated fuel and enable preventative actions. They will start to become available during 2010."
GVR’s phase separation detection will work on three levels:
? level one - detect separated ethanol/water emulsions before there is any danger of dispensing;
? level two - measure height of separated ethanol/water emulsions;
? level three - report ethanol content and water content before phase separation occurs.
"Measuring density will also be added to the capabilities of the TLS Monitoring System later this year. Density can be a useful indicator of fuel quality and help to identify if the wrong grade is in a tank. The density feature will add another level of information for fuel retailers to manage their stock," says Clayton.
In the UK there are no specific regulations for wet-stock management, however there are inherent environmental and health and safety issues, and operators are responsible for managing their risk. One of the most serious concerns is around releasing fuel to the environment.
"We help our customers with managing the risks of leaks," says Clayton. "One of the most critical aspects of managing risk is early detection. The automated leak detection features and active sensor monitoring of the TLS System together with the FMS can provide the earliest indicator of a fuel leak."
Greg Salverson, director of solutions engineering at FuelQuest, reckons environmental concerns and increasingly stringent regulations are putting the spotlight on a new breed of technological advances for forecourts. "But which products are breakthrough technologies that reduce costs and which products are merely expensive upgrades with a marginal return on investment?" he asks. "Options include implementing new gauges, leveraging software systems to streamline reporting, and utilising on-site alarm management.
"New gauges provide accessible, automated compliance with on-site reporting including historical compliance reporting, which provides records in the event of an inspection by local authorities. In addition, new gauges can yield lower cost of maintenance with alarm management, which routes alarms to the appropriate personnel for resolution. While it is beneficial to have better reporting, this does not typically justify an expensive hardware upgrade. Software companies provide out-of-the-box reporting by monitoring all gauges, old and new, to prove compliance. As a web-based system, Fuel Management Systems (FMS) are available on site with historical reporting."
Salverson reckons the beauty of interfacing to software solutions and leveraging existing hardware is that, as regulations evolve, software changes with them. "A good example of this is the seemingly constant changes around inventory reconciliation. As different jurisdictions require differing alarm thresholds, it’s nearly impossible for a hardware solution to keep pace. We have been able to deliver compliance with these evolving regulations as they occur, often saving customers fines, fees and penalties. Once existing hardware is ’connected’, the advanced capabilities can be leveraged such as demand forecasting, truck scheduling, and even financial reconciliation."
He says another option is on-site alarm management, which requires a technician.
"It’s a nice feature but it requires trained personnel to triage the alarm to take the appropriate action. Ignoring the alarm increases your risk of an issue going unnoticed. And always paying a technician to investigate the alarm increases your costs. Centrally managing alarms with certified personnel ensures you only pay a technician, properly equipped to resolve the issues, for alarms that require on-site investigation.
"Most companies are looking to better utilise the features of their existing gauges through software applications. Often, existing gauges can monitor compliance events for reporting and generate alarms, but companies are not employing these features because they aren’t connected to the gauge. Upgrading to a network really takes alarm management to the next level because two-way communications allow a certified central alarm management team like FuelQuest Alarm Management Services (AMS) to connect to the site and use their training and experience to remotely document and close alarms that do not require an on-site technician; this Alarm Response Protocol reduces maintenance costs by up to 40%."
Meanwhile Edensure managing director, Martin McTague, reckons his company’s ES3 system’s advanced technology enables you to identify some of the key causes of lost product in your forecourt by quickly identifying leakage and over-dispensing. "The system alerts you to the problem quickly enabling the issue to be dealt with. In addition to monitoring your business the speed and accuracy of ES3 means we can also include a comprehensive pollution insurance policy as part of the service.
"It will give you transparency in key operational areas of your business identifying opportunities through delivery data, sales data, leakage data allowing businesses to maximise their profit.
"Research shows that 60% of losses come through delivery issues whether that’s through hot product, vapour recovery or poor measure - and 35% through sales losses - dispense calibration, theft and test errors.
"We can monitor any fuel movement that could contribute to these areas. Our system monitors the product level, dispense, sales, temperature, water level, ullage and days to empty.
"The tank gauge software accurately checks deliveries providing greater supplier accountability. The meter drift software detects and measures over dispensing to reduce sales losses - this alone is worth up to £6,000 per site per year."
He continues: "One final benefit we can deliver is a market-leading insurance package. The package protects the retailer against any cost of clean up and protects the asset value of the site. Retailers who install our system benefit from significantly lower insurance premiums."
Finally, HTEC’s slogan is ’Get Data Smart’. The company says that most solutions collect data but it is what you do with it that really makes a difference.
HTEC Virtual Back Office provides real-time wet stock control, reporting and analysis tools which are said to improve both efficiency and profitability. Both forecourt customers and third party service providers can use the data to improve their businesses using the real-time information. Creating trend analysis on sales and wet stock levels maximises the investment made in automatic tank gauges and monitoring devices improving both efficiency and profitability.
HTEC is also able to help provide end-to-end integration with logistics systems including predictive algorithms to plan and optimise fleet management and fuel deliveries. Using real-time gauge data to alert where sites will run out of fuel in the next six trading hours allows bulk purchasing and huge efficiencies in tank replenishment.
The company says that using data effectively also provides huge dividends in times of crisis such as the Shell strike in Scotland and the recent terminal issues seen in the south west, both of which affected the availability of fuel. Customers are able to maintain supply in times of shortages by improving communication within the supply chain and reacting quickly to forecast shortages in key locations.
=== Case study: Jet, Bonnybridge ===
A Jet site in Bonnybridge, Scotland, which was the first forecourt in the country to install a full set of Standard Temperature Accounting (STA) pumps, has already seen big improvements in its wet stock losses. In just six months of operation, its stock loss has virtually disappeared.
The pumps, which are standard practice in Canada and Belgium but still a rarity in the UK, compensate for temperature differences in fuel and provide a ’standard’ litre, whereby fuel is sold according to what its volume would be at 15°C. This gives retailers greater control over their stock losses and ensures that customers get the same value of fuel each time they fill up.
Jimmy Beveridge, owner of the Jet site in Bonnybridge, says: "Wet-stock loss is such a huge issue for the industry, and we were certainly no exception to this, constantly suffering the effects of fluctuating fuel temperatures. However, the difference the STA pumps have made is beyond all our expectations, and we couldn’t be happier."
Jimmy says STA pumps are just one of the recent upgrades he has made at the site.
"Other changes include new eco-lighting across the entire site, a state-of-the-art CCTV system to assist with the ongoing battle with fuel run-offs, and a cardboard compressor to cut down on total waste generated - all of which are already making a big difference to our bottom line, as well as lessening our impact on the environment."
=== Case study: mrh (gb) ===
MRH (GB) - number one in Forecourt Trader’s Top 50 Indies list 2009 - has implemented Fairbanks Environmental’s ibank real-time wet stock monitoring system across its entire network and has also implemented Blue Fin’s Premises Pollution Liability insurance.
MRH opted for Fairbanks’ service to minimise the risks of undetected leaks and will also benefit from Fairbanks’ on-site services.
But it is not just leaks the Fairbanks’ system identifies.
All abnormal variances, including over-issuing dispensers, are highlighted and, as approved verifiers, Fairbanks can identify, adjust and verify dispensers that are showing abnormal variances.
Malthurst and Fairbanks have been working together since 1997 and this latest contract is said to provide unparalleled levels of protection.
Fraser Duffin, property manager at MRH (GB), comments: "As the MRH network grows we need to ensure that we have procedures in place that reflect the standards we are setting ourselves.
"We believe that the combination of our own internal processes, Fairbanks’ leak detections system and Blue Fin’s insurance cover takes us a long way towards achieving those aims."