How do I reduce fuel costs for my business?
Carriers • Published on May 6, 2021
Purchasing diesel fuel is one of the biggest expenses for any trucking company. With gas tanks holding roughly 300 gallons, the cost of diesel adds up. No matter the size of your operation, it is important to understand your options for purchasing fuel, and crunch the numbers to minimize your costs. Depending on what method you use to buy fuel, the price you have to pay can vary widely. With the huge amount of diesel carriers purchase each year, getting a top discount can lead to thousands of dollars in savings per truck each year. So, what is the best strategy for saving on fuel? To know that, it is important to know why fuel prices can vary so much at a given station.
Market Rate for Fuel
Fuel stations have a market rate for selling fuel. Typically, that rate is reflected in the cash price listed at the station. The market rate is set based on the price the station is able to buy the gas for, plus a variable amount determined by the demand for fuel in a given area and other business expenses associated with running a fuel station. Fuel stations typically charge a higher rate for carriers who buy fuel with a credit or debit card to cover the fees that credit and debit card companies charge fuel stations. That’s why it is normal to see a difference between the cash price and credit/debit price for fuel, with the cash price being lower than credit or debit. Some fuel stations only display one price, so if you are going to use cash or a credit card to purchase fuel, it is important to know whether it is the cash or credit price before filling up. Even with 3% or 5% cash back, buying diesel with a credit card can limit your savings on fuel, and carrying a lot of cash around consistently is a hassle.
How to Save More
Luckily, there is an option that allows carriers to save money at the pump, without requiring them to carry large sums of cash with them at all times. Carriers of all sizes can sign up for a fuel card! How does a fuel card work? Fuel card providers negotiate deals with the truck stops and fuel stations to get discounts on the price of fuel that are normally only available to large fleets. They then pass these savings on to carriers. Each fuel card provider has their own network of fuel stations, as well as their own discounts and fee structures – so it’s important to do your homework and understand which fuel card gets you the lowest prices on the lanes you run most. Some fuel cards have monthly fees, transaction fees, and funding fees, but the discounts they offer are typically high enough to save you more money than paying with cash or a credit card. Some fuel cards, like the Convoy Fuel Card, do not have monthly fees or in-network transaction fees, so there is no risk in signing up and getting a card. Carriers can sign up for the Convoy Fuel Card directly in the Convoy app and can choose which stations to use it at in order to maximize their savings. In addition to superior savings, the Convoy Fuel Card also offers fraud protection, expense management, and tracking tools for owner operators and fleet managers, as well as IFTA tax data that helps carriers report during tax season.
The Right Fuel Card for your Business
Buying diesel to keep your truck or trucks moving is a massive business expense for any carrier, no matter their size. Signing up for a fuel card can be a great way to keep more of the money you earn each year by reducing the amount you spend at the pump. Through April 2021, carriers have saved an average 37¢ per gallon on fuel using the Convoy Fuel Card. With no recurring fees or in-network transaction fees, there is no reason to wait. The Convoy Fuel Card also features an in-app Fuel Finder – allowing carriers to search for in-network diesel stations along their route, right from their smartphone. Sign up today directly in the app and start saving!