The Benefits of Retail vs. Bulk Fueling

Considerations for fleet fueling strategies

Some fleet managers assume that bulk fuel is the most cost-effective means of supplying their fleets – that the more fuel you consume, the greater the probability that bulk fuel is right for your fleet.

For some operations, such as emergency or first-responder vehicles, bulk tanks may be an operational necessity. Yet this convenience comes at a cost: Installing, operating and maintaining bulk tanks is generally far more expensive than paying for fuel at the pump. For most fleets, independent of size, retail fueling with a universal fleet card is more economical compared to the investment needed for bulk fuel.

Fleet managers considering embarking on or renewing their bulk fuel plans should carefully investigate the total costs involved – not just the upfront outlay for installation or upgrades, but also ongoing expenses  in terms of resources and regulatory compliance. In almost every case, the numbers will tell the same story: Fleet cards are the more cost-effective option.

When investigating and comparing the costs of bulk fueling versus fleet cards, the following points should be taken into consideration:

• How bulk fueling includes high capital outlays and regular operating expenses
• How bulk fuel purchasing adds extra time and resource commitments
• Why bulk tanks have a higher risk of theft and misuse

Tanks or cards: Which is right for my fleet?

In some scenarios, bulk fuel tanks do make sense. Bulk fueling is most useful for companies whose operations depend critically upon uninterrupted fuel access, such as emergency repair trucks for government or utility fleets. Bulk tanks may also make sense for fleets that need flexible on-site fueling options, such as in managing heavy machinery at remote work sites.

Even in cases where tanks provide necessary 24/7 fuel access, their cost is usually higher than retail fuel. Retail fueling is typically cost effective for the broadest range of fleets, whether confined to a geography, or spread out over multiple locations. Sites that are open 24/7 can also be more difficult to operate, and require logistical coordination and manpower.

It’s also important to note, fuel theft is a persistent problem. Industry estimates suggest that 81% of fuel theft is internal, and that 2-3% of companies’ fuel budgets are on average lost to theft, though for some small fleets these figures may be much higher. Depending on the fleet’s size, theft can result in tens, or even hundreds, of thousands of dollars lost each year. That’s why it’s crucial to have a means of stopping fuel theft and abuse before it happens

For fleets who encounter theft and fraud, cards offer checks and balances to control inappropriate spend, and monitor employee behavior. Fleet cards also help managers constrain operating costs, while avoiding the hassle and expense of dealing with regulatory red-tape and the obtuse bulk purchasing market.

The majority of small-, mid-, and even large-sized fleets will find using fleet cards to fuel vehicles at retail stations a far more cost-effective option than bulk tanks.