Why Should I Get a Fuel Card?

Jul 1

You have probably asked yourself a couple of times whether you need a fuel card or not. Chances are, all those questions led you to search the internet for answers, hence you came across this article.

In the trucking industry, there are six basic questions that you need to ask yourself to help you decide whether a fuel card is a necessity for you or not:

Do you employ more than one driver?
Are you saving money with every gallon you purchase?
Are you up to your neck in receipts and reports?
Do you lack visibility of your vehicle's fuel efficiency?
Do your drivers drive further than needed to fill up their tanks?
Do you experience a consistent turnover by your drivers?

If you said “yes” to any of the questions above, then getting a fuel card is a wise move for your business. To help you understand why a fuel card can give your business an edge in the trucking industry, we have listed down 4 reasons below.

Track Fuel Expenses

Fuel Card Programs come with online account management systems and transaction reporting tools. This gives detailed information about purchases, including but not limited to the following: fuel cost, gallons purchased, odometer reading of the vehicle, date and time of the transaction, other costs associated, and name of the driver.

With a fuel card, you can set individual driver limits, as well as other cash or product limits to avoid overspending or unwanted expenses. Other fuel cards also offer text and email notifications which gives out updates every time purchases are made. Additionally, fuel cards also help you manage and monitor the fuel efficiency of your fleet, helping you make estimates and projections that will be helpful in budgeting your company expenses.

Convenience for Drivers

The majority of fuel cards in the industry are honored at gas stations across the country, thus, truck drivers can get the fuel they need, whenever and wherever the situation demands. Drivers will no longer have to worry about carrying enough cash that would cover the fuel needs for their trips, or even in cases when they unexpectedly need to refuel at any point of their journey.

This provides peace of mind that drivers will be able to get gas conveniently with a fuel card, especially when your fleet covers a large geographical area to ensure that for every mile a driver covers, access to a merchant that would accept your fuel card will be readily available.

Discounts and Extra Savings

One of the perks of getting a fuel card is the discounts, rebates, rewards, and savings it offers. Drivers who use fuel cards when they gas up are usually incentivized with exclusive discounts and fuel pricing.

Common discounts range from savings of 1 to 5 cents per gallon, tiered programs, loyalty programs with points earned per gallon purchased, and other savings.

Avoid Fraudulent Transactions

With several scams and malicious schemes everywhere, even purchasing fuel can come with risks of being a victim of fraud.

Fuel cards come with security features such as PIN codes, Card or ID numbers that must be entered before making a purchase. Also, fuel cards come with point-of-sale security and controls that give businesses the power to determine which charges are authorized or not in advance. Furthermore, with a more organized record-keeping system, you are assured of transparency for every transaction since detailed information is always taken into account.

Ultimately, fuel cards help you stay in control of your expenses. With fuel prices always fluctuating, it is important that you have the systems in place that enables you to monitor your fuel-related costs in order for you to make the necessary adjustments when the situation calls for it.

Learn more about fuel cards with Innovative and let’s talk about your goals in the trucking industry.

Rising Fuel Costs: What This Means to the Trucking Industry

With no exception, rising fuel prices continue to affect every single sector, the trucking industry included.

As we continue to hurdle through these prices in the spring and perhaps until the summer, let’s take a look at some reasons behind this continuous surge in fuel prices, its impacts on the trucking industry, and what we could do to conserve fuel.

Primary Reasons behind Rising Fuel Costs

1. Oil Production and Demand Remain Imbalanced - While the pandemic slowed down the demand for oil for almost a year, oil-producing and oil-exporting countries reduced their yield by as much as 10% of the global supply.

Despite the reopening of borders and resumption of travel with eased restrictions, oil production rates at present still cannot meet the pre-pandemic demand levels that are manifesting right now as supply is still lagging behind. Though efforts have been put in place to address this starting July 2021, experts say that it might have been too late and it will take some time before these could be felt.

2. Sanctions Imposed on Russia - While the global economy still has not fully recovered from the disruptions caused by the pandemic, here comes another global issue that has caused ripples affecting the global economy–the crisis in Russia and Ukraine. The White House has imposed a ban on Russian gas and oil imports, which is Russia’s primary source of income. This has made it difficult for Russian oil to penetrate the global market, which consequently affects the prices of oil from other exporting countries and even other commodities.

Though the United States does not fully rely on Russia for oil imports, the ban still increases the price of oil from other exporting countries, hence the price increase when it reaches American consumers.

How It Affects the Trucking Industry

At a record high of about $5 per gallon, fuel prices have made a huge dent in trucking companies. Basically, if prices continue to stay this way, experts say that people could go out of business. The number of active trucks in a fleet could be lessened, or in some cases, an entire fleet could remain parked to cut down on expenses, which could result in huge repercussions for the trucking business.

These include cutting into trucking margins and even penetrating into empty-cargo “deadhead” miles, post-delivery, and other relevant costs which will even increase prices. If more businesses face financial challenges and even closures, this could mean massive stalling, delays, and further downtimes in the trucking industry.

The trucking industry will not be carrying this burden alone, but other sectors will feel the weight of these fuel price surges as well.

According to the American Trucking Association, more than 70% of freight is moved by trucks and because of the surging fuel prices, everything else could experience a price increase, from food and clothing down to supplies and materials. Fuel prices are directly proportional to the cost of living; so, if fuel prices increase, the cost of living will also increase.

Tips to Save Fuel

As prices will remain high for weeks or even months to come and since the situation is still unpredictable, the burden is now on the consumers to practice fuel saving. Here are some of our tips for you to save fuel:

1. Fine Tune Your Truck - Ensure that you have correct tire pressure, get rid of unnecessary weight, activate cruise control on the highway, use the air conditioning wisely, and regularly conduct preventive maintenance. These will help your truck run at optimum capacity and avoid eating up extra fuel.

2. Maximize Technology - Use apps to optimize your route, thereby avoiding traffic and stalling, elevating or uphill roads, and even helping you choose straight paths with fewer turns. There are also apps that help you find cheaper fuel along the way.

3. Make Use of a Fleet Fuel Card - A fleet fuel card comes with a fuel management program that analyzes fuel expenses, builds a fuel purchase report for fleet managers to look into, limits the grade of fuel purchased as well as non-fuel-related purchases, and lets the company set certain limits to avoid unnecessary expenses.

Aside from this, fuel cards also help track multiple refuelings or anomalous fuel transactions. You can get a fuel card from trusted and reliable sources like the Innovative Logistics Group.

As we continue to tread through these challenging times in the face of fuel price surges, we are committed to helping you sustain and achieve your trucking goals.

For all your needs in the trucking industry, talk to us today.