The home heating oil industry has a long and proud history, and Fuel Oil News has been there supporting it since 1935. It is an industry that has faced many challenges during that time. In its 77th year, Fuel Oil News is doing more than just holding
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www.fueloilnews.com | FUEL OIL NEWS | DECEMBER 2015 23 BUSINESS OPERATIONS is similarly not surprising that roughly 79% of that volume goes to residential customers. BIOFUEL AND ULTRA LOW SULFUR There has been a strong movement in the industry towards biofuel-based heating oil and ultra-low sulfur diesel. This has been driven for a range of rea- sons—these green fuels tend to appeal to residents in the primary heating markets; they can significantly simplify heating appliance maintenance; and they repre- sent an opportunity to be an acceptable fuel in any low carbon fuel standard that might be set in key heating oil mar- kets. Nearly half of respondents (46%) sold a biofuel blend. Of those selling a blend, 91% of the respondents sold B5 (5% mixture), and 21% sold B20 (20% mixture). In the "other" category, some respondents sold blends between 2% and 99%. In addition to biofuel, 75% sold a heating fuel with ultra-low sulfur con- tent which has seen significant growth as many states in the Northeast see ULS mandates come into effect. PETROLEUM FUTURES, PRICE PROTECTION AND ONLINE ORDERING Some 51% with this year's respon- dents participate in the futures market. Somewhat more at 60% offer price pro- tection programs. Of those that offer price protection 25% of their customers take advantage of the opportunity. Some 44% of respondents charge a fee for the pro- gram and 23% a buyout option. Half of respondents (50%) offer their customers online ordering. FUEL MARGIN The average fuel margin was fairly consis- tent among respondents; however, several fuel oil marketers had goals almost twice as high as the average. The number in paren- theses reflects removing these companies from the totals. That was not the case with the propane respondents which were far more consistent. BULK PLANT OPERATIONS Some 59% of respondents operated a bulk plant with an average storage capac- ity of 421,950 gallons. It should be noted that a number of larger respondents had millions of gallons of storage. With those removed a more typical "dealer/marker" figure would be 196,962 gallons. Some 80% of respondents stored other petro- leum products in their bulk plants and 69% had substantially upgraded their bulk plants in the past 10 years. FUEL ADDITIVES Roughly 85% of the respondents used fuel oil additives. The additives were blended in a variety of manners that often over- lapped. THE SERVICE DEPARTMENT Roughly 74% of respondents operated a service department. The figures for service vans track well with the number of service technicians noted earlier in the survey. Some 51% of respondents indicated they were consid- ering the purchase of new service vehicles in the coming year. DELIVERY TRUCKS For delivery trucks, the optimal desired TABLE 6 PERCENTAGE BREAKDOWN OF ANNUAL FUEL-OIL SALES, BY VOLUME RESIDENTIAL 79% COMMERCIAL 16% INDUSTRIAL 5% TABLE 7 WHAT IS YOUR GOAL MARGIN ON FUEL OIL? RETAIL $0.70 COMMERCIAL $0.42 PROPANE $1.10 TABLE 8 WHERE BLENDED BULK PLANT TANKS 74% ON TRUCKS 37% DIRECTLY INTO CUSTOMER TANKS 33% TABLE 9 SERVICE DEPARTMENT SERVICE CALLS 1,891 SERVICE INVENTORY $96,500 SERVICE VANS 8 NEW PRODUCT RELEASE PLC Based Duplex Automatic Pump Sets Exciting News! The Webster duplex automatic pump set has a new design that includes a PLC Based Oil Management Control Panel. How would you like to have the ability to re- mote access and control a particular job with- out leaving your office or service vehicle? The advanced features of the touch panel display will allow you to receive emails in real time with embedded PLC data. The panel can send data remotely via the internet to a remote PC or Smart Phone APP. Retrieve logged fault data and alerts remotely. Many new options are now available. For more information, scan the QR code above or visit our website. Webster is a leading manufacturer of fuel oil pumps and valves for the oil heat industry. We manufacture a wide variety of Fuel Oil, Waste Oil and Bio Pumps, Regulating Valves, Oil Safety Valves, Duplex Pump Sets, and Supply Pumps for Residential, Industrial and Commercial burner applications. Contact Info Tele# 800.766.1233 Fax# 502.223.4629 Visit: www.websterfuelpumps.com webster@cctoolinc.com www.websterfuelpumps.com