Fuel Oil News

Fuel Oil News July 2012

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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V I S I O N S 2 0 1 2 requirement should not be at all difficult, Lindemer said. "There's plenty of biodiesel around," he said. "That industry's running at very low utilization rates. I don't see supply being an issue." New York State has not passed legisla- tion to match New York City's requirement that ULS fuel oil contain two percent bio- fuel, but that is a goal of the Empire State Petroleum Association (ESPA). As of this writing, bills that would require two percent biofuel content in fuel oil were pending in both houses of the New York State legislature, Thomas J. Peters, ESPA's chief executive officer, said. Despite the failure of Congress to reau- thorize The National Oilheat Research Alliance (NORA), the group manages to remain active through partnerships with other organizations, such as the National Biodiesel Board and the New York State Energy Research & Development Authority, said John Huber, president of the Alliance. Current or recent projects include the post- ing of training videos on YouTube and research into the effects of higher biodiesel blends on seals, Huber said. For fuel oil dealers, decreasing volume was a fact of business during last season's non-winter: two consultants, John Levey of Oilheat Associates and John Nardozzi of Nardozzi Consulting, advised attendees to focus on margin. "So many people don't know what their margin should be," Nardozzi said. Besides payroll, rent, insurance, employee benefits, advertising, loan payments and cost of new equipment, remember to include profit, he said. Dealers should monitor gallons and margin every day, continuously working to maintain or add to margin, he said. "Gallons fell off the table this year," Nardozzi said, generally dropping by more than a third. Compounding the challenges were a price spike, and to some degree for many dealers, loss of customers to dis- counters or to other fuels, Nardozzi said. For those whose businesses are threat- ened, Nardozzi enumerated survival tactics: stop all discretionary spending; postpone capital expenditures; use up inventory; let seasonal employees go; lay www.fueloilnews.com | FUEL OIL NEWS | JULY 2012 13 off as many employees as possible; stop all overtime; shorten the work week; take excess vehicles off the road. The last point was a pet peeve for both Nardozzi and his co-presenter Levey. "Look at your company as if you're going to buy it," Levey advised. "The first thing I hope you notice is that you have too many trucks." Most dealers, Levey said, "are grossly over-trucked." Besides the accumulated cost of regis- tration and insurance, Levey pointed out, the vehicles are losing value over time. l FON

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