Airline fuel suppliers & resellers – The 5 biggest headaches

During the research phase for our new fuel management software for airline fuel suppliers, supplier.ONE, we talked to numerous fuel suppliers and resellers about the biggest day-to-day challenges they faced in relation to data, administration and business efficiency.

Here’s what they told us; how do they compare with your own challenges?

1. MAINTAINING A SINGLE UP-TO-DATE LIST OF JET FUEL PRICES

This was by far the main issue for the jet fuel suppliers and resellers we spoke to. The sheer complexity around how jet fuel prices are determined, the number of different components that make up the price, and the volatility of the energy market, make this a real administrative pain for most companies.

Our experience is that aviation fuel suppliers and resellers are either:

  1. trying to manage and manually update multiple Excel spreadsheets
  2. trying to use a generic Enterprise Resource Planning (ERP) system from, for example, Microsoft or SAP.

Neither solution works very well. Manually managing multiple Excel spreadsheets is resource-intensive, limits your ability to interrogate the data, and leaves you vulnerable to human error; while generic ERP systems weren’t designed with the aviation fuel supply market in mind, so they usually aren’t a good fit with business processes.

Of course, being able to maintain a single up-to-date list of jet fuel prices is crucial to the business, because all quotes and invoices are based on this.

2. MONITORING THE CREDIT LIMITS OF AIRLINES

The main challenge here is about keeping credit limits sufficiently up-to-date, bearing in mind the number of refuelling events that could be taking place each day, and the number of fuel tickets this would generate.

Again, the norm seems to be that jet fuel suppliers and resellers manually maintain this information in Excel files, so the risk of human error and out-of-date information is high. This is leaving aviation fuel suppliers and resellers financially vulnerable.

3. CREATING A TRANSPARENT PRICING POLICY

This issue is of course, closely linked with point 1. Many of the jet fuel suppliers and resellers we talked to are struggling to create a pricing policy that can be understood and applied by different members of staff.

Due to the complexity of pricing – which could include perhaps different mark-ups based on location or fuel volume, as well as the frequency with which price components change – pricing decisions are mainly being taken by the fuel desk manager. This can slow down the process of quoting and responding to fuel requests and isn’t the best use of resources.

4. OPERATING A SLICK AND EFFICIENT FUEL REQUEST PROCESS

In order to supply fuel to an airline at an airport, numerous steps must be taken, appropriate checks made and data from various sources needs to be tied together. For example, when an aviation fuel supplier/reseller receives a fuel request from a customer, they need to check credit, send out authorisation to the airport, issue fuel codes, a corresponding fuel order, and so on.

Most jet fuel suppliers and resellers we talked to, are manually checking several Excel spreadsheets and copying and pasting information between documents. Again, this seems to be a waste of skilled resources and leaves suppliers at risk of human error.

5. CAPTURING FUEL TICKET INFORMATION QUICKLY

We discovered that for aviation fuel resellers in particular, it can take a long time for them to receive confirmation of the actual amount of fuel uplifted.

While fuel tickets are issued to the pilot, airline and fuel supplier, they aren’t given to the resellers. This means that fuel resellers usually have to wait for the suppliers to send an invoice before they know the actual volume sold, and this can create cashflow problems. This also means that fuel resellers have to trust fuel suppliers to invoice for the correct amount.

Jet fuel suppliers are in a better position here, but even for them, the process of gathering and checking hundreds of paper-based fuel tickets and then raising invoices for these, is a laborious and slow process.

IN SUMMARY

So there we have it: our understanding of the biggest day-to-day headaches for aviation fuel suppliers and resellers.

The good news is that we’ve used this knowledge to build the first fuel management software designed especially for aviation fuel suppliers and resellers, supplier.ONE. So there’s finally a solution designed for your industry, which can help modernise your processes and improve your business efficiency.

In our next blog post we’ll be covering the main benefits of supplier.ONE and how they can overcome these 5 key problems, so do look out for that.

Do these issues sound familiar to you? What others might you add? Let us know on Twitter @FuelPlusGroup using #fuelsupplierpain.