Client
A Midwestern convenience chain with over 2,100 stores across 16 states

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Client Challenges

Pricing Strategy and Fuel Price Optimization 

The c-store chain was in aggressive growth mode. Its strategy included disciplined store additions, strategic acquisitions, and increasing same store sales and fuel gallons. As part of its Value Creation Plan, the company had identified price optimization as one of its key initiatives to enhance store performance and unlock shareholder value.

A main area of focus was price optimization initiatives for fuel. Its leadership sought guidance from us to develop a pricing strategy, source effective technology solutions, and create the organizational structure to meet their current and long-term goals.

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Solutions Delivered

Created change management plan and helped client move from decentralized to centralized fuel pricing strategy

Our team worked over the course of a couple months to gather ample data to inform the strategy. First, we conducted internal and external assessments to get a full view of the client’s current state and existing process for fuel pricing. This required thorough research on the company, as well as fuel price optimization industry best practices. Through this research, we found actionable information on emerging trends, as well as best in class technology and platforms.

Next, our team performed several different analyses that identified opportunities to improve operational efficiencies and profit margins. We also did extensive research and evaluation of leading fuel price optimization solution providers that would be most beneficial to the client’s goals and needs.

Finally, we helped the client setup and deploy a centralized fuel pricing organization. Our team led the client through the process to setup and run a new centralized pricing model. The team grew from one person to nine members over a short period of time. Now, all fuel decisions are made by this central group, yet prices are tailored for every local market. In addition, we designed a change management plan to help gather input and increase the success of the new fuel pricing strategy.

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Business Impact

Client gained significant agility to capture additional fuel margin while maintaining a competitive pricing structure

Through proprietary insights and resources, along with data gathered during the research and analysis phases, our team guided the client in setting up a centralized fuel pricing strategy, as well as the selection of a technology solution provider that met their needs and would deliver optimal results.

The convenience store chain has profitably implemented a centralized pricing strategy that utilizes data-driven pricing rules and price optimization capabilities. In the 6-month period following implementation of the new strategy, fuel margins increased almost three cents per gallon, gallons increased 3.1% and fuel gross profit dollars increased 20.5%.