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Variable Fuel Pricing at the Pumps in the UK
Recent press
reports (including a news item published in The Telegraph) indicate that major supermarkets look set to introduce variable
fuel pricing at the pumps in the UK – something that has apparently been
commonplace across Europe and the USA for some time.
Danish company a2i
is reportedly in talks to introduce the software – which allows petrol stations
to flex their pricing up to ten times each day – to supermarket forecourts
across the country. The new technology could be in place within just a few
months.
Currently, petrol
pricing seems to be ‘competitor led’, with prices changing in accordance with
other petrol stations in the area. However, the new system will change this to
a more ‘behaviour led’ model, analysing activity from large databases of
customer information to predict how those customers (and the petrol station’s
competitors) will behave.
This means that
prices could be changed several times each day. For example, prices could be
dropped outside of peak hours in supermarkets to encourage more footfall in the
shops, but at busy times such as school runs and Bank Holidays, prices could
rise to reflect the higher numbers of people at the pumps.
How is this likely
to affect same day couriers?
Critics are already
arguing that introducing real-time fuel pricing could further inflate the price
of fuel, with the ability to move prices up at peak times more likely than
lowering current prices at quieter times.
The AA’s Luke Bosdet
said: “This represents a huge change which would be most unfair on consumers
and families. It will wind them up no end as they become wise to the fact that
retailers can exploit price movements.”
For those who rely
on their vehicle for a living, though, the latest news could be an even bigger
kick in the teeth. With delivery costs already being squeezed, any potential
increase in the cost of fuel – even if it is just 2p a litre – could have a
significant impact on profit margins.
When out making
deliveries, you can’t always anticipate when your next tank of fuel might be
needed, so you are more likely to have a need for fuel during peak hours (and
with legitimate business reasons) than others who might be able to plan their
journey in advance.
While it might be
argued that getting people to change their behaviour and refuel at different
times could lead to better throughflow and quicker times at the filling station
in rush hours, it could also be argued that ‘peak times’ might also change as
consumers try to avoid higher prices – which might actually mean higher prices
during currently quieter times!
On the back of all
this, there could be a knock-on effect in the longer-term for consumers, who
may find themselves having to cover the increased costs of fuel used by the courier industry generally.
Of course, this may
all be much ado about nothing, with prices generally evening themselves out if
the new technology enters the mainstream, or arguably becoming cheaper for
those who fill up at quiet times. Perhaps any change may also be masked by a
lower price in oil that is likely following Donald Trump’s disputed decision to
pull out of the Paris Climate Change agreement.
How can costs be
kept down?
We can’t see into
the future, but we can control what is happening now. It seems more essential
than ever to choose the right vehicle to deliver your parcels and pallets, with the right mix
of carrying capacity, power and fuel efficiency to ensure timely deliveries are
possible – without the need to refuel too often.
There is also the
looming threat of a potential £20 a day ‘toxin tax’ for diesel vehicles
threatened for drivers entering city centres – another thing to consider when
choosing your next vehicle.
Like fuel, insurance
is a necessity, but again has seen pressure on prices following the
government’s decision to increase the rate of Insurance Premium Tax (IPT) from
the start of this month, and the ‘Ogden rate’ change also putting pressure on
insurers to meet rising costs of their own.
To counteract this,
Bollington Insurance works with leading providers of same day delivery courier insurance to help
ensure costs are kept at reasonable levels and allows you to spread the cost of
payments with several insurers, subject to acceptance. Bollington is always
looking to the future to make sure couriers are fully protected at a reasonable
price.
This is one area
where cutting corners can prove costly, but if budgeted for properly can save
you money in the long run.
Van Hero
Van leasing company, Vanarama, is launching a campaign to find
and reward the UK’s top Van Hero 2017. The award is in celebration of
independent van driving businesses across the country. It provides a
platform for people to nominate their favourite local van hero, no matter what
their trade or industry; be they a same day courier or florist, plumber or
builder. The company is encouraging people to nominate their local van
hero, or bullish businesses can even nominate themselves!
Andy Alderson, MD and founder of Vanarama says, “We want to
encourage people to vote for tradespeople in their local communities because
they are the backbone of this nation. Far too often van drivers receive negative
publicity for the wrong reasons but really, the majority of UK van drivers are
hardworking people, running their own businesses and following their dreams. We
have created these awards to celebrate entrepreneurialism in Britain and
will reward the overall winner with a complimentary three year van lease or
£5,000 prize.”
Vanarama is encouraging people to vote for their local van hero
across 11 UK regions (Scotland, Wales, Northern Ireland, North West, North
East, Yorkshire, East Midlands, West Midlands, South East, London, East
Anglia) before crowning the UK’s ultimate champion of the small business
community in a national final in October 2017.
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