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NORFOLK, Va. -- Miller Oil announced that it has begun implementation of PriceNet fuel price optimization software. The system, developed by Florham Park, N.J.-based KSS Group plc helps retailers determine the optimal fuel pricing strategy for each grade at each location within a network.
In an interview with Convenience Store News, Mark Hawtin, senior vice president of sales and marketing for KSS explains the logic behind the company's software. "Markets vary widely in terms of price sensitivity," he said. "There are some markets where, unless you follow a competitor every time they change their price, you could lose your shirt."
However, Hawtin pointed out that even at locations where the price of regular unleaded is under intense pressure, retailers can often trade margin with other grades of fuel. Also, retailers can develop a chain-wide approach to margins by testing how price sensitive gasoline is at other locations within their networks.
"The challenge of an operator managing a network is knowing which sites need careful [fuel price] management because they are very price sensitive and trading margin off those against other sites where you can make more margin without losing volume," said Hawtin.
"We are excited by the opportunity PriceNet offers us to gain better insight into our pricing operations while extracting maximum margins from our retail fuels business," Jeff Miller, CEO of Miller Oil said in a release. "We see the KSS offering as a stepping stone to becoming industry leaders in efficiency and profitability, allowing us to continuously improve the service to our customers and to effectively respond to the ever-changing market conditions we face."