How to Prepare for a New Year
2023 is in the rearview mirror as 2024 comes into focus on the horizon. The start of each year brings the promise of new beginnings as well as the question, “What should we prepare for this year?” That question is what we’d like to discuss with this post.
We are going to attempt to answer that question by posing three other questions we believe every fuel distributor should consider for this year.
1. How secure are you?
This question may first elicit concerns about cybersecurity or physical plant and/or office security. However, supply security is a vital area for any fuel distributor, and it is this security we are concerned about.
Supply Security – Changes you can make
Over the last decade, we have seen many propane distributors gain additional supply security by implementing tank monitors. This change allows the distributor to have a greater control over the customer tank capacity, level out their purchases, and provide for greater bobtail delivery efficiency. Some distributors have also invested in additional bulk storage, bobtail delivery trucks, or even an occasional transport carrier. While all of these are excellent at enhancing supply security, another process often gets overlooked.
Supply Security – Changes you can make
Over the last decade, we have seen many propane distributors gain additional supply security by implementing tank monitors. This change allows the distributor to have a greater control over the customer tank capacity, level out their purchases, and provide for greater bobtail delivery efficiency. Some distributors have also invested in additional bulk storage, bobtail delivery trucks, or even an occasional transport carrier. While all of these are excellent at enhancing supply security, another process often gets overlooked.
Supply Security – Changes your suppliers have made
Evaluate the changes your suppliers have made during the year as well. Some firms may have increased rail car capacity, while others have decreased. Some may have expanded their asset reach while others have sold assets. Still other suppliers may become much more active in actual production areas while others have vacated. All this information is vital to developing a secure supply plan for the upcoming year.
2. How prepared are you for the unexpected?
On the surface this seems like one of those questions where the answer is, “If I KNEW what to expect, then I would prepare for it.” But what we mean by “preparing for the unexpected” is trying to identify things that could change and have a dramatic impact on your distribution business.
The impact of climate change regulations
For the fuel distribution business, one of the largest “unexpected” items revolves around climate change regulations. Whether you operate in New York, Vermont, Massachusetts, California, Oregon, Washington, or any other state, you have the chance to be impacted by these regulations.
Engage with your customers and with local level government
Most states will not have regulations going into full effect in 2024. However, many states may discuss regulations or pass laws for a Cap-and-Trade or LCFS (Low Carbon Fuel Standard) that will have dramatic future impacts. Are you already engaged at a local level with both the government individuals shaping the new rules and your customers that will be impacted?
3. Do you have an organized plan?
We are not talking about your sock drawer, although that can still be important. Instead, we want to know if you have an organized plan for the coming year. Have you communicated with your team about the plan? Or are your decisions on security and the unexpected more haphazard and reactive?
Potential changes in 2024
Calendar year 2024 has the potential to usher in three new governmental leaders for the three major North American nations – Canada, the United States, and Mexico. Climate change regulations are pushing forward at a fast pace in many states. Fuel distributors, especially propane, are dealing with a domestic market that is heavily influenced by global factors. A lack of organization can allow these, and other items, to become daunting challenges for this year.
Twin Feathers can help!
Our Twin Feathers team is excited for 2024! We want to help provide our clients with strong supply security. We want to assist our clients in preparing for the unexpected changes resulting from climate regulations. We want to advise our clients on building an organized and systematic supply and risk management plan that can handle the challenges of 2024.
How do we plan to do this? By helping our clients make smart decisions every day. Contact us to see how we can assist your company during 2024.
How to Prepare for a New Year
By JD Buss
