[White Paper] Credit and Product Controls - Today’s most cost-effective and efficient way to grow your business
 

[White Paper] Credit and Product Controls - Today’s most cost-effective and efficient way to grow your business

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Many successful fuel suppliers and marketers are utilizing credit and product allocation management systems that help them manage risk and control the credit line of their customers at the terminal. ...

Many successful fuel suppliers and marketers are utilizing credit and product allocation management systems that help them manage risk and control the credit line of their customers at the terminal. After all, suppliers are in the business of selling fuel, not giving it away. Naturally, it’s beneficial to sell to the best, most reliable customers. Making sure you do just that is sometimes the hardest part of the sale.

These allocation management technologies are used to reserve or allocate product across both proprietary and third-party terminals in an enterprise and protect volume for customers with branded or contractual agreements at the terminal. In some cases, the supplier might also use this technology to reserve product for its own business use.
While at first this approach might sound like it is intended to limit the oil company’s business, it actually proves to achieve just the opposite. A centralized credit and product allocation controls solution creates a safety net that empowers sellers to enter new markets with potentially tighter margins and do business successfully with customers who had posed a greater risk in the past.

In this paper, we discuss the features of credit and product control systems that can help a savvy supplier differentiate its brand in a commoditized marketplace – and grow its fuel supply business.

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    [White Paper] Credit and Product Controls - Today’s most cost-effective and efficient way to grow your business [White Paper] Credit and Product Controls - Today’s most cost-effective and efficient way to grow your business Document Transcript

    • Credit and Product Controls Today’s most cost-effective and efficient way to grow your business 2011 / White paper by Lisa Rotunno Make the most of your energy SM
    • Summary Executive summary ..................................................................................... p 1 Introduction ................................................................................................. p 2 Customer service, customer service, customer service ................................ p 4 The power of electronic BOLs . .................................................................... p 6 The new way of doing business ................................................................... p 6 Centrally managed product moves help protect supply efficiently . ............... p 7 Grow your business with the industry-leading DTN TABS solution ................ p 8 Conclusion .................................................................................................. p 9
    • Grow Your Business Through Credit and Product Controls Executive summary Fuel suppliers and marketers are putting advanced technology, centralized credit and product control systems to work to benefit both sides of the suppliercustomer relationship. These information systems make it possible for the supplier to make current allocation and lifting status readily available to its customer, so both can best manage their processes, avoid supply issues and lengthy telephone resolution, and dispatch and lift more efficiently. With exceptional service and attention, the customer does not need to, nor is inclined to, pull from another supplier or go to another terminal. The electronic Bill of Lading (eBOL) generated automatically by such a system and transmitted immediately to a customer who is re-selling the product lets that customer invoice faster. Allocation viewing provides customers with secure, upto-the-minute credit availability, product forecasts and current month allocations. Again, the customer recognizes streamlined business as enhanced service. In addition to improved customer relations and loyalty, the supplier applying a robust credit and product controls solution helps its own cause. It can accurately factor all elements affecting a customer’s limits. It can relay in real time vital communications regarding product availability at any specific terminal and customer credit across all terminals, all to optimize enterprise efficiency. Advanced allocations capability helps automate and streamline the adjustments necessary to manage supply disruptions efficiently. DTN TABS from Schneider Electric was developed by industry specialists to provide these capabilities and benefits. Further, it reflects industry standards that enable seamless interoperability with enterprise resource planning (ERP) systems, making information available to all business processes. Designed with functional modules, this solution is easy to update and keep pace with industry requirements and customer needs – and, therefore, retains its initial investment value. Making permanent savings through accurate, automated billing White paper on improving credit and product controls | 01
    • Grow Your Business Through Credit and Product Controls Introduction Many successful fuel suppliers and marketers are utilizing credit and product allocation management systems that help them manage risk and control the credit line of their customers at the terminal. After all, suppliers are in the business of selling fuel, not giving it away. Naturally, it’s beneficial to sell to the best, most reliable customers. Making sure you do just that is sometimes the hardest part of the sale. These allocation management technologies are used to reserve or allocate product across both proprietary and third-party terminals in an enterprise and protect volume for customers with branded or contractual agreements at the terminal. In some cases, the supplier might also use this technology to reserve product for its own business use. While at first this approach might sound like it is intended to limit the oil company’s business, it actually proves to achieve just the opposite. A centralized credit and product allocation controls solution creates a safety net that empowers sellers to enter new markets with potentially tighter margins and do business successfully with customers who had posed a greater risk in the past. In this paper, we discuss the features of credit and product control systems that can help a savvy supplier differentiate its brand in a commoditized marketplace – and grow its fuel supply business. White paper on improving credit and product controls | 02
    • Making permanent savings through accurate, automated billing
    • Grow Your Business Through Credit and Product Controls Customer service, customer service, customer service It’s The Golden Rule: Treat the customer as you would like to be treated. Providing exceptional customer service – by assuring customers have product when they need it, in a way that minimizes their costs – will gain and maintain preferred status for the supplier. Suppliers using credit and product control systems make sure their customers are informed, happy – and retained as customers. Keeping the customer informed. The smartest suppliers are improving customer relations and enhancing their trusted supplier status by providing ondemand Web access to product and credit availability information. Customers who don’t know their allocation status or contract ratability are more likely to dispatch trucks with inadequate credit or product allocation. Only when they arrive at the rack do they discover they are unable to load and then incur costly demurrage charges or higher delivery costs due to lack of timely information. The supplier with an advanced controls system can eliminate this scenario. It can make simple lifting information available, such as which products are available and at what terminals. Or, it can provide even more detailed information, showing specifics on how many gallons are available of each product; when allocation will refresh; the refresh amount, and more. It’s even possible to feature contract ratability so customers know when they need to lift, to remain ratable against their contract commitment. This approach gives the customer a greater sense of control and minimizes a need on the supplier’s part to enforce a “take or pay” contract clause. Providing real-time ratability status ends the guesswork on the customer’s part and provides the supplier with a tool to manage contracts easily. White paper on improving credit and product controls | 04
    • Grow Your Business Through Credit and Product Controls Customer service, customer service, customer service (continued) Proactive communications help customers: • Better manage contract compliance • Identity supply issues faster • Dispatch more effectively • Reduce truck downtime. Keeping the customer happy. When customers are out of allocation, the phones are ringing off the wall. Account reps and management are spending more time soothing unhappy customers than selling. Worse, they are calling customers after the fact to reprimand them for either over- or under-pulling – not the best way to build a relationship or future sales. Using a reliable allocation management system helps the supplier create a group of premier customers – assuring them they always have product available at the terminals in which they regularly lift, regardless of tight supply. The most robust systems also allow those best customers to extend allocation controls to their best customers. Keeping the customer a customer. There are only two options when the customer arrives at a terminal to discover allocation problems: pull from another supplier or go to another terminal. This is lose-lose for all parties involved: the supplier, the customer and the terminal. The result: lower margins, costly reconciliation and greater difficulty in benchmarking the performance of carriers and other business partners. Online allocation visibility lets the customer know allocation status before there is a problem. Alerting customers to their allocation and credit levels often encourages them to lift more. And when these communications are branded to reflect a supplier’s unique company image, a powerful new customer touch is generated that supports future business. White paper on improving credit and product controls | 05
    • Grow Your Business Through Credit and Product Controls The power of electronic BOLs With automated product controls, the Bill of Lading (BOL) is electronically generated as soon as gallons are lifted at the rack, and it is transmitted immediately to both the supplier and the customer. From there, electronic copies of the BOL with the driver’s signature can be placed on the supplier’s Web portal for customers to view securely at any time. The power of an electronic BOL doesn’t stop there. The supplier who uses an automated controls system usually can take advantage of electronic integration with a customer’s accounting package. This service enables the marketer customer who is re-selling the product to invoice faster. Alternatively, with a hard copy BOL, the marketer customer often doesn’t have load information for days; when the paper BOL finally does show up, the marketer’s account has already been debited before there is enough information to invoice the secondgeneration customer. It is a paperwork headache and an expensive cost-of-money proposition for the marketer customer. Once again, the supplier is providing muchappreciated customer service with eBOLs. The new way of doing business Managing credit. The robust credit and product controls solution gives the supplier an accurate credit limit for each customer that should factor in load prices, taxes, non-invoiced BOLs and receivables balances. In volatile markets with increased prices, this is an invaluable functionality for the supplier who needs to closely monitor and control customer liftings against up-to-date credit limits. Real-time communications. The supplier can provide customers direct feedback about remaining product available at their preferred terminal and their remaining credit available across all terminals. Information can be provided through an e-mailed alert and to a mobile device. Real-time communication imparts details of loading problems quickly and clearly, to help resolve issues and authorize load Extend the customer service A robust controls system module such as the DTN TABS Rack Marketer extends its best features of allocation management and real-time billof-lading (BOL) delivery, one level further. The supplier can empower its customers to leverage DTN TABS in their own businesses, offering them the same advantages: reduced risk and strengthened customer business; inherently, fortifying the original supplier-customer relationship. It’s all about customer service! releases in real time – and improve business efficiency for the customer and the supplier’s enterprise. With the ability to solve daily challenges efficiently and effectively, the supplier is doing business in a new way: converting those challenges into opportunities to go “above and beyond” for its customers. White paper on improving credit and product controls | 06
    • Grow Your Business Through Credit and Product Controls Centrally-managed product moves help protect supply efficiently It could be that the most stressful part of being a supplier is dealing with business disruptions. It is challenging to grow your brand and your bottom line during times of supply interruption, such as hurricane season or pipeline disturbances. An advanced allocations solution allows the supplier to move volumes of selected allocations from the primary terminal to a backup terminal, while keeping the allocations intact at the source terminal. Once the supply constraint is resolved, the moved allocations would be set back to normal lifting conditions, taking into account the extra volume lifted at the backup terminal during the disruption. The ideal solution also would let the supplier move products in a scaled manner, for a scheduled period of time – automating what would otherwise be an extremely labor intensive manual process. Here are some examples: •  hort Outage of zero to three days that occurs within an allocation week S (such as Sunday through Saturday): the supplier only wants to move a few days of supply to the backup terminal •  hort Outage of zero to three days that overlaps an allocation week refresh S (such as Tuesday – Wednesday – Thursday): the supplier needs to add a few days of supply to the backup terminal after the period refreshes •  ong Outage that lasts more than an allocation week: the supplier might L need to move the full allocation volume for the period to the backup terminal Further, the supplier needs to inform its customers which terminals and products are affected during these times, to assure them they have access to product and where the product is available. A centralized solution enables lightning-fast adjustments, forward and backward, of all allocations for every customer at all terminals, or a specific terminal or terminal group, with just a few clicks of a mouse. This approach eliminates calling terminals to shut off product. The supplier can allocate all customers equally or save the remaining product for premier or contract customers. Best of all, the supplier can apprise its customers of the situation in real time – good customer service. White paper on improving credit and product controls | 07
    • Grow Your Business Through Credit and Product Controls Grow your business with the industry-leading DTN TABS solution Designed and developed by a consortium of industry leaders, DTN TABS from Schneider Electric reliably delivers robust and flexible credit and product control. It is the leading third-party terminal allocation and credit control service – interfacing with all major terminal automation systems and many proprietary systems and supporting more suppliers and rack marketers than any other service. Enterprise performance. DTN TABS has shown to be easy to implement and provide business efficiency and risk management that is unparalleled by any other technology provider. Schneider Electric is an active participant in PIDX and fully supports industry standards to ensure interoperability that will optimize the downstream supply chain. Suppliers interface it with SAP and other ERP systems to share real-time lifting information with other business processes accurately and efficiently – which ultimately minimizes cost of ownership. Keeping current. While it has been in production for more than 25 years, DTN TABS is continuously enhanced and extended by Schneider Electric to keep pace with industry requirements and customer needs. This ongoing investment ensures that DTN TABS will evolve to meet suppliers’ future business needs while they minimize capital expenditures on proprietary internal systems. Recent DTN TABS enhancements include: •  nhanced Credit Module – enables suppliers to consider receivables balances, E fuel prices, taxes and non-invoiced BOLs, to more tightly align customer credit controls •  ove Product Allocations Module – gives suppliers the ability to quickly respond M to supply situations by quickly and efficiently move allocations from a primary terminal to a backup supply terminal White paper on improving credit and product controls | 08
    • Grow Your Business Through Credit and Product Controls Conclusion In today’s fast-moving downstream environment, supplier organizations must be responsive and accurate to gain complete rack control over credit and product across all proprietary and third-party terminals – and stay competitive. The implementation of a robust, single platform that provides real-time lifting information and dynamic, granular credit control reduces supplier risk and strengthens customer service. See for yourself how credit and product controls can enhance customer service and grow your business, with a live demonstration of the industry-leading DTN TABS solution. Schedule a live demonstration of DTN TABS by calling us at 1-866-460-1030. Meeting suppliers’ future business needs while reducing capital expenditures on proprietary internal systems White paper on improving credit and product controls | 09
    • ©2012 Schneider Electric. All rights reserved. Schneider Electric USA 9110 West Dodge Road Omaha, NE 68114 Phone: 1-800-391-1175 Fax: 1-402-255-8125 http://www.schneider-electric.com August 2012