A New Approach to Dealing with a Costly Commodity

Date: NOV 8th, 2007

Topic: Franchise News

Langley, Canada, November 07, 2007 --(PR.com)-- “If it’s empty, fill it.”

It’s the attitude most businesses have when it comes to fueling their heavy equipment or vehicles, whether it’s an earthmover or a fleet of delivery trucks. Many rely on “jobbers,” typically mom-and-pop operators who fuel vehicles onsite on a cost-per-gallon basis. Other companies might have their own refueling trucks or storage tanks, while others simply use commercial pumps.

The cost of their fuel is the price they pay at the pump. It’s simple. At least that’s what they think. But they’ve got it all wrong.

Fuel represents the second-highest expense behind labor for businesses involved in transportation, logistics, construction and other fuel-dependent industries. And while every business dedicates resources to managing their labor costs, few have processes in place to manage their fuel. They rarely consider such factors as labor, insurance, theft, loss of productivity and inefficiency that comprise their “true cost” of fuel.

4Refuel specializes in 24/7 onsite diesel refueling, fuel logistics and automated fleet management, providing clients with such information as when fuel is delivered, which equipment or trucks it is delivered to, and most importantly, fuel usage. Clients can access the data online through user-friendly reports with the click of a mouse.

Headquartered in Langley, British Columbia, just outside Vancouver, 4Refuel launched its first “corporate franchise” in the United States in Seattle on Aug. 1. Focusing its initial U.S. expansion on western states, 4Refuel expects to have 50 to 75 franchised and corporate-operated tanker trucks in the U.S. by the end of 2010, delivering more than 24 million gallons of fuel. 4Refuel currently has approximately 100 tanker trucks operating in Canada.

“Fuel has always been seen as a commodity,” said Norm Bogner, 4Refuel’s vice president of international development. “We are not selling fuel. We are selling service and business intelligence so companies can better manage their business. We’re merging the delivery of a commodity with technology. There is no other franchise opportunity like 4Refuel.”

4Refuel already serves more than 6,000 clients in Canada in all industries, including FedEx, Coca-Cola, CN Rail, Brinks and Tim Hortons. It safely delivered more than 52 million gallons of diesel and biodiesel fuel to customers in 2006 via more than 1.3 million individual refuelings. It reached an impressive benchmark in July 2007 when it pumped its one-billionth liter of fuel.

The United States represents an estimated annual commercial fuel market of 56 billion gallons, but the U.S. onsite refueling industry is still in its infancy and highly fragmented, consisting primarily of the small, local “jobbers” and larger, multi-region operators. Most have no sophistication in areas of providing superior service, logistical information or fuel management.

“There is going to be more competition in the United States, but who are we competing with?” asks 4Refuel founder and CEO Jack Lee. “We do onsite refueling but when we add our technology and fuel management principles, we differentiate ourselves from our competition. We are supplying the tools to help minimize the fuel our clients burn and maximize the productivity they get from their engines.” In 2007, 4Refuel expects to safely deliver more than 257 million liters (67 million gallons) of fuel, a 26 percent increase over the 203 million liters delivered in 2006 so it’s no wonder that Lee predicts 4Refuel will be delivering 10 billion liters of fuel (2.6 billion gallons) internationally by 2020. Initial expansion into Europe is planned for 2008.

4Refuel’s expansion into the United States will be through a network of regional franchisees who are granted exclusive territories in which they will be required to operate a minimum of 10 tanker trucks by their fourth year in business, beginning with a minimum of four the first year and adding a minimum of two trucks in each of the next three years.

Each 4Refuel franchise location will include dedicated territory managers who will build and maintain a client base for the franchisee, making sure customers’ needs are always met. Monthly client care calls ensure that any additional service requirements or adjustments are implemented on an ongoing basis.

“We want to be the branded name in fuel management on a global basis," Bogner said. “When I explain our concept to individuals who have been in franchising for 25 or 30 years, their eyebrows raise in amazement. This is not another smoothie or fast-food concept. 4Refuel is unique and offers prospective franchisees a ground-floor opportunity to be part of the solution to the ever-increasing costs of the fuel industry.”