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A guide to implementing a fuel management plan

Effective fuel management can help businesses to lower consumption, improve fuel economy and reduce costs. That’s why we’ve put together this complete guide to help you plan, budget and prepare your equipment to help you get the most out of your assets.

If you have any questions surrounding fuel management, call 0330 123 1144 today to speak to our experts.

What is a fuel management plan?

A fuel management plan is a strategy employed by a business to forecast fuel consumption, manage procurement costs and build supply chain resilience. It involves creating a structured framework for monitoring usage, storing fuel safely, budgeting for market fluctuations and mitigating operational risks, such as unwanted downtime or seasonal supply issues. By creating a robust plan, you can manage your fuel more effectively than purchasing fuel on an ad-hoc basis.

Why implement a fuel planning strategy?

Fuel impacts a range of areas of your business – Fuel planning directly affects profit margins, operational continuity and environmental compliance, meaning that poor fuel management can lead to other failures and unwanted downtime.

Fuel is a high-frequency expense – Fuel is a regular purchase for most users, which means that small savings add up, greatly improving the bottom line of a business.

Usage is variable and affects price – For many businesses, fuel consumption patterns are incredibly variable from month to month. That means effective fuel planning is needed to ensure fuel tanks are topped up during busy periods.

Reduce fuel consumption and emissions – Small reductions in fuel consumption can result in significant cost savings and lower emissions, improving the profitability and sustainability of your operations.

It helps create stability – The cost of fuel is both essential and highly variable, which can create instability for businesses that do not manage their fuel supply appropriately. A simple plan can turn fuel from a ‘surprise cost’ into a ‘managed cost.’

It improves forecasting – Fuel planning is essential to forecast expenditure and business growth such as additional vehicles, fuel storage expansion and extra delivery routes. By accurately tracking your fuel consumption, you can project future operating costs and determine cash flow requirements.

Common mistakes to avoid when managing fuel supply

When managing fuel supply there are several mistakes we see organisations making frequently, including:

• Underestimating fuel demand: Many organisations plan fuel supply around average consumption but find themselves short in periods when consumption peaks
• Keeping too little fuel reserves for emergencies: Insufficient fuel reserves can disrupt operations in the event of an emergency
• Overlooking supply chain risks: Ignoring market conditions can result in businesses paying higher fuel prices unnecessarily
• Poor inventory monitoring: Failure to track inventory increases the risk of over-ordering and unnoticed losses
• Neglecting fuel quality and maintenance: Optimum fuel quality can improve fuel system efficiency yet is often neglected by businesses

How can you monitor fuel consumption?

Before you can build a fuel management plan, it’s important to assess how much fuel you’re currently using. Whether you’re monitoring fuel usage manually or digitally with telemetry systems, keeping track of your fuel will enable you to find identify inefficiencies and plan your fuel deliveries around projected consumption.

Methods to monitor your fuel consumption include:

• Manual logging: Calculating fuel economy based on distance travelled or output relative to fuel consumed. This might involve writing fuel levels down or using smartphone applications or AI to automate calculations
• Telematics: Using advanced systems which monitor fuel levels and upload data to the cloud for remote tracking. These include tank telemetry, on-board diagnostics (OBD) scanners, flow meters or GPS tracking devices
• On-road refuelling: Using company cards for all fuel purchases, detailing how much fuel was purchased, where it was purchased and at what cost

The methods you choose to monitor your fuel consumption may vary depending on the nature of your business, and many industries opt to use a combination of all three methods. At Beesley Fuels, we provide a range of fuel management solutions which include monitoring your consumption and automating fuel deliveries.

If you want complete visibility of your stored fuel, our tank telemetry monitoring systems enable you to view your fuel levels remotely by uploading data to the cloud via cellular technology.

If you’re unsure of which fuel monitoring method is right for your business, call 0330 123 1144 today to speak to our experts.

What affects the price of fuel?

There are a number of factors that should be taken into consideration when creating your budget, including:

• Global oil prices: The wholesale price of crude oil drastically impacts the cost of fuel by making fuels more expensive to refine
• Fuel duty and tax rates: Policy changes to fuel taxation can raise or lower prices for businesses
• Seasonal demand: Most businesses use more fuel in the winter which creates more demand for fuel, raising its price
• Quantity required: Purchasing fuel in bulk will reduce the price you pay per litre compared to purchasing fuel in small quantities at forecourts
• Your supplier: Fuel suppliers with vast reserves and direct terminal access will be able to secure supply at cheaper rates and pass these savings onto customers. Some suppliers may also offer fixed contract pricing for greater certainty of cost
• Geopolitical events: Political events or trade deals can affect the global supply, pushing up or lowering prices depending on the circumstances (i.e. the easing or intensifying of tensions)
• Exchange rates: Oil is traded globally in USD which means the price of fuel is also affected by the strength of GBP against the dollar

Building a fuel budget

By tracking the price and usage of your fuel, you’ll also be able to create more accurate forecasts with realistic assumptions of costs and required supply. Here are a few considerations to help you forecast your consumption and costs.

Assess Historical Data:

• What are your historical fuel costs?
• Are there clear seasonal patterns in your consumption history?

Forecast Operational Changes:

• Are your operations likely to become busier?
• Do you have plans for expansion?
• Is your equipment running at maximum efficiency?
• Are there any events which will temporarily increase fuel consumption?
• Are there any ways you can reduce fuel consumption?

Factor in Market Volatility:

• Do you expect costs to rise or fall before your next purchase?
• How sensitive are you to price fluctuations?
• Do you have contingency plans for market changes?
• Would bulk purchasing improve cost stability?
• Are wider market conditions likely to influence fuel costs?

If you’re unsure of how to create a budget for your fuel usage, we’ve put together a simple template which tracks both fuel costs and consumption to help you get started.

Download our free fuel budgeting template

Ways to reduce fuel consumption

Once you understand how much fuel you’re using and how much it is costing your business, the next step is looking for opportunities to reduce consumption. Simple changes to the way you operate can have a noticeable impact on your expenses, particularly when monitored over time.

When managing a busy site, it may seem difficult to identify any methods to reduce consumption which is why we have outlined some starting points below.

Monitor fuel usage

When fuel usage is visible, it becomes easier to find inefficiencies and address them.

By monitoring fuel consumption, you can:

• Identify unusual spikes
• Compare expected vs actual consumption
• Find differences between vehicles, equipment and operators

Reduce unnecessary running time

Idling equipment, vehicles or generators still consume fuel even when they are not actively being used.

To reduce unnecessary running time, you should:

• Switch off engines and machinery between tasks
• Avoid running heating systems outside required hours
• Install smart timers and Internet of Things (IoT) sensors which shut down equipment automatically during off-hours

Maintain fuel infrastructure

Maintaining your fuel systems properly can help to maximise efficiency and fuel economy.

Fuel services which can help to reduce fuel consumption include:

• Fuel system inspections
• Fuel testing
• Fuel polishing
• Lubricant health checks

Improve planning and scheduling

Planning the logistics of your operations more effectively can keep fuel usage to a minimum by:

• Reducing repeated or unnecessary activities
• Avoiding inefficient stop-start patterns
• Improving the sequencing of tasks

Fleet operators may also consider:

• Grouping jobs geographically
• Reducing repeat journeys
• Avoiding congested routes
• Optimising routes to reduce mileage
• Reducing unnecessary carry weight

Enhance fuel security

By installing security measures and inventory management systems you can detect leaks, increase accountability and deter thieves. If security measures are not in place, your fuel could be repeatedly stolen without your knowledge.

Prevent waste while handling fuel

Equipment misuse not only puts staff and the environment at risk but also wastes fuel when spills occur.

To prevent waste while handling fuel, you should:

• Inspect tanks and equipment regularly for cracks or damage
• Train staff on all handling procedures
• Avoid transferring fuel between containers

Using the right lubricants and oils

Engines and machinery contain moving parts that create friction during operation, resulting in overheating, wear and damage if not treated carefully.  Using the specified lubricants or oils for the intended application(s) will help improve equipment efficiency by mitigating these issues.

Lubricants can enhance performance and fuel economy by:

• Reducing friction between components
• Maintaining temperature control
• Reducing wear and damage of parts
• Lowering maintenance costs and need for replacement parts

We recommend that you always check with your vehicle or equipment manufacturer(s) to determine which oils you require. If you’re unsure about which lubricants you need for your business, our team are here to help.

Call 0330 123 1144 today to speak to our technical support team.

Consider how your business uses fuel

Forecasting fuel costs and usage varies by sector and business which is why you must consider how your business uses fuel to determine the best approach. We’ve put together example scenarios below to provide an idea of how your business could manage fuel more effectively.

Large fleet operators

Businesses that use vehicle fleets to handle the logistics of their operations consume large volumes of fuel and employ very different fuel management practices from small business. For these types of businesses, optimising fuel economy is crucial. While fuel costs do not affect profitability as much as they do in small businesses, a small percentage of reduction in fuel consumption can lead to significant cost savings due to the sheer volume of fuel usage.

Ways fleet operators can improve fuel economy include:

• Tracking vehicle fuel consumption with on-board diagnostic systems
• Using high-quality engine oils to maximise performance
• Purchasing fuel in bulk and refuelling onsite to reduce price per litre
• Optimising routes to ensure vehicle mileage is kept to a minimum
• Fuel cards?

Agricultural and rural operations

During the harvest, farms consume large amounts of fuel which means that supply disruption during this period can have devasting consequences for operating costs.

Methods for farms to prepare for the harvest:

• Forecasting seasonal demand early and purchasing fuel in bulk when prices are low
• Scheduling deliveries ahead of peak periods
• Monitoring health of equipment and oils
• Employing contingency plans for emergencies

Fuel for backup power and generators

Fuel reliability is paramount for any organisation that requires backup power in emergency situations. When disaster strikes, the transition from electric to backup fuel needs to be seamless. Dormant fuel left in storage tanks for long periods can degrade and form sludge, clogging fuel systems and eroding tank integrity. Therefore, managing fuel maintenance and planning for emergencies are essential to protect critical operations.

Fuel services which are essential for backup fuel generators:

• Fuel system inspections & tank inspections
• Fuel sampling and testing
• Fuel polishing
• Priority fuel contracts
• Tank and pipework cleaning

Factories, manufacturing and industrial sites

Ensuring continuous operation of production lines is crucial to maximise the profitability of factories and manufacturing sites.

Steps factories can take to protect operations include:

• Getting machine oils checked regularly by industry professionals
• Monitoring fuel storage levels remotely to ensure fuel tanks don’t run low
• Forecasting fuel demand for busy seasonal periods such as Christmas
• Storing contingency fuel reserves in preparation for an emergency

Small businesses and tradespeople

If you operate a small business, fuel might make up a larger portion of your operating expenses and as a result, rising costs are more difficult to pass on to customers. Mileage may also vary from month to month depending on how busy it is or where different jobs are located.

Helpful fuel management tips for small businesses include:

• Grouping jobs/appointments by area
• Reviewing fuel spend more regularly
• Allowing for price fluctuations when budgeting
• Use fuel cards to simplify expense tracking

If you’re unsure of the steps you can take to manage your fuel, call 0330 123 1144 to speak to our experts.

The importance of fuel maintenance

Ensuring your fuel tanks are topped up is just one aspect of managing your fuel supply. With regular maintenance, you can prevent common fuel issues, including:

• Water contamination: Counteract by ensuring tanks are well ventilated and removing water with fuel-water separators
• Microbial growth (diesel bug): Utilise fuel polishing to circulate and filter fuel to remove the water, dirt and sludge that allow diesel bug to thrive
• Fuel degradation: Chemical stabilisers can slow down the rate of oxidation, prolonging the working lifespan of the fuel
• Dirt and sediment buildup: Reduce by monitoring and replacing fuel filters regularly to keep storage tanks cleaner

Fuel maintenance not only preserves the quality of your fuel but also protects your storage tanks and fuel systems whilst enhancing:

• Engine reliability: Keeping flow consistent, reducing damage from sediment, preventing injector failures and improving combustion
• Operational fuel system efficiency: Improving flow by removing sediment and sludge reduces fuel consumption and strain on fuel system components
• Fuel economy: Preserving fuel quality to maximise combustion efficiency and energy density
• Equipment & tank lifespan: Sediment and sludge can erode the integrity of storage tanks and fuel systems. With fuel maintenance, dirt and sediments can be removed from fuel, prolonging equipment lifespan
• Business continuity: Fuel maintenance protects fuel systems from unexpected outages by enabling you to identify issues before they come to fruition
• Profitability: Downtime can have a detrimental impact on business profitability, and fuel preservation is key to preventing unexpected outages
• Regulatory compliance: Any breach of environmental regulations can lead to fines, and in extreme cases, business shutdown. You can ensure breaches don’t occur by preventing leaks and spills

Preventative measures are an essential aspect of fuel management. To develop an effective maintenance plan, call 0330 123 1144 today to speak to our team.

Planning fuel for the seasons

When planning your fuel supply across the seasons, you should consider seasonal performance as fuel properties change based on the temperature. In the winter, common fuels such as diesel can suffer from performance issues including restricted fuel flow, clogged filters and difficult cold starts as a result of the fuel gelling and waxing. These issues can become bigger concerns if the wrong grade of diesel is used. This means that you need to consider tank storage conditions, maintenance services, fuel additives and the grade of fuel you require to mitigate the chances of running into these performance issues.

Winter storage tank conditions

To prepare storage tanks for winter, businesses should:

• Regularly inspect tanks for leaks and damage
• Keep tanks clean and well-ventilated to reduce condensation
• Ensure seals and covers are secure to mitigate moisture ingress
• Use insulation jackets to stabilise fuel temperature
• Keep tanks heated and sheltered from the rain (if possible)

How do the seasons affect fuel maintenance?

During the winter, you should forecast to spend more on fuel maintenance due to the increased likelihood of water contamination and gelling. While expenditure may increase, fuel maintenance can prevent more severe issues from occurring, meaning it should be seen as necessary expense for long-term cost savings.

Summer and winter grade diesel

Diesel is supplied in different seasonal grades to maintain reliable performance throughout the year. Summer grade diesel offers slightly better fuel economy due to its higher energy content, but it is more susceptible to waxing and fuel flow issues in cold weather. Winter grade diesel contains additives that improve low-temperature performance, making it more suitable for winter storage and operation.

Most suppliers switch grades automatically from:

Summer grade diesel: 16^th March – 14^th November

Winter grade diesel: 15^th November – 15^th March

These seasonal changes may influence when you decide to purchase fuel. Businesses with long-term fuel storage, such as backup generator users, may benefit from ensuring winter-grade diesel is in storage before temperatures begin to fall. Higher-consumption users may wish to plan deliveries to maximise the use of summer-grade diesel during warmer months.

If you have summer grade diesel stored as the winter approaches, you should consider the use of fuel additives such as anti-waxing agents to slow down the rate of sludge build up.

Regardless of the nature of your business, our experts are on hand to help you plan your fuel supply across the seasons. Call 0330 123 1144 today to discuss your fuel supply with our experts.