Business Process Optimization in Fuel Stations

There is a misconception about fuel stations all over the world. Since fuel stations are supposed to be amongst the most dynamic businesses in terms of wheel falls, one would think that operating a fuel station would be both lucrative and recession proof. However, it is a business that runs on thin operating margins and largely depends on the efficiency of its operating processes. A thumb rule of the industry says that a fuel station loses 40% of its value in two weeks of non-operation. The operating margins are squeezed by both buy and sell sides of the equation and are predominantly influenced by fluctuating demand and large variable costs that include inventory, supply chain, service delivery and maintenance costs. Therefore the inevitable challenge lies in keeping the variable costs as low as possible.

This empirical study was conducted to find out how fuel stations can increase their profitability by optimizing their business processes parameters like EOQ and mainly deals with various ways to reduce carrying costs and transportation costs by having better reorder points in Motor Spirit i.e. petrol. There is a high scope for increasing profitability by increasing the operating margins and this study deals precisely with that.

This empirical study also develops a generic model that can be applied to any fuel station thereby eliminating the need for station-specific-models and finds out the contributing percentage for each of the factors in increasing the operating efficiency of petrol bunks. With this knowledge, fuel stations can afford to focus their efforts on models that are more profitable, thereby increasing their razor-thin operating margins and hence, revenues. © International Journal of Management and Development Studies (IJMDS)

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Student Achievements

Swati Kaul, PGPM, 2013-14 won the Article writing competition

Swati Kaul, PGPM, 2013-14 won the Article writing competition on the theme “GENDER EQUALITY-Are Mars and Venus treated equally in the corporate universe?” conducted at SWIM 2013, Great Lakes Institute of Management, Chennai

‘The Changing Face of Finance Consultancy: Boutique Investment Banks’ has been published in the May, 2013 edition of IIM- Shillong Conquest Magazine (Consulting Club) as ‘featured article’

Ankur Baj of PGDM (2012 - 2014)

Best silent voice entry for the June, 2013 Edition of Markathon-The Marketing Magazine of IIM-Shillong

Pulkit Kohli and Ankur Baj of PGDM (2012 - 2014)

Winner of Ernst and Young Knowledge Quiz

Lathish Venugopal, Viral Patel. More than 2000 teams across India participated in this

Runners up at TATA Crucible Campus Quiz

Lathish Venugopal and Viral Patel.

Article published in March edition of Markathon – Marketing magazine of IIM- Shillong

Kriti Dua and Sankalp Parihar. The article was on Marketing Trends 2013

Winner at Hyundai Global Youth Marketing Camp

Shouvik Das. The event was held in S.Korea and the team comprising of 4 Korean students, 4 Indians and 1 Chinese student won the award for the Best BTL Strategy

Second Prize for Article writing in NMIMS Banking

Namratha and Mahesh. The article was on “Policy expectations for the Indian Economy” and was published in the BankAge Magazine of NMIMS.

First Place- The Clan,IFMR

Krishnan Chidambaram and Hariharan Subramaniyan. The event was Abhyudhaya, the flagship HR event of IFMR. They competed in the finals against teams from K.J. Somaiya, IIT Madras, BIM, Welinkar and LIBA

I Runner up at Goa Institute of Management

Gajendra Sisodia and Kriti Dua. This was a national level case study competition (Samiksha 2013). Total of 127 teams participated in the event

Article published in NITIE’s In-Fin-NITIE

Manshi Gandhi. The article was on “Quantitative Easing”

First prize in case study competition at SIMC

Harleen Wahi and Abhishek Jain. The case study was a real case of declining sales of next gen publishing magazines a unit of Shapoorji Pallonji & Co Ltd. Great Lakes competed with 11 teams in the final campus round with the likes of SIMS,MICA, NITIE, Narsee Monjee,etc