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Fleet Cards: Fuel Discount Cards versus Credit Cards

Accutrac Capital 14-Jul-2015 0 Comments Permalink

Trucking Industry: Discount Fuel Cards verse Credit CardsIs your trucking company using a credit card instead of a fuel discount card as your trucking companys fleet card? Then youre paying too much for diesel! Even if you manage to pay the balance prior to 30 days and avoid interest payments, you are still paying too much.

Why? The price of fuel thats posted for all to see on the big sign in front of the truck stop is a cash price only. The pump price for diesel is much higher if paid for by credit card. 

The truth about credit card diesel markups

Your driver sees what is posted in big numbers out front of the truck stop and may think that is today's price per gallon. He would be correct, but only if hes paying cash. The credit card price is higher, anywhere from 5 cents and more per gallon. The website for one of the largest chain of truck stops in North America, posts a current listing of daily fuel prices across all its outlets. Read the websites disclaimer statement however, and youll discover that the prices are listed as the lowest cash price. The price for credit card payment is 6 cents/gallon higher.

Credit Cards are a convenience at great expense

An industry survey showed that almost two-thirds of owner-operators use credit cards for business expenses, including the purchase of fuel. Because of the convenience and accountability, many small to mid size carriers also utilize credit cards for over the road expenses. Seldom is it realized that this convenience is at great expense. 

The companys owner, fleet manager or account payable department is normally just checking for things on the invoice such as the amount of fuel the truck pumped compared to the distance it traveled. Few managers check the diesel purchase price to confirm it matches the posted cash price.

Complete a fuel analysis and see the difference

During a fuel analysis, if you compared posted diesel fuel prices to the price you paid, youd see that youre overpaying with the credit card you use as your fleet card. When paying by credit card, a typical tractor/trailer unit consuming 1,500 gallons per month can spend over $90.00 extra just for the privilege of using a credit card. Thats $1,080 per year more.

Credit card rebates or points do not cover the additional costs

Some company owners get a 1% rebate on purchases on their credit card and think this is a great rewards program. Do the math:

  • 1,500 gallons per month x $3.00 per gallon (posted Cash Price) x 1% rebate = $45.00
  • 1,500 gallons per month x $0.06 per gallon (additional Credit Card price) = $90.00

In this scenario, the rebate is $45.00 but the additional cost for using a credit card is $90.00. Why pay more?

Many company owners enjoy getting reward points for their purchases and justify using their credit card as a fleet card for this reason. Think about what it would cost you versus what you are rewarded:

  • 1,500 gallons per month x $3.00 per gallon x 1 reward point per dollar = 4,500 points
  • 100 points = $1.00
  • 4,500 points = $45.00

If it costs you an additional $90.00 per month per truck to pay by credit card and you only get $45.00 worth of reward points . . . . once again, you are in the hole!

When using credit cards to pay for fuel and other over the road expenses, paying bills off before interest accrues is key. Otherwise you run the risk of digging yourself into a deep and costly hole. A much better payment option for carriers is to use a Fuel Discount Cards.

How Fuel Discount Cards help you SAVE…twice

Fuel Discount Card is a specific type of fleet card, used as a payment card at truck stops. As it name suggests, it provides discount pricing to the card holder. Because it performs similar to a debit card, Fuel Discount cards qualify for the cash price posted at the pump. 

However, because it is a discount card, it further qualifies the card holder to receive an additional rebate off the posted cash price. You receive the Cash Price plus an additional discount. That equals huge savings at the end of each month.

A valuable accounting tool

Fleet cards are a valuable accounting tool due to the convenient and comprehensive reporting that they offer. Fleet cards enable truck companies to receive real time reports, prepare fuel tax reporting and set purchase controls to help them stay informed of all business related expenses.

Choosing the right Fuel Discount Card

Be careful when choosing the right fuel discount card for your trucking company. Only a few suppliers carry all the benefits of a quality Fuel Discount Card. Accutrac Capital provides the ideal fleet card solution to trucking companies of all sizes. 

Whether you have one truck or a fleet of 300 trucks, our Fuel Discount Card program provides immense value to benefit your bottom line:

  • Huge Savings off the Cash Price
  • No Transaction Fees
  • Easy Credit Terms available
  • High Quality Full Service Truck Stops
  • Easy Qualification for any size fleet

Cash Advances

Another huge benefit that separates Accutracs Fuel Discount Card from most other cards is the ability to withdraw cash advances. You and your drivers can easily access ready cash from convenient locations across North America. Now your driver pool has the ability to safely manage cash while on the road while your companys accounting department tracks, monitors and controls each withdrawal.

The spending habits of your drivers and your companys money management will largely determine the success of your trucking company. A credit card may at times serve as a lifeline, but often becomes a financial drain, depending on how it is used. 

Use of a Fuel Discount Card will return huge savings on the cost of fuel, provide easy accountability and allow for cash advances to accommodate for extra over the road expenses.

For more information on Fuel Discount Cards or call us anytime.

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