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Diesel Fuel Bids?

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Old Mar 1, 2005 | 01:14 PM
  #1  
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Diesel Fuel Bids?

I'm curious as to how to write up requiremnts for one and how to get bids for fuel.

Here's the scenerio: Last summer I interned for a forest preserve, they had a contract with FS for fuel, FS supplied all the equiptment (tanks, valves) and filled the tanks when needed. The forest preserve bought the fuel at a set price

Now, I work for my dad, a wood floor manufacture/ distributer. We have 5 Diesel delivery trucks and some other diesel equiptment. I estimated that our company uses 6000 gallons a year, is this enough for companys to even bid on?
 
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Old Mar 2, 2005 | 12:13 AM
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That is probably enough, BUT, the forest preserve was probably using off road deisel and you will not be able to do that. Other than the color of it there is no difference except regular deisel is taxed and the off road stuff isn't.

6000 gallons, roughly 23 gallons a day (5 day work week), roughly 500 gallons a month. They might but chances are they will supply you fuel at what the current price is, especially with the way fuel prices are going up and expecting to continue going up.

With a buddy of mine that farms he has a contract to get fuel from them and they supply the tank and such at no cost, as long as he gets fuel from them. I believe the price of the fuel itself though is based on what the current price is, we are talking off road deisel here though in this instance.
If I were in the fuel business I don't think I would want to contract for a set price for a year with the way it fluctuates.
 

Last edited by Birdhunter1; Mar 2, 2005 at 12:18 AM.
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Old Mar 2, 2005 | 10:30 AM
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The problem is that he price doesn't fluctuate that much. What you see at the pump is monkey see, monkey do. Station x raises thier prices 5 cents for the weekend. So Stations B and C do it too. Well B and C aren't going to drop thier's first so it stays until station A's drops. When the management of station B call and say "Hey, bump up the price by another 5 cents" Station b does, as do A and C about an hour later. This happens even if A and C never got a call from their head offices. And likewise when you have a station in the area that is selling for 10 cents lower the others have to lower it to compete for the business.
 
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Old Mar 2, 2005 | 10:42 PM
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I had a fuel oil, kerosene, gasoline, and diesel distributor/sales company for 7 years. I would get a fax every morning from the distributor I bought from. It listed the current price for every supplier at the tank farms.

The prices changed every day, sometimes only a few hundreths of a cent, sometimes several cents. During times of extreme price fluxuations I would get a new price sheet twice a day. I have seen prices jump as much as 17 cents at one time, and continue to climb from there. I usually kept 50-100,000 gallons on hand. Many times the replacement price was more than I charged retail for what I had just sold.

If something happened in the middle east, then the price would jump immediately, even on what was on hand at the farms, but when the price was coming down, you had to wait for the fuel to "work its way through the system".

As far as getting a contract for highway fuel with a purchase of 6000 gallons, I don't think anyone will do this. The Forest Service is either a state or federal contract, which will purchase hundreds of thousands, or even millions of gallons of fuel per year. Usually this is handled directly with the fuel company, instead of a supplier. If a customer is only buying a limited amount, then someone may sell on contract, if they can pre-buy the fuel and store it until the customer wants it.

I never liked to deal with any forum of government sales. They want it to their specifications, and at their price, but are never in any hurry to pay you for it.

I always priced large amounts according to I paid for what I had in stock. If the order was large enough to send a tanker, then it was off the price of the day at the farm.

There could be as many as 10 or more companies at the tank farms, and each would have a different price.
 
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