Resourcing in the New Normal – Utilizing outside Resources to Augment During Turbulent Times


Resourcing in the New Normal – Utilizing outside Resources to Augment During Turbulent Times

Resourcing in the New Normal – Utilizing outside Resources to Augment During Turbulent Times

In times of significant change or in a turbulent marketplace, it can make sense to engage with an outside company for specific tasks to support under-resourced departments or offload functions that may keep internal teams from focusing on what is essential. For organizations that buy fuel in bulk, utilizing an outside company to reconcile fuel invoices is an option better than trying to do it in-house. Verifying an invoice is difficult. You have the inherent complexity of fuel invoices coupled with pricing, freight, and tax implications, not to mention the sheer volume for some businesses.


Fuel Invoices are complicated

Chief among the reasons that it can make sense to partner with another organization related to fuel invoicing is that bulk fuel invoices can be pretty complicated, with many factors going into each one. In addition to product pricing, elements of the invoice include taxes, environmental fees, and freight charges. With each invoice amount typically over $10,000, a significant amount of money is at stake if there are errors. Ensuring proper billing means the above-mentioned factors must be checked for product, pricing, and delivery accuracy. Inaccuracies can impact freight rates and taxes depending on when and where the fuel is sourced and delivered.  


Profits and tax liabilities

Fuel invoices can also have significant implications for fuel profits, corporate profits, and tax liabilities if incorrect. According to a survey in 2014, fuel invoice error rates tend to hover around 25%; this has far-reaching implications for companies that purchase large quantities of bulk fuel. Examples of these errors include incorrectly calculated fuel tax due to a mistake or a load of fuel sourced in one county being delivered to another county where the rates are different. Another example where fleet-based companies must be diligent is distinguishing between on-road diesel and off-road diesel; failure to keep these separate and distinct can result in tax ramifications. Fuel invoices can have a far-reaching impact on profitability and tax liability if inaccurate. Verification of each invoice for all pricing factors is the only way to ensure accuracy.  


Focus on the core of the businessresearch_notes

Bulk fuel invoice verification is an excellent example of where outsourcing can be an ideal solution versus keeping the function in-house. Invoice volume, the complexity of verifying, and the verification process's length increase the chances of errors and company costs. Outsourcing this function to a company with a system that automates this process makes invoice verification efficient and cost-effective. Organizations that do not have resources dedicated to this task can put a real strain on the business and shift resources away from the team's core focus tasked with that task.
Getting help when you need it
Profitably operating a successful fleet or retail fuel business takes a tremendous amount of work and expertise. While fuel is paramount to both types of business, each will have different considerations related to fuel purchasing. For example, some fleets will have a stronger focus on fuel card transactions and managing expenses around that program. As a result, managing bulk fuel purchases, while necessary, may not get the priority it deserves.  

Fuel is the business for a retail fuel operation; however, high volume fuel purchases can quickly shift a fuel team's core focus to instead verifying invoices. A fuel team's focus may include the management of fuel margins and fuel pricing. They may also be responsible for assuring high-volume retailers are well-stocked -- a vital task especially during high-demand windows where clients may seek a competitor if there is a shortage at their regular retailer.   


When outside support makes sense

Unless organizations that buy fuel in bulk have a reconciliation team, utilizing an outside company to reconcile fuel invoices may be a better option. The amount of data going into each invoice takes careful verification to ensure the purchases match what was ordered by the business. It is hard to overstate the importance of checking each invoice for accuracy. However, if there is no dedicated team verifying these transactions, they will likely be spot-checked, and errors will get missed; inaccurate invoices can lead to negatively impacted profit margins. Given these factors, it makes sense for many businesses to outsource with someone specializing in these tasks, freeing them up to focus on the core of their operations.



Greg Salverson
Vice President of Managed Services at Insite360

Greg Salverson is a cloud software executive who has a passion for business development, managing high performance teams and growing companies into industry leaders. Greg has spent nearly 20 years in software development, support, implementations, quality assurance, solution engineering (Pre-Sales), business development and management with PnL responsibilities. He enjoys aligning people, processes and technology to deliver tangible value to our clients and partners while also exceeding year over year top line growth & operating profit targets.


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