What You Should Know!

"Knowledge is Power"

As a leader in the petroleum industry, QSO stays abreast of industry trends and changes at both the state and national level. As an active member of the Wisconsin Petroleum Marketers and Convenience Store Association (WPMCA),  Petroleum Marketers Association of America (PMAA), and the National Association of Convenience Stores (NACS), Quality State Oil has the ability to keep its dealer customers aware of legislative and regulatory changes that affect their business.

Quality State Oil has aligned itself with the top brands in the industry.  This connection offers the franchised dealer a conduit to the many programs and opportunities the brand offers.  These include regularly offered consumer incentives, promotions, and dealer programs that can use to attract additional business. 

ULTRA LOW SULFUR DIESEL (ULSD) GUIDE

ExxonMobil has made available a guide which concisely describes the conversion to Ultra Low Sulfur Diesel. It explains the reasons why the change is being made, its requirements, how to implement the change, and the penalties.  There is also a Q&A section that will be helpful when addressing customer concerns.

A packet containing 25 brochures have been sent to all stores. Place them on your counter and use the information to put your customer’s questions regarding ULSD to rest.  If you are in need of additional brochures, feel free to contact Connie Schmitt at extension #321
DEALER MEETING
September 19, 2006

Presentations

Quality State Oil Company hosted their first dealer meeting on September 19th in Manitowoc. Information on the direction of Quality State Oil,    industry updates, and  brand specific information was shared.

Joining the group of dealers were representatives both CITGO, ExxonMobil, and the Wisconsin Petroleum Marketers and Convenience Association (WPMCA).

Scott Stangel of Quality State Oil opened the meeting by welcoming everyone in attendance.  After a brief introductory period he began the opening general session with a presentation of the “state of the industry”.  This update included information on the petroleum and convenience store industries.  Stangel discussed information on current world petroleum supplies, demand, and future supply and pricing trends.  The convenience store update included information from the NACS State of the Industry Report.  Topics discussed included convenience store sales comparisons by category, gross profit averages, industry sales, expense comparisons, and profitability.  He wrapped up the opening general session by putting the industry’s profitability in context with other industries.

Following the industry update Stangel went into the importance and future of electronic communications.  He introduced the group to the Quality State Oil website and the various links within the site.  Next he outlined what the future of the site will be and the use the site as a tool to better serve the dealer customer. Next he emphasized the importance of e-mail communication.  In today’s marketplace the exchange of information is so important in running a successful business.  E-mail exchange is the fastest and easiest way to exchange documents, pictures, website links, and other correspondence that previously was delayed when sent through the mail.

The opening session was concluded with information on the transition to Ultra Low Sulfur Diesel (ULSD).  Marshall McGowan of CITGO briefly discussed the transition and the retailers’ responsibility in meeting the EPA requirements.  He went into more detail in the CITGO brand breakout session.

Following the opening session the dealers broke up into separate brand meetings to hear from brand representatives.  Several topics were covered from fleet card programs, ULSD, target marketing, and facility appearance and management.

After lunch the dealers were joined by Jennifer Badeau from WPMCA.  Jennifer discussed legislative issues important to independent dealers.  First and foremost is the Unfair Sales Act, which she believes will come under attack again in early 2007.  She also discussed the many successes the association has had in the past and the importance of knowing your elected officials and being involved in the legislative process.  Finally she introduced the benefits of membership and the importance of having a strong membership when fighting issues important to dealer operations.

The meeting was concluded with door prizes, special recognition, and a period for final questions. 

Many positive comments were received from the dealers in attendance.  The information on ULSD and the industry information seemed most useful.  Many felt the brand breakout was the highlight and others liked to hear about the important issues going on in Madison.

The Quality State Oil Dealer Team would like to thank everyone who attended and the guest speakers who took the time from their busy schedule to join the meeting. 

TERMINALS READY FOR ULSD  

As required by the EPA Ultra Low Sulfur Diesel is now available at the terminal.  As of October 15th ULSD must be available at retail.

As the industry migrates to ULSD there is a period that is needed to turn over diesel storage tanks.  This means, depending on sales volume, several loads of ULSD must be delivered before the ULSD level of 15 PPM is attained.   Quality State Oil has begun to work with several dealers on this process.  If you are interested in beginning your location please contact Randy Mueller at extension 341 or Cindy Bitter at extension 328.  They can give you the information on the conversion and set up your location for the conversion.

Keep in mind that sales of LSD can continue at retail after October 15th, but the availability will be scarce  When you do make the move to ULSD, you can then only downgrade 20% of your annual volume  to LSD to be incompliance. Also once you reach the 15 PPM (ULSD) it is mandatory that your diesel labeling to changed to reflect this conversion.  (Labels are available through Quality State Oil)  One other thing misrepresenting the product as ULSD, is subject to fines up to $32,500 a day

LOW SULFUR GASOLINE REQUIREMENT

Beginning March 1, 2006  federal regulations requiring the use of low sulfur gasoline go in effect.  The new rule requires that all gasoline sold at retail can not contain anymore than 80 PPM (Parts Per Million) sulfur content.

Recently Quality State Oil issued a letter to all its customers explaining this requirement and how the transition will be handled at retail.  Click here to view the letter.  

This mandate needs the retailers attention to ensure the requirement is met for slower selling grades of gasoline.  

CHANGES OF ULTIMATE VENDOR STATUS-CREDIT/FLEET CARDS

(Courtesy of WPMCA)

 The highway bill contained provisions that modernized the laws determining how excise tax refunds  are paid when fleet cards or credit are used by a government agency to purchase exempt fuel.  Previously the rules were different for diesel and kerosene (ultimate vendor) and gasoline (wholesaler).  The highway bill moved diesel, kerosene, and gasoline to one set of rules, with changes effective January 1, 2006.  Where fleet cards and credit cards are concerned, the party who extends the credit to the exempt agency is consider the ultimate vendor and thus, is the party who claims the refund or credit.    Fleet card or credit card companies must register with the IRS for ultimate vendor status.  If a credit card company fails to register, the company must charge the customer (government agency) the federal excise taxes and the customer must apply for a refund.   As for “in-house” charge sales the ultimate vendor is the retailer , thus the retailer must apply for the tax credit.  To become an “Ultimate Vendor” you must register with the IRS and file form 8849 to receive the credit.

CLAIMS ADMINISTRATOR CREDIT CARD LAWSUIT PROVIDES UPDATE

(Courtesy of PMAA)

 Over the last few weeks retailers all over the country have received claim forms from the settlement administrator distributing money resulting from a lawsuit filed by retailers challenging excessive debit charges.  Merchants are class members if they accepted Visa and MasterCard transactions any time between October 25, 1992 and June 21, 2003.

At the request of lead counsel, the judge overseeing the settle has extended the time for class members to challenge or accept their estimated cash payment and submit claim forms to 90 days.  Class members who received a claim form with an estimated cash payment (VM1) now have until December 28, 2005 to submit their claim form or to challenge their estimated cash payment amount.

Merchants that receive both a claim form with an estimated cash payment (VM1) and a claim form that does not contain an estimated cash payment (VM2) should disregard the VM2 claim form and complete the VM1 claim form.

Assistance with any aspect of the claim process is available by calling 1-888-641-4437 or visiting the case website at http://www.inrevisacheckmastermoneyantitrustlitigation.com  

ETHANOL: BLENDING

If you are currently selling an ethanol blended product or considering it in the future, below are some necessary steps that must be taken to ensure a smooth transition.

General Scope

  • Remove any measurable water from tanks

  • Install new filters on dispensers

  • Repaint fill covers

  • Obtain water finding paste and decals required for ethanol blended gasoline

  • Remove water from tanks

  • Remove any measurable water at the fills

  • If access is available, check for tank slope and water at this location

  • Dispose of water per local regulations

  • Install new filters

  • Replace filters on dispensers

  • For Gilbarco and Wayne MPD dispensers use Petroclear 40510A filters

  • For Gilbarco Advantage or Encore dispensers use Petroclear 40510A-AD filters

  • Inspect the dispensers and correct any observed weeps or leaks

  • Repaint Fills

  • Fills should be repainted as necessary following API 1637 standard

  • Obtain Sargel SR 160 water finding paste suitable for ethanol blends

  • Install “Contains 10% Ethanol” decals

  • Decals must be placed on the front of the dispenser where they are clearly visible by the consumer

DID YOU KNOW

What are the penalties for underage sales of alcohol and tobacco in Wisconsin?

TOBACCO SALES

Violators will be subject to a fine of up to $500 for the first offense within one year, $200-$500 and a license suspension for 3 days for the second offense within one year, $200-$500 and a license suspension for 3-10 days for the third offense within one year, and $200-$500 and a license suspension for 15-30 days for the fourth offense within one year.

ALCOHOL SALES

A person selling or furnishing alcohol beverage to an unaccompanied underage person is subject to a forfeiture of not more than $500 if the person has not committed a previous violation within 30 months of the violation nor more than $500 or imprisoned not more than 30 days or both for a subsequent offense within 30 months of the violation.

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