Author: Tony Burgess (Director – Merchant Network, fuelGenie)
The UK’s fuel market may be about to reach a major turning point, with the introduction of a new government-backed scheme aimed at stopping supermarkets and fuel retailers from allegedly overcharging motorists.
The announcement came after the CMA revealed that the average supermarket fuel margins rose by 6p per litre between 2019 and 2022. Currently, retailers and supermarket forecourts only provide information on fuel prices at the actual petrol stations, which makes it hard for drivers to compare costs and weakens competition.
The launch of a fuel finder open data scheme would mean that fuel retailers will be required to supply current pricing information and make it accessible to drivers in a user-friendly format, such as satnavs or a dedicated fuel finder app. However, legislative support would be needed for it to come into full effect.
The potential
The scheme could have a profound impact on how drivers make informed refuelling decisions, allowing them to compare up-to-date prices so they can find the cheapest option and plan their travel accordingly.
This initiative, along with a new ‘fuel monitor’ oversight body which would also be set up to scrutinise prices on an ongoing basis, will address long-standing issues on the lack of transparency around fuel prices, which has left motorists and business owners feeling disadvantaged.
It could well be that these proposed changes have the potential to change the dynamics of the industry and benefit all stakeholders involved, from commuters and couriers to fleet managers and small business owners, as well as, of course, fuel card holders.
Promoting accountability and a transparent market
For far too long, drivers have been left frustrated by the uncertainty of fluctuating fuel prices, often finding themselves at the mercy of market dynamics and unable to make informed decisions about where to fill up their tanks.
One of the most significant impacts of the fuel finder scheme is the requirement for supermarkets and fuel retailers to update and publish live prices, which effectively eliminates the potential for arbitrary price hikes, ensuring fair competition in the market. With real-time price information available to all, fuel retailers will be held accountable for their pricing strategies and decision-making.
This represents a paradigm shift in the fuel market that advocates transparency within the industry. By promoting a fuel market that is more open about its pricing updates, where information is readily available to everyone, the scheme fosters an environment that benefits not only drivers, but also the industry as a whole.
Putting motorists back in the driver’s seat
The fuel finder scheme brings a plethora of advantages for drivers, who will no longer feel at the mercy of sudden price increases and opaque pricing strategies. Instead, they will be provided with up-to-the-minute fuel price information, enabling them to compare prices across multiple stations in real-time.
This newfound level of transparency will empower drivers to make cost-effective choices, ultimately saving them both money and time. By accessing this information through their smartphones or navigation systems, drivers will no longer be caught off guard by unexpected price increases. They’ll be able to plan their refuelling stops more strategically, ensuring they are paying a fair price for their fuel.
It’s not just motorists who stand to benefit from these developments. Transparent pricing will also be welcomed by fleet managers and small business owners operating on tight budgets. Fluctuating fuel prices can present significant challenges when projecting expenses, but transparent pricing will enable owners and managers to plan for operational costs more accurately.
An opportunity to rebuild trust and build new bridges
While it makes sense to assume that its introduction is only going to penalise them in the long run, fuel retailers actually have a lot to gain from the fuel finder scheme as well. By embracing pricing transparency, they can put the building blocks in place for rebuilding customer trust and loyalty.
This scheme provides an opportunity for fuel retailers to differentiate themselves. Offering competitive prices and ensuring fair competition can be decisive factors for motorists when choosing where to refuel, ultimately attracting more customers and driving business growth.
There’s also a digital benefit that could be easily overlooked. The fuel finder scheme effectively provides collaboration opportunities between fuel retailers and technology providers. For a fuel finding platform to be delivered, retailers would have to partner with app developers to ensure their pricing data is easily accessible to drivers.
This collaboration can lead to mutually beneficial relationships, resulting in increased brand visibility, expanded customer reach, and access to valuable consumer insights. It opens doors for retailers to explore innovative ways to engage with customers and enhance their overall offering.
For example, fuelGenie’s own app already allows drivers to pre-emptively look up fuel prices at the nearest fuelGenie and fuelGenie+ eligible petrol stations, which makes for easier journey planning.
Time to turn the corner?
The introduction of the fuel finder scheme clearly has the potential to subvert UK fuel market. Both supermarkets and fuel retailers are currently being urged to back the scheme and now have until August to voluntarily start sharing live prices to prevent overcharging motorists further.
It is in all effects a call to embrace a transformative change, a paradigm shift that promotes a more transparent fuel market that benefits everyone involved, from drivers to businesses and fuel retailers alike.
By empowering drivers with real-time fuel price information, the scheme will allow drivers to make informed refuelling decisions, ultimately saving them money and time. Moreover, it compels fuel retailers to adopt transparent pricing strategies, fostering fair competition and accountability within the industry.
While it may still be early to get a clear view on where the UK fuel market will end up, it is safe to say that it’s moving in the right direction.
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