Fuel prices have reached record levels this year. For companies or self-employed people who operate even a few vehicles as part of their business, the use of fuel cards can bring interesting savings. Today, this tool is also available to small entrepreneurs without obligations to minimum subscriptions. The financial savings can amount to a few crowns per liter of fuel, on the other hand, you have to be careful about the fees that can make refueling really expensive with the big card companies.
With the contribution of the covid pandemic and the crisis associated with the Russian invasion of Ukraine, companies are forced to look for savings wherever they can. Interest in the use of refueling cards is therefore constantly growing. For example, data from the purchasing alliance Axigon, which is an authorized distributor of Shell refueling cards, shows that despite all the market turbulence this year, companies a fifth more fuel year-on-year through refueling cards. In the last two years, the interest in this instrument has been growing to a great extent also among small entrepreneurs and self-employed people. What are the benefits of refueling cards and what should you watch out for?
No commitments to minimum subscriptions
Tank cards are often seen as a tool intended especially for large companies with tens or hundreds of vehicles. Historically, this was indeed the case, and a certain advantage was conditioned precisely by large fuel purchases.
“Nowadays, a refueling card makes sense even for self-employed people who use less than hundreds of liters of fuel per month. A number of smaller entrepreneurs have literally discovered fuel cards with the advent of the coronavirus crisis,” says Damir Duraković, CEO of the Axigon purchasing alliance, which with 10,000 associated companies is one of the largest buyers of fuel in the Czech Republic. “Advantages previously available only to large companies or truckers can be used by smaller companies thanks to demand combined in a purchasing alliance, without having to be bound by minimum fuel consumption,” adds Damir Duraković.
How does the flat fuel price work?
It is precisely the so-called flat prices of gasoline or diesel fuel that are a significant benefit of fuel cards. Unlike a fixed discount from totem prices, the flat price guarantees a favorable fuel price regardless of the location. In the flat price regime, it is possible to refuel at a uniform and long-term below-average price in relation to the market within a given network of gas stations anywhere in the Czech Republic. You will appreciate this especially at highway pumps, where a liter of fuel is up to CZK 7 more expensive compared to the rest of the country, while with the application of the classic discount, you will still refuel significantly more expensively here compared to less exposed locations. “Currently, a liter of Natural 95 on D1 costs almost 44 crowns, and the average price in the Czech Republic is about 40.50 crowns per liter. At the same time, the general price of Natural 95 with the refueling cards provided by us is now, for example, 37.79 crowns per liter in the entire Shell network, including highway pumps. Damir Duraković illustrates the concept of an area award.
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Combination of standard discount and flat price
In contrast to standard prices on racks, which always have a certain inertia, flat prices reflect current market developments. Thanks to this, situations arose in this year’s first and very price-turbulent half-year when it was possible, for example, to refuel in the entire Shell network at a lower price than at the cheapest discount pumps. In the recent period of extreme price fluctuations, however, the opposite situation also occurred, when due to rapid changes, the flat prices were briefly higher than the standard shelf prices. “In such a case, it is possible to ‘switch’ the card from the flat price mode to the classic fixed discount mode from the totem price, which can achieve real savings even in periods of extreme price spirals,” explains Damir Duraković, noting that the discount from shelf prices, for example, in the Shell network for companies associated in Axigon is CZK 1.20/l. However, in the long run 90% of fuel purchases take place in the flat price regime.
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Card company fees can wipe out the discount entirely
Getting a real discount is still not a matter of course these days, especially with large card companies. It can continue to be conditioned by the volume of fuel taken. But there are literally absurdities on the market in the form of a fee for the delivery of a tax document or a fee for the fact that the fuel card was not used for payment during the month.
“If you already use a refueling card, definitely check your bill. In practice, we constantly encounter the fact that even if the company refueled with cheaper fuel, as a result, it paid more than what was the price on the stand of the gas station. This is often due to the so-called service fee, which represents a permanent surcharge on the price of each liter of fuel filled. We have recorded cases where the card company ended up raising the price of fuel for the company by up to 3 kroner per liter. points out Damir Duraković, who also warns against the so-called “opt-out” approach when the card company starts invoicing services that the customer did not order directly, and he must terminate the given service on his own initiative.
Wide acceptance network
An argument to justify the high fees of card companies there is usually a wide acceptance network of refueling cards. Nowadays, however, you have a large network of gas stations they accept each other’s own refueling cards, and so it is usually possible to use the benefits of cashless payments even in competing chains. Ideally, you will pay with a single card at virtually all branded networks in the Czech Republic, without any service fees being charged. This represents more than 1,200 gas stations. Some extra cards allow you to refuel at the same time at another 20,000 locations throughout the EU.
Simple administration and refueling control
In addition to fuel savings, refueling cards are an advantage simpler administration and time saving. Drivers do not have to collect receipts and have cash. At the end of the month, the entrepreneur or company will receive a summary invoice for all fuel and services paid with fuel cards. By automatically importing fuel card transaction data into vehicle monitoring, consumption can be better controlled and fuel theft prevented more effectively. An electronic log book is a matter of course.
You can pay for fuel and other services with a single card
Some card companies provide companies with one card for refueling in the country, another for abroad, or another card for toll payments. But by choosing the right provider, you can have everything one single card and all fuel expensestoll – both in the pre-pay mode and in the post-pay mode, when the toll is paid only afterwards based on the toll sections actually passed – and other services included on one invoice.