There have been a few new twists in the financing scene that could work to your advantage if your company needs funding:
Alliances – Many of your suppliers have been busy lately forming alliances with specific financing vendors. For instance, Pacific Pride, the cardlock network now has a great discounted financing program alliance with Boulder Capital. If you are expanding your cardlock network, you will likely not find a better deal.
Since these alliance deals are being formed by the minute, your best strategy is simply to ask any vendor you are about to spend money with if they have any alliances. Often local vendor reps are not up on all the news, so be sure to ask them to do a little research before they give you a response.
Refiner Capital – Even small refiners are getting in the financing game. Ask all of your petroleum product vendors about any deals to be had. Koch Refining, for instance, is just now cranking up a financing program tied to volume and repaid on a per-gallon basis.
MAC Programs – Most major fuel and franchise food folks have made major modifications and enhancements to their offerings to stay competitive. Be sure to check out the new MAC terms. You’ll find less restrictions, and higher loan limits in most programs than in past years.
New Lease Terms – If you want to see creativity, just talk to the leasing people. It’s amazing what is out there now, including tank leases that work on per-gallon payback schedules. You’ll even find new choices in depreciation and tax treatment. Don’t forget manufacturer leases on your big trucks either — they are some of the best deals going.
Equity Financing – Private and group investors are beginning to court our industry, particularly the retail sector where they already know how to analyze the numbers from similar industries. The equity marketplace is a bit slower for wholesalers, however, a small trickle of activity is now evident.
When it comes to equity investment in wholesale, be wary of strangers offering deals too good to be true. If you get approached by an equity offer where the principals have no petroleum experience and no track record in mergers and acquisitions in any industry, watch out! The only party that will make money in those regional consolidation grand plans is the equity investor.
In summary, thankfully the sheer numbers and varieties of financing for our industry continue to multiply. When you need money, be sure to check out all the new options. And of course, always read the fine print on any deal you are offered. Remember “the big print giveth and the fine print taketh away!” Read those fine print clauses to stay out of trouble!