Oil Prophets

What’s Inside: Meet Your New P&CMA Chairman General Membership Meeting & Holiday Dinner Photos

Winter 2010

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WINTER 2010 OIL PROPHETS

ChairmanMitzi WestWest Oil Company, Inc.Winfield, AL

Vice ChairmanA. Stratton OrrPetroleum Sales, Inc.Decatur, AL

Secretary/TreasurerDean MackTurner Oil Company, Inc.Wetumpka, AL

Immediate Past ChairmanMichael A. MintoMinto Energy CorporationMobile, AL

Directors with TermsExpiring in 2010Sam GibsonGOC, Ltd.Butler, AL

Shayne LordR. S. Lord, LLCTroy, AL

Loring PerezChattahoochee Oil Company, Inc.West Point, GA

Directors with Terms Expiring in 2011Mickey CrewCrew Distributing Company, Inc.Opp, AL

Mints McGowinMax Oil Company, Inc.Greenville, AL

David MeltonQuality Petroleum, Inc.Birmingham, AL

Directors with TermsExpiring in 2012Phil BaggettBaggett Oil CompanyFlorence, AL

Rahim Budhwani6040, LLCHoover, AL

Kris PierceJet-Pep, Inc.Holly Pond, AL

STAFF President Arleen Alexander, CAE

Director, Member Relations Lynne Coker

Director, Industry Relations and Meetings Lauren Hodge

ASSOCIATION LEGAL COUNSEL H. Dean Mooty, Jr. Mooty & Associates, P.C. 600 Clay Street Montgomery, AL 36104 334/264-0400 334/264-0380 Fax

P&CMA OFFICERS & BOARD OF DIRECTORS

P&CMA Antitrust Policy All meetings and activities organized and endorsed by the P&CMA observe and strictly adhere to all provisions set forth in the Sherman Act, The Federal Trade Commission Act and all other applicable antitrust laws.

Published for: Petroleum & Convenience Marketers of Alabama 4264 Lomac Street Montgomery, AL 36106 Mailing Address: P. O. Box 231659 Montgomery, AL 36123-1659 Phone: 334/272-3800 Fax: 334/272-3837 Web: www.pcmala.org

Features06 Meet Your New P&CMA Chairwoman08 P&CMA General Membership Meeting in Birmingham15 Commercial Driver’s License Award Ceremony18 Meet Your New Board Members24 2010 P&CMA Sponsor Program25 P&CMA PAC Contribution Form26 Risk Management Strategies – Steer Clear of Winter Driving Risks

Departments02 Chairman’s Comments03 President’s Perspective04 Legal Corner12 Business Strategies17 Regulatory Corner23 2010 P&CMA Annual Sponsors27 New P&CMA Members28 Calendar of Events24 Advertiser Index

Contents

Published by: Creative Marketing Concepts 1085 Chesson Hill Drive Fitzpatrick, AL 36029 334/725.0093 Fax: 334/272.3837

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Published February 2010

OIL PROPHETS WINTER 2010

Chairman’s Comments

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Take Advantage of Your P&CMA Membership

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appy New Year, and thank you for electing me as your Chairman for year 2010. It is true a privilege and honor to undertake this role, and I look forward

to serving you and the association in the coming year. I, like many of you, grew up in this industry, and I hope my years of experience will be an asset to the association.

As we face a new year, both as an association and in our own businesses, I ask you to remember why you are a member of the Petroleum and Convenience Marketers of Alabama. The P&CMA represents, advocates, educates and promotes the petroleum marketing industry in Alabama better than anyone. No one else cares about your business as much as P&CMA does. Last year was quite a year. We had some wins, but our industry continues to face some extraordinary challenges. And, as the saying goes, only the strong will survive.

That’s why it’s so important that as an industry and an association that we have a strong and vital membership – that we are able to send a message to the State House that will protect our right to sell motor fuel at a fair competitive price and be allowed to make a reasonable profit; that we are not accused of price gouging every time there is a wholesale price increase in gasoline during a hurricane; and that we are well-represented when unfair regulations are enforced on our stores and businesses. A strong united industry voice is far more powerful than many fragmented and incomplete arguments. And while P&CMA may not always be able to find an ideal solution to our issues and concerns, it certainly isn’t for the lack of trying.

So I encourage you, as members of P&CMA, to become more involved in the association this year. Your membership is more than sending a check to Montgomery every year. Take advantage of your membership. Utilize the staff and the resources they have available; call on them, or any member of your board of directors, when you have questions or concerns.

Attend the meetings and events that the association puts on during the year. I hope you’ve made plans to go to Biloxi on

February 2-4 for the Gulf Coast Food & Fuel Expo. Take advantage of the Driver Safety meetings in March. Bring your family to Sandestin this summer on July 8-11 for our Annual Convention. Play and be a sponsor in the Fall Golf Classic on September 20.

Support our associate members. Refer to the P&CMA Buyers Guide in your membership directory when looking for products or services to run your petroleum marketing business or convenience stores. Encourage vendors and suppliers who aren’t members of the association to join P&CMA and participate in the Gulf Coast Food & Fuel Expo, Annual Convention and Fall Golf Classic.

Finally and probably most important this coming year, support the association’s political action committee (PAC). It is critical now, more than ever, that we have a strong PAC. We need to be able to support candidates in this November’s statewide elections who support our industry and small business in general. On page 25 of this issue of Oil Prophets is a PAC Contribution Form. Please fill it out now and mail it to the association. Make an investment in your business’ future by making a contribution this year to the P&CMA PAC.

Finally, if I can ever be assistance to you, I hope you will call or email me. Again, I look forward to working with all of you this year. Thank you for your support.

Sincerely,

Mitzi WestP&CMA Chairman


President’s Perspective

I’m Thankful

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ecently, at a Sunday service, the Deacon at my church gave a simple but beautiful sermon on what we should be thankful for in our lives by reading a poem. As we

start the new year, I thought I would ‘simply’ share this poem with you.

~~~~~I’M THANKFUL…

…for the alarm that goes off in the early morning hours,

because it means I am alive.

…for weariness and aching muscles at the end of the day, because it means I have been capable of working hard.

…for my shadow that watches me work,

because it means I am out in the sunshine.

…for the taxes that I pay, because it means that I am employed.

…for the clothes that fit a little too snug, because it means I have enough to eat.

…for the teen-ager who is complaining about doing dishes

because he is at home and not on the streets.

…for the mess to clean up after a party, because it means that I have been surrounded by friends.

…for a lawn that needs mowing, windows that need cleaning

and need fixing,because it means I have a home.

…for the lady behind me in church that sings off key,

because it means that I can hear.

…for all the complaining I hear about the government, because it means that I have freedom of speech.

…for the parking spot at the far end of the parking lot, because it means I am capable of walking

and that I have been blessed with transportation.

…for my huge heating bill, because it means I am warm.

~~Author Unknown~~~~~

Let me simply add, I’m thankful the opportunities this association has presented me with over the past ten years. I’m thankful (and proud) to represent an industry of hard-working, dedicated small businessmen and women. I’m thankful for the leadership and direction provided by our Board of Directors. I’m thankful for the wonderful relationships and friendships that I’ve developed through this association and industry. I’m thankful for the chance to work with a great staff and legal counsel. I’m thankful for each one of you, as members of the Petroleum and Convenience Marketers of Alabama. Have a great year. Call us if you need us.

Sincerely,

Arleen A. Alexander, CAEPresident

P&CMA staff members, Arleen Alexander, CAE, and Lauren Hodge joined ACAE members on a Habitat for Humanity project in Biloxi, MS last October.


Legal Corner

Protecting Your Supply ContractsH. Dean Mooty, Jr., Mooty & Associates, PC

1 This presentation was given at the P&CMA General Membership meeting in Birmingham in December. It is reprinted here based on the many questions and comments raised by those in attendance.

2 As an analogy, it is exactly what major oil companies do with the advancement of image and incentive monies. They amortize those monies over typically a 10-year period that allows them a predictable return on their investment from rack margins they make on fuel supplied to those branded sites.

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In recent articles we’ve discussed protecting your “receivables” as well as protecting your business and personal assets in general. Briefly I want to discuss

protecting your fuel supply contracts. Unless you are a marketer, who supplies only its own locations, your supply contracts are the “lifeline” of your business.1 As much as discussing how to protect your supply contracts, I also want to address some pitfalls that await a marketer who attempts – successfully or unsuccessfully – to take a dealer away from an existing jobber under a written supply contract.

First, by definition, the supply contracts are the heart and soul of a jobber’s business. Historically, most are for 10 years and are of great significance to your business, including budgeting and long-range planning issues. It is a predictable – hopefully – income stream (fixed or otherwise) for the life of the contract. That income stream is itself an asset (a receivable) that can be used as collateral to borrow money. Hopefully it allows a return on any investments you might have at the location such as pumps, tanks, and canopies. It can help facilitate budgeting/planning, assistance for debt retirement and so forth. Of course with branded locations, good supply contracts provide stability that is critical to protecting against the liability exposure for image/incentive money obligations to major oil companies.2

In any event, you’ve got to protect your supply contracts. In both protecting your existing supply contracts as well as being an effective marketer of your business in obtaining new supply contracts with new businesses, there is an area of the law of which all marketers must be aware. There is a tort recognized at law and known as “tortious interference with business relationships.” What does this have to do with your supply contracts? In a nutshell, if there is a dealer under written supply contract with another jobber and you approach that dealer and convince him or her to leave, or breach that contract with its existing supplier and sign a contract with you, you create a rather classic case where you may be liable for tortious interference with a business relationship. This is a common and wide-ranging issue in the petroleum industry. I expect that I receive a couple of calls a month either from a jobber complaining that another jobber is calling on his contract customers; a jobber wanting

to know if he can deliver fuel to a dealer he knows is under contract to another; or the dealer who typically needs a load of fuel and wants to know if they can buy from someone else other than their contract supplier. In all these scenarios there are “be carefuls” for everyone. What is the typical scenario? The typical scenario is a dealer calls you and says it needs a load of fuel and can you deliver one immediately. Their line is virtually always the same: (1) They need a load of fuel, (2) “My current supplier is jerking me around,” (3) “My current supplier is o.k. with my getting a load of fuel from you,” (4) “I don’t owe them any money,” or (5) “My current supplier has breached my supply contract, and I have the right to buy a load of fuel from you.” Nine times out of ten, every one of those statements – save one – is not true. The only true statement they’ve made to you is that yes, they do need a load of fuel. Almost always, the current supplier is owed money by the dealer. The current supplier is NEVER O.K. with its contract dealer getting a load of fuel from someone else. Finally, there are always two sides to the story that the contract supplier is jerking them around and/or has breached the contract. What should you do if you are contacted by a dealer wanting a load of fuel that you know or have every reason to believe is under a written supply contract with another marketer? First, you should demand that the dealer get a release from its current supplier. That is a process that you should stay out of if at all possible. Such a release is one you are rarely, if ever, going to get. The only circumstance in my mind where a current supplier would give you such a release is where that current supplier is so fed up with that dealer that he is more than happy to let him go do business with someone else. Even in that scenario, however, if the current supplier is owed money or has an investment at that location, you are not going to get that release unless those obligations are addressed satisfactorily to the current supplier.

WINTER 2010 OIL PROPHETS 5

Second, you should get an indemnity agreement from the dealer that essentially says that it will indemnify you against any claims the current supplier or anyone might make against you if you begin supplying the dealer with fuel. Remember, such an indemnity is worth no more than the persons or entity giving it, so oftentimes such an indemnity agreement provides little comfort. My advice is almost always that without an express release from the jobber under contract to that dealer that he’s o.k. with you supplying the dealer with fuel, you should leave it alone.

The other scenario is where you, as a jobber looking for new business, call on a dealer that is currently being supplied under contract by someone else. If you do so with full knowledge that such operator is under contract to someone else, not only do you subject yourself to civil damages, it is – in this humble lawyer’s opinion – UNETHICAL. As a lawyer working largely in this industry for most of the past 25 years, I know that the typical pitch to that potential new business includes the following: “You are unbranded. This is a great location for a Chevron store (or BP or Shell or whatever).” “My branded supplier will make available to you a whole bunch of image and incentive monies that will allow you to really fix this place up which can increase your business and double your volume, etc., etc.” “What’s your current supplier charging you for fuel? A nickel over his cost? I’ll sell to you at two-cents over cost!” “I have my own trucks. You’ll get your fuel quicker, and when you need it and there will never be delays.” And worse, “You don’t want to be doing business with that jobber. They’ve got a bad reputation in the business. You’d better check your invoices because they’ll overcharge you, short your fuel drops, etc., etc.”

Never allow yourself to be the jobber making these kinds of pitches to a potential piece of business. Is it o.k. to go in and ask what their current supply contract relationship is and with whom? Of course. However, the line between being a good businessman looking for new opportunities and being guilty of tortious interference with a business relationship can be crossed very, very quickly. There is nothing wrong with determining that a dealer is in the ninth or tenth year of a 10-year supply contract and that their current contract will be up in the next 12 to 24 months. There is nothing wrong with telling that dealer that you would like to talk to them about becoming their supplier at the end of their current supply contract. However, anything that encourages, explicitly or implicitly, that dealer to leave its current contract supplier and come do business with you will open you up to civil liability. The proof is quite easy and the calculation of damages rather simple. Under the

claim of tortious interference with a business relationship, you can be liable for not only economic damages which consist essentially of the money the current supplier would have made had its contract been honored to its termination, but because of the nature of the tort, it exposes you, or allows the jury to consider an award of punitive damages. A simple example of the economic damages is as follows: Take a site doing 60,000 gallons per month historically. Assume the current supplier has a two-cents per gallon wholesale markup. 60,000 gallons times two-cents per gallon equals $1,200.00 per month times 12 months equals $14,400.00 per year and multiply that times the number of years remaining on the contract at the point you convinced that dealer to leave that supplier and come to you. For example, if there were seven years left in this example, economic loss damages would be $100,800.00. If the current supplier could show that you knew or had every reason to know that its contract dealer was under a written supply contract with it, the plaintiff is going to be able to have the issue of punitive damages go to the jury based on questions of intent or willfulness and then you are exposed to the veritable “black hole” of punitive damages.

So consider these two issues carefully. One is protecting your supply contracts and two, being careful not to interfere with someone else’s supply contract. Your leverage as a jobber with dealers under written supply contract is those dealers not being able to get fuel elsewhere. You want them to have to deal with you if they owe you money, or if there are other relationship problems that have arisen that need to be resolved. It is simply too easy an out for them if they can simply go get fuel somewhere else. Most importantly, before accepting a piece of business that may be under contract to another supplier, always (1) BE CAREFUL and (2) CALL YOUR LAWYER.


he is a woman who loves to cook, enjoys knitting and spends most of her time running a large oil company and convenience store chain. Seems

an unlikely combination, but Mitzi West does all of this with finesse.

Mitzi’s grandfather started West Oil Company in 1934. After joining the company in the 1960’s, her father Harold soon began running the operation. In 1986, Harold West formed Token, Inc., which now boasts 16 convenience stores. Today, he has the opportunity to travel often as he leaves the business in the capable hands of his daughter, Mitzi.

Mitzi grew up in the business with her father. “I have worked in some capacity in the business for as long as I can remember,” says Mitzi. She remembers sweeping the docks and helping out wherever she was needed as

she was growing up. Mitzi earned her bachelors degree in education at the University of Alabama while working at West Oil Company and Token, Inc.

When Mitzi returned to the business from the University of Alabama, she spent time working in some capacity in each department. Eventually, she became a manager in the business. Callers who have questions regarding oil are sometimes surprised to talk to a woman. But Mitzi learned from the master. She says before she makes a decision she thinks, “What would daddy do?” Mitzi says she has worked alongside her father for so long that she just knows how he would handle things. Sometimes, when he suggests that she might want to do something differently, she responds, “It’s worked your way for all these years, why would I want to change it?”

Regarding her life, Mitzi says, “I spend most of my time at work.” But when she is away from work, she enjoys cooking and needlework. Friends love to be

Meet Your New P&CMA Chairwoman:Mitzi West

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invited over to taste Mitzi’s cooking! Recently, Mitzi taught the ladies in the office to knit. Soon, they joined a contest between the University of

Alabama and Auburn University to see who could knit the most baby caps to benefit the babies in neonatal units. It became an exciting and competitive event led by Coach Saban’s wife, Terri. After the competition ended, wondering what they could do next, Mitzi found a source for them to supply chemo caps to the cancer clinic in Winfield.

Away from work, Mitzi also showers love upon her pets including her two beagles Sumter and Isabella. Sumter was a stray who wandered into West Oil Company one day. Harold West laughs, “Walking into Mitzi’s office was the smartest thing that dog ever did.”

The West’s have a family farm where Mitzi enjoys getting away and relaxing. The family enjoys fishing the pond. According to Harold, “Mitzi likes to fish if it is not too hot, if there are no mosquitoes, and if she doesn’t have to bait her hook or take the fish off the hook.”

Mitzi is also following in her father’s footsteps in P&CMA. Harold has been actively involved in the association for many years. Mitzi believes that her membership in P&CMA helps her business in many ways. The association keeps her informed about legislative issues affecting the industry. P&CMA serves as the voice of business owners regarding legislative issues. She also believes the association helps the business by keeping her informed about issues regarding weights and measures or information from ADEM.

As Chairwoman of P&CMA in 2010, Mitzi’s vision for the coming year includes staying active regarding legislative matters and increasing membership. She hopes to help the association reach out to non-members and show them the benefits of being a member of P&CMA.

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New Board Members Elected At P&CMA General Membership Meeting in BirminghamP&CMA’s General Membership Meeting was held Wednesday and Thursday, December 9-10, 2009at The Wynfrey Hotel in Birmingham. Wednesday evening began with the association’s General Membership Meeting. After hearing from P&CMA Chairman Mike Minto on the “state of the association,” officers and board of directors for 2010 were elected by the membership. The following were elected to the association’s Board of Directors:

Chairwoman Mitzi West West Oil Company Winfield

Vice Chairman A. Stratton Orr Petroleum Sales, Inc. Decatur

Secretary/Treasurer Dean Mack Turner Oil Company Wetumpka

Directors with Terms Expiring in 2012:

Phil Baggett Rahim Budhwani Kris PierceBaggett Oil Company 6040, LLC Jet-Pep, Inc.Florence Hoover Holly Pond

Recognition and thanks were also given to those board members who completed their terms of service this year on the P&CMA Board of Directors. Those members were Red Knott with Henry Oil Company; Dean Mack with Turner Oil Company; and Mike Segrest with The Spencer Companies.



The Associate Board also held their board meeting prior to the membership meeting and elected the following individuals as their officers and directors for the year 2010:

President Zane Hood PPM Consultants, Inc. Birmingham

Vice President Sean Halcomb Royal Cup Coffee Birmingham

Secretary James Cochran Buffalo Rock/Pepsi Birmingham

Directors with Terms Expiring in 2012:

Deborah Jones Jeff Parnell Carroll SandersQORE Property Sciences Payliance W.L. Petrey WholesaleHuntsville Prattville Montgomery

Recognition and thanks were also given to those members of the Associate Board who completed their terms of service. Those members were John Beck with MECO (Montgomery); Shane Heist with Associated Distributors (Baton Rouge, LA); and Rick Thompson with Montgomery Coca-Cola Bottling Company, (Montgomery).


OIL PROPHETS WINTER 2010OIL PROPHETS WINTER 201010


Following the election of the board members, newly-elected P&CMA Chairwoman Mitzi West made her remarks emphasizing the importance of member participation in P&CMA. Ms. West then recognized Arleen Alexander for ten years of service to the Alabama Oilmen’s Association and the Petroleum & Convenience Marketers of Alabama.

After the membership meeting, attendees enjoyed cocktails and dined on a delicious dinner buffet, all while making the most of the opportunity to network with friends and colleagues. This year’s entertainment, the Hot Tamales, helped usher in the holiday season with their beautiful voices and witty humor.

On Thursday morning, the Petroleum Marketers’ Educational Seminar featured three presentations: 1) PCI Compliance Update- What You Need to Know, 2) Energy Act 2005…Where Are We Now?, and 3) Tortious Interference With A Business Relationship; the ‘Be Carefuls’ of Fuel Supply Contracts. Handouts from these seminars are available by contacting the association office.

The P&CMA General Membership Meeting & Holiday Dinner was well-received by all who were able to attend. We hope that those who were unable to join us will make plans to do so next year.

Canopies and Building Mansards

Keith Chambers - OwnerDavid Thomas - OwnerShafford Henderson – Sales

P.O. Box 526Clanton, AL 35046

Phone: 1-800-932-4549Fax: 205-755-8266Cell: 205-217-0805

101 Shadetree DriveClanton, AL 35045

Email: [email protected]



Business Strategies

Success Starts With Successful PlanningBetsi Bixby

Now is the time to put plans in place for the new year and to apply the lessons learned from successes and failures

to chart your course. The industry as a whole weathered last year well, but not without a few casualties.

Take your team through the following process to clarify your lessons learned from the past year. The task of the team is to 1) create a success list, 2) develop a lessons learned list with subsequent actions, 3) analyze direct competitors, and 4) identify strengths. Then, using these four lists, develop a priority action plan with benchmarks for the coming year. Ideally, get the team off-site, undisturbed for a full day of focused brainpower.

Create a success list. This is not the time to concentrate on reduced volumes or lack of profits. It’s acknowledging that while the seas got rough, the ship kept sailing! What did you and your team do well? Did you put new focus on credit policies and procedures that are now working smoothly? Did you focus on truck and driver efficiency that has now translated into lower cost-per-gallon delivery expense. Did you see that cash was king and reduce or eliminate debt? Did you eliminate marginally profitable sectors so you could focus on areas that were making money? Did you grow your customer base as others shrunk?

As you develop this list, be aware of whether or not your company celebrated these successes. One of the things we know about great companies is they are masters at acknowledgment and celebration. It’s likely your present staff worked harder this year and persisted through really tough times. As a company, did you take time, that momentary breather as a team to bask in the light of glory for at least a moment?

Develop a “Lessons Learned” List. I don’t think I’ve talked to one CEO who after seeing the past year hasn’t

wished they were better prepared for the economic tumult we’ve all been through. One of the keys to future success is the ability of a leadership team to “autopsy” failures without blame and then identify how to avoid future pitfalls. I must credit Jim Collins, author of Good to Great and more recently, Why Good Companies Fail, with the empirical data that proves this conclusion. As a success driven CEO with a positive attitude in your DNA, autopsying failure may seem to go against your grain, but the practice is needed in a healthy company.

So make your list of what didn’t work and then at least 3 actions you could take to be sure you never get caught in the same situation again. For instance, one of the most common “lessons learned” I hear from the recession was we got caught in a cash pinch. Our supplier lines weren’t high enough, our bank lines got stretched, and when volumes dipped, it wasn’t much fun. So the autopsy exercise asks the question, what can we do going forward so that won’t happen again? A few possibilities are: manage our balance sheet differently now that we know what can happen. Most CEOs I know are setting much more aggressive cash targets and lower debt/leverage ratios going forward. The recession lesson was it pays to have cash.

Scope out the Competition. This past year was one of tumultuous change. It changed the competitive landscape. This is the perfect time to list your top competitors by sector and assess their strengths and weaknesses in comparison to your products and service. Are they faster or slower? Better quality or poorer? How do they price? How is their financial strength compared with yours? Remember that old quote of get close with your friends and even closer with your enemies? Nothing could be more true!

Often when doing on-site strategic work with companies, I find leadership teams who know the most about their direct competitors are the ones winning in the market, even if the competitor is big and tough. The knowledge

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allows even the smaller players to capitalize on niches and service levels the large competitors can’t match. The smart companies not only know the differences, but market those differences.

Clearly Identify your Current Strengths. As you review your successes, your lessons learned, and the competitive landscape, just the time spent on those sections will help bring clarity to your company’s clear strengths. What are you doing well that could be leveraged? For instance, I talked with one CEO who realized they had great customers, strong relationships with the customers and a fabulous distribution system that beat the pants off of most of their competitors. That’s a good thing to know as we’ll discuss in the next section. Leveraging strengths is exactly how the most successful companies in history achieved profitable, sustainable growth.

To take this portion of the strategic work to an even higher level, consider going beyond your leadership team planning session with a customer survey. This can be as easy as each member of the executive team taking an “A” customer out to lunch and simply asking the question of them – what do we do well that is key for you? And don’t be surprised if some customers focus on relationships (we love your dispatcher – always there when we need him, takes good care of us, etc.) while others focus on speed of delivery or quality issues. The main thing is ask and listen!

Prioritize and Plan. With the hard work you’ve done of identifying your successes, blamelessly looking at failures, being brutally honest about the competition and your own strengths, you’re now ready for the prioritization and plan. There are many ways to tackle prioritization, but the main thing is your whole team must be in agreement and unified about the plan – the items and the priority order. And, each piece of the plan must be specific and measurable. In fact the SMART goal acronym is a great test to be sure that each step of your game plan is: Specific Measurable Attainable Realistic Timely

As you develop the steps and plan, including measures, accountabilities and timelines, also try to identify potential roadblocks or hurdles. Let’s face it – everyone starts out the year with great plans, but life happens. If we can think through the possible roadblocks, we’ll be more prepared when they come. And they will come!

And now, back to my story of the marketer who analyzed strengths and made a great move. Realizing they had loyal customers and great delivery efficiency, they decided to expand their products beyond the typical petro offerings. The result? Huge increase in profits! How did they do it? By asking key customers what else they bought, compiling lists, and figuring out what they could do well and be profitable.

Personally, I think the next twelve months is going to be really exciting. While there will still be the aftershocks rumbling through the economy, we’ve already made it through the big one. Now is the time to look to the future and build the company you want. That’s what I’ve been helping companies do for the past few years in my Hidden Profits Coaching. It’s been really exciting to see companies come to grips with their strengths, their lessons learned, their changing marketplace and competitors. If you’d like to explore the profit and cash you might be missing, I’d love to hear from you.

In the meantime, how about taking action by going to your calendar right now and scheduling the day for your leadership team planning meeting? Action equals success!

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Arleen Alexander elected to ACAE Board of Directors

P&CMA President Arleen Alexander, CAE, was recently elected to serve as Secretary/Treasurer of the Alabama Council of Association Executives (ACAE), the state association for associations. Shown here with other newly-elected ACAE board members.


Commercial Drivers License Award Ceremony

Arleen Alexander, CAE, of the Petroleum & Convenience Marketers of Alabama, Officer Ruby Chappell of the Dept of Public Safety, Gene Vonderau of the Alabama Trucking Association and Major Charles Andrews Dept. of Public Safety. Andrews heads the Drivers License Division of DPS.

Ms. Chappell is the winner of the 2009 Commercial Drivers License Examiner of the Year Award. The awards luncheon was

held in October and was sponsored by the Alabama Trucking Association and the Petroleum & Convenience Marketers of Alabama.


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Phone: 256-878-3271Toll Free: 800-648-6584Fax: [email protected]

8600 US Highway 431P.O. Box 1576Albertville, AL 35950

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EPA’s E-15 Waiver Delay – Sensible Yet Mystifying

Mark S. Morgan, PMAA Regulatory Counsel

Regulatory Corner

he U.S. EPA’s recent announcement delaying a decision on whether to allow E-15 gasoline blends for use in conventional-fueled vehicles until next summer

is sensible but at the same time mystifying for petroleum marketers. First, some background. Last April, a group of ethanol producers asked the EPA to waive a provision in the Clean Air Act that limits ethanol blends used in conventional fueled vehicles to a maximum 10% content. Ethanol producers are concerned that without a waiver to clear the way for an E-15 blend, petroleum refiners will be unable to meet annual renewable fuel blending mandates required by Congress. Of course, petroleum marketers have important concerns of their own about E-15, but for different reasons. Marketers are concerned that allowing E-15 for use in conventional fueled vehicles will create a significant risk of liability for damaged auto emission control systems and failure of petroleum storage and dispensing equipment. There is also concern that introducing E-15 into USTS, piping and dispensers will void equipment warranties, insurance coverage and violate local fire marshal requirements. For its part, the EPA is concerned that E-15 could damage auto emission systems in conventional fueled vehicles resulting in an increase in tailpipe emissions. Finally, there is an array of additional E-15 concerns ranging from its effects on lawn care equipment to marine fuel tank and engines.

Giving these concerns, it makes sense to the casual observer that the EPA should take the additional time to make a well reasoned decision on E-15 that is supported by sound research. After all, there are so many unknowns with regard to E-15, so little information available or studies completed on the effects of mid level ethanol blends on conventional fueled vehicles, underground storage tanks, marine equipment and even lawnmowers that it would be irresponsible to rush the decision making process.

The delay makes sense, but what the EPA intends to do, or more accurately, not do with its extra time, is what is so mystifying to many petroleum marketers. The EPA said the delay is necessary to finish a test program that is currently in the works to determine the effects of ethanol blends between E-10 and E-20 on automobile emission systems. What is so mystifying is that the EPA’s efforts are solely focused on automobile emission systems. Despite the many issues raised by stakeholders affected by a possible E-15 waiver, the agency will not be studying or collecting information on E-15 effects on UST corrosion rates, degradation of plastic piping or rubber gaskets and seals in fuel dispensers. The EPA will not consider the burden placed on petroleum marketers from voided equipment warranties, cancelled insurance policies or increased

liability that is likely to result from the introduction of E-15, in its decision- making process. Nor will there be consideration of equipment replacement costs faced by petroleum marketers if the waiver is approved. The agency is aware of these issues. PMAA has raised them numerous times in different venues – directly with the EPA itself, through the Small Business Administration, at meetings and communications with the EPA Office of Underground Storage Tanks, with the EPA Small Business Ombudsman and with various stakeholder groups.

It seems incomprehensible to most that the EPA could make a decision as important as an E-15 waiver with a total bureaucratic vacuum. Outrageous as this may be, it is nevertheless true. There are a couple of reasons why the EPA can get away with brushing marketer concerns aside. First, under the Clean Air Act, the EPA is only required to consider the effects of a waiver of the E-10 maximum blend requirement on air quality standards. Underground tanks, equipment liability insurance coverage and warranty revocation do not qualify for consideration under these criteria. This doesn’t mean the agency is barred from considering factors other than air quality. It simply means it doesn’t have to. And that brings us to the real reason why marketer issues are seemingly off the table with respect to an E-15 waiver.

The EPA does not want to consider the wider implications of the E-15 waiver because it is politically untenable to do so. The agency risks not only the anger of the powerful farm lobby and its friends in Congress if it denies the waiver, but also jeopardizes derailing the entire renewable fuel standard by falling short of the statutory mandate to use 36 billion gallons of renewable fuels in gasoline and diesel fuel by 2022. Evidently, the EPA reasons it can take the heat from the myriad of interests brushed aside in the decision-making process by reminding stakeholders that a waiver would not mandate E-15, but simply allows its use. In other words, nobody is being forced by the EPA to use E-15. In other words, the EPA is telling marketers if you are concerned about putting E-15 in your UST systems, don’t use it.

This argument, however true, conveniently dispenses with the broader concerns with regard to E-15, which may be too hot for the agency to handle. Unfortunately, the EPA’s response simply begs the question – will marketers really have the luxury of making a choice between E-10 and E-15?

T


Rahim Budhwani founded 6040, LLC shortly after coming to the United States. Formerly a computer programmer, he bought his first convenience store in 2001. He began the business with just one convenience store and in 10 busy years, has acquired 6 more stores. Rahim also owns a business that sells, installs and services digital surveillance systems and ATMs.

Rahim’s wife, Kulsum, is the CFO of the company. They have two children: Alisha (9) and Zaid (2). Rahim first learned of P&CMA after working on a NACS project with P&CMA president, Arleen Alexander. Rahim is currently serving on the NACS advisory board and has been involved in a number of national committees for several years. He joined P&CMA three years ago and became actively involved. Rahim is also involved in the Alabama Merchants Association and believes that the associations can work together on issues that affect the industry. Currently, he is involved with helping NACS fight the credit card fee issue. He believes associations can work together and be much more effective.

Rahim believes that being involved in P&CMA has helped him in his business. He says, “The association offers insight that single store operators would not otherwise be privy to.” He believes it is all about working together, and Rahim looks forward to serving on the P&CMA board of directors and helping the industry leaders work together.

You might say petroleum runs in Phil Baggett’s veins. A third generation owner, Phil grew up painting gas stations. His grandfather, J.C. Butler, founded the company as a distributor in 1941. Phil’s father, Frank took over the business in 1967. After earning an accounting degree at the University of North Alabama in 1983, Phil helped his father expand the business into retail operations. Phil has run the company since his father’s death in 1996. Today, Baggett Oil owns and operates 15 gas stations and supplies approximately 25 dealer locations in Alabama and Tennessee.

Phil married Becky, his high school sweetheart, in 1983. They have four children: Alison (23), Rachel (21), John (18) and James (11). Alison married Claudio Pita last year & lives in Cambridge, MA. while the other children are still in school. Phil would like to say his hobby is golf, but between work, family, church and the kids’, activities, he doesn’t find much time to play golf.

Phil has been a P&CMA member since the late 1980’s. He believes the association helps its members by “being an advocate for our industry and helping members stay informed about issues in our state that affect us.” Phil looks forward to serving on the board of directors and hopes to help the association continue to represent the interests of the members.

Phil BaggettBaggett Oil CompanyFlorence, AL

Rahim Budhwani6040, LLCHoover, AL

Meet Your New Board Members


Providing environmentProviding environmental services that exceed our cliental services that exceed our clients’s’ expectexpectations.ations.

PPMCONSULTANTS

Environmental Science and Engineering

TTA N KA N K CC L O S U R E SL O S U R E S

CC ONTONTAMINAAMINATIONTION AA SSESSMENTSSSESSMENTS

PP R O P E R T YR O P E R T Y TT R A N S F E RR A N S F E R

AA S S E S S M E N T SS S E S S M E N T S

SS O I LO I L A N DA N D GG R O U N D WR O U N D W AA T E RT E R

RR E M E D I AE M E D I A T I O NT I O N

SS P I L LP I L L PP R E V E N T I O NR E V E N T I O N CC O N T R O LO N T R O L &&

CC O U N T E R M E A S U R EO U N T E R M E A S U R E PP L A N SL A N S

www.ppmco.com

PPM Birmingham, PPM Birmingham, ALAL5555 Bankhead Highway5555 Bankhead HighwayBirmingham,Birmingham, ALAL 3521035210205-836-5650205-836-5650800-761-8674800-761-8674

PPM Mobile, PPM Mobile, ALAL30704 Sergeant E.I. Boot30704 Sergeant E.I. Boots Thomas Drives Thomas DriveSSppanish Fort, anish Fort, ALAL 3652736527251-990-9000251-990-9000800-761-8673800-761-8673

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Kris Pierce first became aware of P&CMA when he was still in high school. He was dating Stephanie Norris, whose father, Robert Norris, invited Kris to attend his first P&CMA event with the family. Robert Norris started the first Jet-Pep in Holly Pond nearly 30 years ago; today there are more than 100 independent retail units across Alabama. Kris’ career at Jet-Pep really began while he was earning his degree at Auburn. He spent summers working on the Jet-Pep construction crew and joined Jet-Pep’s construction crew full-time after graduation in 1999.

After Kris moved into construction management, he soon saw the need to pursue further education and earned his Masters in Science & Engineering at the University of Alabama in Huntsville. Recently, Kris also earned a Professional Engineer (PE) license, which helps him as he is working with local building authorities.

Kris says, “P&CMA events are an awesome place to meet people.” He believes “involvement in P&CMA creates a more favorable business environment – which in turn creates more success for our sales.” The next generation is also getting involved with P&CMA; Kris and Stephanie’s children Emma (9), Kenan (6) and Sadie (2) enjoy attending the summer meetings.

As a new member of the board of directors, Kris hopes to be more involved in Department of Agriculture issues. He plans to be actively involved with Alabama tax audit procedures to protect members from unknown municipal tax. He also will continue to be active with upcoming state elections and the issues that affect the industry.

Kris PierceJet-Pep, Inc.Holly Pond, AL

Meet Your New Board Members

Make o r!

y uheciov drae

Oil Prophets reaches YOUR market! Terri Mendez | [email protected] 334-657-6575 877-363-0832 toll free

Creative Marketing ConceptsKeeping you in touch…it’s what we do!

Advertise with us!Oil Prophets and The P&CMA Annual Membership Directory & Buyers’ Guide are the only regional publications designed exclusively for the petroleum and convenience store industries in Alabama.

© 2010 Alabama Power Company

COOKS THE FOOD NOT THE COOK.

When you cook with electricity, your kitchen stays cooler, keeping your staff more comfortable. And a more comfortable staff means a more productive staff. Plus, with electric cooking, you get faster preheat and recovery times. Not only that, cleaning an electric oven is easier and quicker. So switch to electric today. Your business will be cooking like never before.

For more information about the advantages of electric cooking, call 1-888-430-5787.

POWC-2082 Cooking.indd 1 1/18/10 9:19 AM



2010 ANNUAL SPONSORSPLATINUM Federated Insurance Company

GOLD C D G Engineers & Associates, Inc.

SILVER Mooty & Associates, P.C. PPM Consultants, Inc.

BRONZE MECO, Inc. Gallet, a Terracon Company QORE Property Sciences

P&CMA’s Annual Sponsor Program provides four levels of sponsorship opportunities for all associate and affiliate members – each level offering various benefits conducive to your company’s needs. Call the association office at 334/272-3800 or visit our website at www.pcmala.org if you would like information about becoming a P&CMA Annual Sponsor in 2010.

PETROLEUM & CONVENIENCEMARKETERS OF ALABAMA

THANKS OUR

23


P&CMA’s sponsor program is designed to provide participating companies with high-level networking opportunities and mazimum exposure to our membership at P&CMA-sponsored events. The program provides four levels of opportunity: Platinum, Gold, Silver, and Bronze; each level offering benefits conducive to your companies needs.

Please feel free to contact Lauren Hodge at the association office at (334) 272-3800 to further discuss any questions you may have or to discuss which level of participation is best suited for you.

2010 P&CMA SPONSOR PROGRAM

Platinum Sponsor $20,000 Gold Sponsor $10,000

Silver Sponsor $5,000 Bronze Sponsor $2,500

Name:

Company Name:

Please Invoice: One Time Monthly Quarterly

Check Enclosed

Credit Card One Time Monthly Quarterly MasterCard Visa American Express

Card Number:

Signature:

Mail or Fax this form to:P&CMA

P.O. Box 231659Montgomery, AL 36123-1659

Ph: 334-272-3800Fax: 334-272-3837

Petroleum Convenience Marketers of Alabama&


Petroleum Convenience Marketers of Alabama&

P&CMA PACContribution FormI’m serious about my petroleum marketing and convenience store business!!

Count me in! I will help my industry speak with one powerful voice and protect my ability to earn a living in the petroleum marketing and convenience store industry in Alabama! I want to contribute the following amount to the P&CMA PAC:

$140 Club (One dollar for each member of the State Legislature)

$201 (For the 2010 Elections)

$500

$1,000

Other $

Method of Payment:

Check (Personal or Corporate) (Please make check payable to P&CMA PAC)

Credit Card:

MasterCard Visa American Express

Account Number: Expires:

Name:

Company:

Address:

City/State/Zip:

Phone:

State PAC contributions are for political purposes and are not tax-deductible.State law allows for personal or corporate funds to be used.

RETURN FORM TO P&CMA PAC P.O Box 231659

Montgomery, AL 36123-1659(334) 272-3800 (334) 272-3837 Fax


. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Risk Management Strategies For Business Owners

This publication is intended to provide general recommendations regarding risk prevention. It is not intended to include all steps or processes necessary to adequately protect you, your business, or your customers. You should always consult your personal attorney and insurance professional for advice unique to you and your business. © Copyright 2009 Federated Mutual Insurance Company. All rights reserved. The FEDERATED Insurance Companies ● Home Office: Owatonna, Minnesota 55060 ● Phone: (800) 533-0472 ● www.federatedinsurance.com

Driving

It’s Our Business to Protect Yours® .. …..

Steer Clear of Winter Driving Risks Across most of our country, winter brings with it snow, sleet, fog, and ice. These weather conditions often result in hazardous roadways, poor visibility, and stressed-out drivers—not a safe combination.

To help navigate safely through winter’s challenges, make sure both you and your vehicle are prepared.

Ensure your vehicle is in optimal winter condition, including:

Battery fully charged

Fluids topped off

Tires have adequate tread for winter driving

Wiper blades and defrosters working properly

Stock your vehicle with proper supplies for winter-related situations:

Abrasive material (kitty litter, sand, salt, or traction mats)

Cell phone and battery-operated radio

First-aid supplies

Jumper cables, flashlight, and warning devices (reflective triangle or flares)

Snow shovel, broom, and ice scraper

Tire and tow chains

Warm clothing, boots, blankets, or sleeping bags

Water and high-energy food

Best Advice: Avoid driving during adverse conditions. However, if driving is necessary, follow these tips for a safer journey:

Adjust your speed

Avoid using cruise control

Clear windshields and mirrors of ice and snow

Increase your following distance

Pass with extreme caution

Start and stop smoothly

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .



Driving






Fluids topped off






First-aid supplies



Tire and tow chains




Adjust your speed






Wear your seat belts

Give ample space to snow removal equipment

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .



Driving






Fluids topped off






First-aid supplies



Tire and tow chains




Adjust your speed






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New P&CMA Members

27

1 (800) 685-NUTS4713 North Hale Ave.

Tampa, FL 33614(813) 872-0900 Fax: (813) 872-7358

E-mail: [email protected]

421920_HawksPeanut.indd 1 3/3/09 10:32:20 PM

New Active Members4th Avenue, LLC1101 4th Avenue NorthBirmingham, AL 35203-1535Ph: 205/243-5555

Lewis & Raulerson, Inc.1759 State StreetWaycross, GA 31501-6714Ph: 912/283-5951

U S A Gasoline648-B Boll Weevil CircleEnterprise, AL 36330Ph: 334/347-6587

New Associate MembersBeall Corporation415 Church Street, #1215Nashville, TN 37219Ph: 423/304-2155Manufacturer of Petroleum Semi-Trailers and Pumper Trucks

Carr, Riggs & Ingram, LLP7550 Halcyon Summit DriveMontgomery, AL 36117-7008Ph: 334/271-6678Certified Public Assountants

Dupre’ Logistics, LLC201 Energy Parkway, Suite 500Lafayette, LA 70508-3851Ph: 800/356-3659 Petroleum Products Transportation

Littlejohn Tank & Equipment1720 Union StreetP.O. Box 5177Spartanburg, SC 29304-5177Ph: 864/573-9314New Polar Petroleum Tankers and Used Tankers

R B S World Pay4410 Glenwood LaneAnna, TX 75409-7686Ph: 972/924-2350Credit Card Processing

Ryko Manufacturing Company1500 S. E. 37th StreetGrimes, IA 50111-4951Ph: 515/986-3700Car Wash Manufacturer

T N T DistributionP. O. Box 20126Montgomery, AL 36120-0126Ph: 334/531-4100Souvenir Keepsakes: Key Rings, Magnets, Coffee Mugs, T-Shirts


Alabama Tank 5

Alabama Power 21

AlaCOMP Inside Front(Business Insurance Group)

C&S Canopy 11

Federated Insurance Inside Back

Hawks Nuts, Inc 27

Littlejohn Inc. 14

Meridian Associates 13

Nationwide 16(Randy Jones Insurance)

Pesco, Inc Back Cover

PM Environmental 28

PPM Consultants 19

PURE Oil Jobbers 7

Werts Welding 15

Index of Advertisers

Please Support OurAdvertisers!

To advertise in Oil ProphetsCall: 877.363.0832

Calendar2010

28

P&CMA IMPORTANT DATES March 2-4 and 9-11, 2010 Driver Safety Meetings Locations around the state

July 8-11, 2010 P&CMA Annual Convention Sandestin Golf and Beach Resort Destin, FL

September 20, 2010 Fall Golf Classic Wynlakes Golf & Country Club Montgomery, AL

December 8-9, 2010 General Membership Meeting The Wynfrey Hotel Birmingham, AL

OTHER IMPORTANT DATESMay 12-14, 2010 PMAA Washington Conference and Day on the Hill The Washington Court Hotel Washington, DC

October 4-5, 2010 PMAA Fall Meeting Atlanta, GA

October 5-8, 2010 NACS Show Atlanta, GA

Are your insurance premiums too

The key to cutting insurance costs is…Controlling Losses

Key Agenda Items: Your Losses versus the Petroleum Industry How an Underwriter Views Your Business Industry Input Session Petroleum Marketers’ Loss Keys

· Employee Training· MVRs /Drivers’ Standards· Tanker Rollovers· Hiring Practices· Distracted Driving· Employment Related Practices Liability· Business Planning· Disaster Planning Customer Slips, Trips, and Falls Workers Compensation Claims Management

High

Upcoming Classes for Petroleum/C-Store Marketers

Designated Risk Managers Training Program

March 22-24, 2010 September 13-15, 2010

AD-261.3 ad Ed. 10/09 Copyright 2009 • Federated Mutual Insurance Company

To send your risk manager to our informative Designated

Risk Managers Training Program, contact your

local Federated Marketing Representative or

Jina Duchnowski at Federated 1-800-533-0472, ext. 5604.

“The session on employee driving and checking motor vehicle reports was the most beneficial. It explained the importance to the business to check MVRs and hire only good drivers.”

“The amount of risk management knowledge shared is almost overwhelming. I was most impressed by Federated’s commitment to help us minimize risk.”

“I would recommend this program to anyone in the petroleum business. It’s made me take a step back and realize that the ideas discussed could be put in place for minimal cost.”

“This time was very well spent. Our business is doing many things right and now will do even more things correctly.”

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