Industry survey: Propane retailers boost operational efficiency

Gray, Gray & Gray released the results of its annual propane industry survey.

The survey serves as a benchmark for propane and fuel oil marketers throughout the U.S. Results are based on reported operational and financial data for the heating season spanning from April 2023 through March 2024.

This year’s survey features additional operational insights from Angus Energy, a data analytics firm.

“While propane companies are not immune to the economic challenges facing the broader business world, most seem to be successfully managing through the turbulence,” says Marty Kirshner, the partner who leads Gray, Gray & Gray’s Energy Practice Group. “The keyword this year seems to be ‘efficiency,’ with an increasing number of dealers focusing on improving their operational performance in order to remain competitive.”

Results of Gray, Gray & Gray’s propane industry survey suggest propane retailers are focusing on operational efficiency to remain competitive. (Photo by LP Gas staff)

Highlights from this year’s survey:

• Technology is gaining importance for a company to remain competitive: 61 percent of survey respondents report they “need to keep up with the best practices in the industry” when it comes to adopting new technologies, while 29 percent say technology will “impact my decision-making only when I see the results.”
• Propane marketers remain confident in the industry and their future: 82 percent of dealers report they are either “highly confident” (39 percent) or “confident” (43 percent) in their ability to remain a viable business, while 40 percent say they are in the market to make an acquisition in 2024.
• Vehicle purchases point to optimism: 54 percent of dealers plan to add at least one to three new vehicles to their fleet in 2024. Another 8 percent plan to grow by four to five new vehicles, 4 percent by six to 10 new vehicles and 8 percent by 11 or more new vehicles.
• Nobody is standing still: Dealers are working hard to increase their per-gallon profit margins (88 percent) by adding new services (22 percent), improving efficiency by making fewer but larger deliveries (68 percent) and optimizing fleet operations through better delivery planning (69 percent).
• More dealers report planning for the future: 36 percent say they have a strategic business plan in place for the next two to five years, up 4 percent over 2023; and 56 percent have a business succession plan in place, up 5 percent from last year.

Complete results of Gray, Gray & Gray’s 2024 propane industry survey are available at gggllp.com or by calling 781-407-0300.

Top 5 operational changes

What is the most impactful business operations change you made in the last 12 months?

1. Upgrading and adding new technology and/or back-office software
2. Expanded service capabilities
3. Cross-training and/or adding new staff
4. Business acquisition and expansion to new locations
5. Adding or expanding tank monitor usage

For coverage of prior survey results, read:

• Propane industry survey shows wage growth
• Gray, Gray & Gray releases 2022 propane industry survey results
• Industry survey: Daunting year in propane forges renewed vision
• Survey charts propane industry’s response to challenges new and old
• Nationwide survey captures industry in transition