Background

A western-based convenience store chain operating across the Rocky Mountain region began facing increasing challenges of sourcing fuel reliably. A tapped-out local fuel market led to frequent shortages and rising wholesale prices, putting pressure on both margins and customer access at the pump.

With fuel availability becoming less predictable and limited options to diversify supply without increasing transportation costs, the retailer needed a more reliable and cost-effective way to keep stores fueled while maintaining competitive pricing for consumers.

That’s when the company turned to KAG to help rethink its fuel supply strategy.

The Challenge

The retailer’s existing sourcing model relied heavily on a constrained regional market affected by refinery limitations and seasonal demand spikes. As supply tightened, fuel deliveries became inconsistent and wholesale costs increased by $0.15-$0.30 per gallon.

Without a new approach, the retailer faced continued volatility that threatened fuel availability, customer satisfaction, and long-term growth in the region.

The Solution

KAG Logistics recommended a transloading solution to supplement regional supply and reduce exposure to local market constraints. By repurposing a transloading facility in the Salt Lake City, UT region, KAG created a new import point that allowed fuel to move efficiently by rail for the long haul, then transfer to tanker trucks for regional and last-mile delivery.

This approach reduced reliance on local supply sources while improving transportation efficiency and cost control. KAG managed the logistics planning, facility coordination, transportation execution, and compliance oversight to ensure a smooth transition from planning to first delivery in four to six weeks.

As a result, the solution supports the movement of approximately 30 million gallons of gasoline and diesel annually, providing the retailer with a more flexible and scalable fuel supply model.

The Results

With the transloading solution in place, the retailer eliminated recurring fuel shortages and stabilized supply across its locations in the region. Transportation and sourcing efficiencies delivered double-digit cost savings on fuel movement, helping keep pricing more predictable for consumers.

Since implementation, the retailer’s business in this market has grown by 200% and plans are underway to replicate the transloading model in additional markets.

Results Overview

• Alleviated ongoing fuel supply constraints
• Ensured consistent access to fuel for consumers
• Helped stabilize fuel pricing in the region
• Created a scalable solution to manage shifting market conditions

Why Transloading Works

For fuel retailers operating in tight or volatile markets, transloading offers a flexible, cost-effective way to secure supply without long-term infrastructure investment. By combining rail efficiency with reliable truck delivery, transloading helps reduce risk, control transportation costs, and keep fuel moving where it matters most.

Next Steps

If your operation is experiencing fuel supply constraints, rising transportation costs, or market volatility, transloading may offer a smarter path forward. KAG works with fuel retailers and distributors to design transloading solutions tailored to real-world operating conditions.

Reach out to learn how a transloading strategy could support your network.