Propane Retailers Deal with Challenges to Boost Business

FREMONT, CA: Several economic factors are now affecting propane retailers daily due to recent global events. The to-do list for propane retailers has grown, and these are not small-ticket items either. In the past, propane retailers could focus on a few issues while steering their businesses forward. Atop that list of issues are inflation, labor strife, and supply chain breakdowns, all while keeping a keen eye on the other integral processes involved in delivering propane safely to end-user customers. Running a propane business during normal times can be challenging.

Propane industry retailers face additional challenges today due to shocks to the US economy and supply-and-demand imbalances.

Issues: According to AAA, gasoline prices increased to USD 5.02 in March, and diesel prices increased to USD 5.82 in June after Russia invaded Ukraine. As fuel prices increased this year, propane industry leaders were able to emphasize the cost benefits of autogas fueling fleet vehicles. Steel prices reached historical highs between late 2021 and early 2022 before retreating. The manufacturer of portable steel LPG cylinders announced a price increase of 10 percent in the spring due to rising raw material costs and challenges in the transportation and labor markets.

"Propane is poised for growth, with industry leaders focusing on attracting new customers, harnessing renewable energy, and finding solutions to the challenges facing businesses today."

Labor shortages: The major concern for the industry is finding employees to fill open positions. LP Gas has learned about some of the methods retailers use to address their workforce challenges, even though many propane industry leaders agree that attracting and retaining employees continues to be challenging. A survey conducted by LP Gas this year found that nearly 90 percent of propane retailers have increased their employee wages by 12 percent on average over the past two years. Approximately a quarter of respondents provide more paid time off, while slightly fewer offer increased health care or flexible hours. Apprenticeship programs have also gained traction. The National Propane Gas Association (NPGA) offers a program like this in collaboration with PERC and the Department of Labor.

In contrast, some employers offer apprenticeships for service technicians and commercial drivers. The PERC has also emphasized workforce development and has developed tools for businesses and communities. The council's outreach initiatives include webinars, school outreach kits, and the promotion of regional and state association job boards. Its scholarship and grant programs put propane at the forefront of technical schools and community colleges