“Prime in the volatile market”

Interview with Irene Notias

In her interview with maritimes.gr, she talks about “Prime Petroleum Services” and the company’s comparative advantage at these turbulent times; as well as how it is affected by and how she manages, the reduced liquidity in the market and zero credit on the part of the banks.

1)A few years ago, you gave up previous related posts in big companies dealing in maritime fuel in order to become an independent agent. How did you come to that decision? Wasn’t it difficult to start a business in such volatile times?

After 16 years working in the high pressure & demanding bunker purchasing sector on top of 14 years work in New York based commercial industries & Shipping, it was time to move on.

Following my departure from the position of Sales & Marketing Manager in a large worldwide bunker trading company in the Autumn of 2008 in order to take a 6 month hiatus (and before getting use to not working), the freight market collapsed and suddenly many clients contacted me on my cell asking where I was and to take the inquiry and handle it for them. Even though, I was not working, I couldn’t say no. Couldn’t stop that “service” button, I guess. The rest is history.

And so, Prime was born out of demand.

There had been a slight dilemma. I already had my own bunker broker business in 2002 and another business in NYC so I wasn’t sure if I really wanted to start up again, especially in Greece where there is such bureaucracy. Plus, I had been used to working under a manager and part of a team with no holistic responsibilities. But one thing led to another, as stated before, the customer’s requests led me to make what I was doing for them official and legal in Athens by opening up an office.

Today I can assure you that, although I like to jokingly say that circumstances chose me, I have thoroughly enjoyed having my own business. In the last two years, I have realized that I actually love creating a business, managing its challenges & development, and knowing a thriving entity that is able to offer a chance to young people to apply themselves and excel. When I think of that, it brings me joy.

I’m very lucky to be able to apply business ethics & values that I have been taught in New York to my own business & to teach it to Prime’s team which by the way deserves mention because they really have excelled within these last two years . Since my early working years in sales in New York City, my business philosophy has always been: “customer comes first”.

2)Which specific services does your office provide?

Our office provides information services that assist bunker buyers to achieve the “best buy” possible of that day! We also have bunker purchasing outsourcing facility for several shipping companies including Dianik Bross Shipping and Grace Trading Corp.

Having established long and trustworthy relationships with the majority of our clients, we are able to work proactively for their requirements & act on the bunker buyers behalf as their own purchasing agent. Our wide network is searched diligently by our purchasing & customer service team for the best price/ quality available. We never use only one source – in fact we use over 3 sources all the time, so we perform as if we are buying the fuel for our own fleet, the way buyers do in large shipping companies.

3)To whom do you offer your services?

Our office offers services to shipping companies that are owners, managers, charterers and even suppliers who entrust us to cover the market for their fleet.

4)Which, would you say is your comparative advantage?

Our strongest advantage is our continuous personalized service – we go that “extra mile” so to say. The buyer’s needs guides us and we always provide written clear, transparent & competitive bunker price offers. Most importantly to our consistent 30 day paying clients, we try to avoid third party risk by stemming on their behalf directly with the supplier, where ever it is accepted & feasible.

5)The market is facing liquidity problems at the moment. How much does this affect your sector?

The problem of cash flow is incredibly and inevitably affecting the payment of bunker invoices. For the first time this year, we are seeing a small percentage of respectable clients facing difficulties in honoring their commitments; however, the market understands this and is cooperative as much as possible. The positive thing is that more than 95\% of our clients have the cash flow to make their payments on time. The negative thing is that most suppliers have cut back from offering direct credit to the end user, due to their knowledge of the liquidity issue & they don’t appreciate that some clients expect them to act as lenders. They prefer to sell to a strong trader that they know has the funds to pay the obligation over a direct user whom they only see one inquiry once a year, for example.

6)Where do you generally focus the problem on?

Again, the problem, or I should say, obstacle we are facing regards our client’s credit lines. Even when a client has had a good payment track record in the past, inability to make duly payments affects the clients company credibility profile, thus, the client will end up paying the cost of fuel a little higher cause the supplier will not offer credit directly. It’s sort of a vicious cycle. Buyers with no payment history have little chance of achieving a credit line direct with a physical supplier now days due to the liquidity factor and are subject to the margins of the sellers or traders. Positive note, many traders are sensitive to this and do not add much on top as they could or would normally under better financial times.

7)Fuel is certainly important but also the most costly expense. What is your pricing policy?

We do not invoice our clients, so we don’t have a pricing policy on the fuel. As brokers we act as intermediary agents thus forward the sellers invoice to them. Furthermore, any fluctuations in fuel price never affect our income. We receive a standard commission based on quantity.

Our business, however, gains when we are able to save money for our client. After all, the foundation of our service is reducing costs for our client by knowing when to buy and from whom, along with knowing in advance all the variables involved in supplier’s or trader’s pricing.

8)How directly is your market affected by the stricter regulations regarding the reduction of carbon dioxide emissions?

It is affected a lot. Stricter regulations demanding low sulphur fuel raise the already unbearable cost of fuel to even higher levels price wise & in that suppliers require minimums in order for quality blending and sometimes buyers don’t need that much; thus making fuel payments even more difficult at a time when the Shipping market is experiencing the worldwide economic crisis. Also, low sulphur has not been readily available because of high production costs and we have had to further investigate to locate such product. We have seen a slight improvement though as there is an increased production of these products world-wide.