Asset Light Model
On the River and Houston area, there is adequate availability of tankage. So, in similar fashion to SSOE, AmeriBlend Inc. will follow an “Asset Light Model” and not invest in large capital assets.
Making Our Presence In New Orleans and Houston
Since the storage and blending facility will be located in the vicinity of New Orleans, Louisiana, our Board of Directors decided to open an office in Kenner, Louisiana, a nearby suburb of New Orleans, from where we will run our business and operations. We already possess the required qualifications to conduct business in the State of Louisiana.
Focusing On All Customer Segments
By virtue of our relentless focus on all customer segments, we plan to drive our revenues from domestic and export sales. In usual practice to keep the product moving for working capital rotation, domestic sales will be made to utility companies and other traders in the market. The export sales will be in the bunker market, including ocean going vessels and fuel oil buyers. We will also have the option to sell our product to SSOE on an arm’s length basis, which in turn will place the product as a blend-stock for blending at their facilities in the Middle East. This is part of a strategy of backwards integration to supply our own companies. The payment terms of the sales would be fully secured either through pre-payment or through Letters of Credit (LCs).