Technology to the Rescue

 

Technology is coming to the aid of service departments. By collecting and transmitting data, then presenting the information in meaningful form, the systems of a number of technology providers can help prevent runouts and burner lockouts. But that’s not all. They can be used as an enticement in promoting service contracts, for example, and in a number of other creative ways.

 

Here is a look at some of the systems on the market, and the benefits they can provide to fuel oil dealers seeking to boost the efficiency of their service departments. 

 

 

ADD Systems

  

Energy prices and service costs are two factors that have focused dealers on more efficient management of their service departments. Although the price of fuel oil has leveled off, many dealers want to be prepared in the event it spikes again.

 

‘One of the ways they can do that is by at automating their service departments,” said John Redmond, vice president of strategic product development for ADD Systems.

 

ADD Systems back-office system, ADD Energy E3, and the company’s Pegasus software product, combined with an automated inventory management program, are designed to work together to enhance overall productivity, including in service departments, Redmond said.

 

For the service technician, ADD Systems adapted its Pegasus product to work on smart phones that can be bought for as little as $100. The low cost of the smart phone is a key part of the equation, according to Redmond, who said that though the smart phones that can carry the software have a list price of $300, customers usually end up paying about $100.

 

Oil dealers buy the smart phone directly from the phone company and ADD Systems ships a memory card with the software on it. When a no-heat call comes in, a customer service employee creates a work order in E3, the vendor’s back-office product; the work order automatically goes to the Pegasus dispatch program and is sent over a wireless connection to the smart phone that the technician has in the van. This eliminates the need for verbal communication between the dispatcher and the service technician.

 

A trend among fuel oil companies toward flat rate billing is also streamlining service work, Redmond noted. With flat rate billing, a service technician uses the Pegasus software installed on a smart phone to record the work that he did, and to print an invoice for the customer. (Receipts are printed on a small portable printer in the service van; the smart phone transmits the invoice to the printer via Bluetooth, a short-range wireless connection.)

 

Since work done one day is entered into the system the same day, there are inventory control benefits, Redmond pointed out: it will be known what parts were used that day, and ADD Systems’ electronic parts re-ordering system can replenish inventory on service vans.

 

Further, this can help to reduce in-house inventory, convert an operation to just-in-time inventory, and result in lowered inventory costs, Redmond said.

 

 

Enertrac Inc.

 

Enertrac is a volume monitoring system for dealers of heating oil, propane and other refined petroleum products. The monitoring devices are manufactured at low cost in China, and ‘our go-to-market strategy is to give them away for nothing,” said Richard Gibbs, a founder and the vice president of sales and marketing. The company, whose tag line is ‘data as a service,” charges for the monitoring on a subscription model like those for cell phone or cable service.

 

Dealers sign a five-year contract and pay a monthly fee, ranging from about $3 to about $6 per month, per tank, to receive data via a Web site. The monthly fee depends on the number of tanks fitted with the monitoring devices.

 

Installation of the monitoring device is relatively simple, Gibbs said. A service technician removes the extra bung from the tank and screws in the monitoring unit by hand. A wire from the bottom of the device extends to within a couple of inches of the floor of the tank. A weight is on the end of the wire.

 

A receiver installed in a customer’s household or in the neighborhood picks up data from the device on the tank and relays it to the Internet for presentation on a secure Web site where dealers can view it for up-to-the-minute volume readings.

 

Because the device measures tank volume within one to three percent of actual amounts, in real time, dealers should be able to make deliveries that average as much as 180 to 190 gallons, Gibbs estimated.

 

Although the Enertrac system is designed to improve dispatching, management of trucks and use of manpower, and to boost average delivery volume, it can help reduce runouts and burner lockouts as well, Gibbs noted.

 

With accurate tank volumes continuously available, Gibbs said, dealers can know within a few gallons how much is in a tank before a driver goes to a customer’s residence, and so can plan deliveries more efficiently.

 

The continuous nature of the monitoring in real-time also enables a dealer to see when a customer on an automatic delivery program ‘goes and buys 100 gallons on the cheap from somebody else,” Gibbs said. Receiving the data on the added fuel, the system would note the absence of a delivery ticket and generate an exception report.

 

In contrast, a dealer delivering on the basis of degree days wouldn’t know about such a purchase ‘and the K factor would change and you’d have a runout,” Gibbs said.

 

 

Oil Equipment Manufacturing

 

VisiTank, a remote tank level monitoring system, uses wireless sensors, which are simple to install, a virtue much appreciated by the service department technicians who typically do such installations, said Steve Whitman, vice president of sales for Oil Equipment Manufacturing, the maker of the system.

 

The system provides continuous monitoring of the fuel level in a tank, thus helping to avoid runouts, Whitman noted. The monitoring system is more dependable than the conventional method of relying on degree days, he said. ‘Usage can change, not only with degree days, but with different kinds of usage, and that has been particularly true with fuel being more expensive fuel, and some people going to mixed fuel use” ‘  alternating between fuel oil and pellet stoves, for instance, or between fuel oil and heat pumps. In addition, relying on degree days fails to allow for times when homeowners might be away for an extended period, Whitman said. ‘The point is, you cannot go just by degree days because that assumes a constant usage within the house for a given temperature outside,” Whitman said.

 

The VisiTank system features an ultrasonic sensor that fits into the top of a tank.

Employing a form of ultrasonic range finding, the device generates a pulse downward to the surface of the fuel; the pulse bounces back to the device, which measures the interval.

 

A radio transmitter in the unit (powered by a battery with a 10-year life) sends a signal to a modem installed in the residence, which relays the data via phone line to the oil dealer’s computer system. VisiTank’s software, installed on the dealer’s system, uses the sonic data, along with the pre-entered dimensions of the tank, to calculate the quantity of fuel that the empty space can contain.

 

The VisiTank system does have one wired sensor, to detect burner lockout. If the burner shuts off automatically for safety reasons, the sensor detects the closure of a contact and sends a signal to the modem, which in turn dials into the oil dealer’s server and creates an alarm, Whitman explained.

 

The hardware kit includes the ‘rocket” that contains the ultrasonic sensor and transmitter, the modem, and autonomous battery powered temperature sensors that can be placed anywhere in a residence. The temperature sensors can send an alert in the event a circulator pump malfunctions, Whitman noted. (The burner lockout unit is an option.) The software is installed on the dealer’s computer system.

 

Technology Assistance Group

 

Some fuel oil businesses have acquired a number of software programs over time, and when such programs are provided by different vendors they often do not work with each other. Bob Levins, founder of Technology Assistance Group (TAG), said his company’s software is designed to automatically collect data nightly from each program to create useful summaries or ‘put the story together.”

 

It beats the heck out of manually inputting data from all those programs into an Excel sheet, Levins said.

 

‘People have Excel spread sheets for one reason,” Levins said. ‘Because the systems they have do not create a report with the information organized the way they need to see it.”

 

Data, meaningfully presented, can tell dealers where they’re losing money and where they can make more money, Levins said. TAG’s software focuses on parts costs, labor costs, technician performance ‘ ‘and, I might add, customer performance,” Levins said. ‘The customer’s home heating plant quite often is the cause of all the problems. That’s where the greatest opportunity lies right now.”

 

If a dealer has 10,000 accounts and 2,000 are responsible for nearly half the service calls, Levins said, ‘they’re the reason you’re losing money ‘ or not making as much money as you possibly can.”

 

Fuel oil dealers can resolve problem accounts, Levins said, during the annual cleaning or preventive maintenance, by selling new equipment to the customer, and at contract renewal time.

 

The first shot comes with the preventive maintenance. Before a service technician goes to a problem account, he should be informed of the history. ‘Somebody tells the tech, ‘This account is one that’s killing us. We don’t care if it takes the time of two cleanings, we need you to spend the time there and fix this,” Levins said.

 

If the technician cannot fix the problem equipment, the next option is to refer the case to sales, ‘but you have to have a process for sales to follow up when the technician does that,” Levins emphasized. Some companies’ sales departments do a good job of handling referrals from technicians, talking to the customer and submitting a proposal, but drop the ball when it comes to getting the customer to sign the proposal, Levins said.

 

The last line of defense is the service contract renewal. ‘You’re looking at a guy who had 21 calls this year and saying, ‘Do I really want to renew this contract?'” Levins said. Approving that contract renewal can mean approving $2,500 to $3,000 of expenses in the new year, Levins said.