Over the past several years, I have heard the statement made from many of my friends and business associates: ‘I can buy it online.” When I ask why, I’m generally told that the item is cheaper, no tax and next day shipping is free. I guess these are some very good reasons for the high volume of sales being made around the world.
One of the most popular names I hear most often is Amazon, founded in 1995 by Jeff Benzos. It survived the .com crash and has become a dominant retail outlet. Even during the 09 recession, Amazon sales in the United States grew to about11%. A few months back many of you, like me, may have watched the news show 20/20 when the owner of Amazon gave the details of his company’s inventory processing and shipping procedures that provides for one day arrival of many of the items. He also explained why he buys large tracks of land all over the United States, just so that he can establish more points of distribution. In the last segment of the program the owner unveiled a drone that could sometime in the future to be used to deliver products that weigh less than 25 lbs. direct to your door. [Editor: That might have been more of a publicity gimmick than a real part of its strategic plan, but it worked at that level and it showed insight into the company’s value proposition.]
Another facet of online buying is illustrated in a report done in 2010 that states more than two-thirds of the U.S. population made an online purchase last year. Just an added FYI, one of the first online purchases was in 1994 for a Pizza Hut pizza.
You may by now be wondering where I’m going with this, and what does it have to do with the oil/ propane or HVAC trades? Well, on a regular basis I’m told by many contractors that their customers are telling them that they can buy one of their products online for much less money. In fact, a heating contractor recently told me that his customer bought a high efficiency wall hung boiler on line for $200 less and called him to install the unit. Would you or would you not install this unit? You may want to ask the customer who takes care of a possible warranty issue or provides the technical support that is often required? I know there are several companies setting up online oil selling models, and I’m told they are in fact doing well. In my area if you want to check the price of oil, go to www.NewEnglandoil.com. Once there, an order can be placed.
One of my main concerns regarding selling heating items on-line is safety, such as proper venting and wiring. I recently heard a family of three that died from carbon monoxide poisoning. The cause was determined to be a faulty installation from a unit, which according to sources was purchased online. These same units could be installed incorrectly by either a homeowner, or another untrained and unlicensed individual. A lot of the items sold online are often discontinued items sold off to a third party to eliminate the cost of inventory. Do you ever wonder if online selling will reduce the licensed and trained work force? Not in my life time!
Charlie Bursey began his long career in the oil heating industry in 1963. He has delivered coal, kerosene and oil and serviced heating and cooling equipment. He has also managed service departments, worked for a manufacturer and currently works with F.W. Webb, Warwick, R.I. He is a recipient of the Association of Oil & Energy Service Professionals’ prestigious Hugh McKee Award for making an outstanding contribution to the fuel oil industry; having had an understanding and cooperation with his/her
fellowman; and having unselfishly aided the industry in education and related activities.