If there were such a thing as a fuel dealer dictionary, irony might be defined as a grossly inefficient delivery drop, one in which a tanker burns more gallons to reach a customer’s home than it actually delivers to the customer’s tank.
That’s an extreme example, to be sure, but the point stands: too far, too frequent deliveries with too small drop sizes represent some of the most common yet most easily avoidable inefficiencies plaguing fuel dealer margins today.
One simple way to eliminate this kind of waste would be by following the data: tracking the amount and cost of fuel a customer typically receives and how often they get deliveries, and comparing those numbers with the amount and cost of on-road gallons it takes a truck to fulfill those deliveries.
Though this solution might seem obvious, it’s also frequently overlooked, according to John Coyle, vice president of sales for energy software developer ADD Systems. “We know that delivery drop efficiency is one of the biggest opportunities for fuel dealers to gain profits, but all too often we see dealers neglect the opportunities here,” he says.
“By using their own data and making changes to forecasting methods, dealers can deliver the same number of gallons in fewer drops,” Coyle continues. “Not only does this make those customers immediately more profitable through a reduction of miles driven and time spent per gallon delivered, but this also frees up resources to take on more customers and increase total gallons delivered for the company.”
For the modern home comfort company, the customer portal and back-office software are data-rich environments containing all of the numbers and calculations mentioned above and more. Indeed, there are so many statistics and formulae to monitor that one might not know where to start, and it could be easy to become either overwhelmed by the sheer volume of data available, or over-focused on relatively minor details and anomalies – missing the forest for the trees, as the saying goes.
If each data point in a company’s computer systems is a tree, then the company’s overall operations are the forest. Of course, one of the main reasons most businesses deploy technology such as customer portals and back-office software is to improve operational efficiency. And yet, Coyle points out, “Using data to drive operational efficiency is one of the opportunities most overlooked by fuel dealers.”
Rather than miss the forest for the trees, keen software experts like Coyle and his associates at ADD Systems help home comfort providers focus their attention on both. That means mining data for information on everything from “miles driven per gallon” to “time spent per gallon,” without ever losing sight of the bigger picture – operations efficiency.
With this in mind, improving margins by optimizing delivery routes and drop sizes is an important and too often overlooked part of that bigger picture, but it’s not the only part. Perhaps equally important is the customer experience and all that entails.
“A data rich environment affords fuel dealers greater insight into their customers’ wants and needs and also allows dealers to have a say in how and when they make payments,” Coyle points out. “For a while now, technology has allowed us to leave a priced invoice at the time of delivery,” he continues. “Taking things to the next level, we see dealers offering online bill pay via a live customer web portal, and offering things like automatic credit card charges, or ACH (Automated Clearing House) withdrawals on the invoice due date.”
Updating company websites to include customer portals, then upgrading customer portals to allow for automatic payments: if the first half of this equation unlocks a world of valuable data, the second half hints at the many possibilities that world reveals. Those possibilities multiply exponentially when the data can be accessed in real time, as is the case with ADD Systems’ mobile Raven® software and back-office ADD Energy E3®.
“We have seen a significant move toward real-time data flow — whether it’s knowing where your trucks are at all times, or allowing your customers access to their account information 24 hours a day via customer portals — and this trend will continue,” Coyle predicts. “But the next evolution has already begun, and that is using our real-time capabilities to keep customers informed about what we do for them via text messages and emails. For example, some fuel distributors are using ADD software to send messages to customers about deliveries moments after that delivery has been made, and all of this is being done automatically.”
And the possibilities don’t stop there.
“In addition, ADD’s clients are using the information we have on record about customers to better target marketing promotions and services in a way that consumers will respond to most,” Coyle explains. In other words, data management isn’t just about increasing profits and efficiencies today; it’s about building a platform to drive profits and efficiencies in the future.
It’s helping improve a company’s customer experience while also moving that business’s overall operations efficiency in a positive direction – growing both the trees and the forest.