Get the Most Value from Your Propane Equipment Distributor

by Donald Montroy, Bergquist Inc.

Propane equipment distributors now offer market knowledge, product demonstrations, business data, and much more

You probably know exactly where to go for your favorite tank set equipment items. You know where to purchase the regulators, pigtails, copper or polyethylene tubing, brass fittings or flex risers of your choice. You also know which supplier has sufficient inventory of what you need and how soon they can get it to you. Breaking down bulk shipments, maintaining ample inventory, and timely and accurate shipping have been the hallmark of propane equipment distributors from the beginning of the distribution model. The role of distributors has changed over the years, however. Propane equipment distributors now offer much more value than simply shipping the equipment you require. The distributor has evolved into a trusted channel partner that provides value-added services to help you grow your retail propane business.

Traditionally, wholesale distributors receive inventory from many different manufacturers to resell to businesses that typically serve one industry. There is tremendous value for propane marketers in buying smaller quantities as opposed to purchasing in bulk. Breaking bulk is fundamental to what distributors do. It allows companies to purchase multiple different items required to run their business at lower volumes and from a single source. Breaking bulk saves propane marketers both time and money by not having to shop around to purchase necessary equipment.

Breaking bulk is only part of the inventory equation of a wholesale distributor’s traditional value. To serve a single industry successfully, distributors should maintain extensive inventory from a variety of manufacturers. Maintaining good inventory for customers is critical if a distributor wants to provide the best service possible. Equipment distributors operate as a propane marketer’s personal warehouse.
Partnering with parcel delivery and LTL (less-than-truckload) services – or operating their own delivery fleet – allows distributors to deliver critical items to propane marketers just in time. Ample product inventory from distributors provides pro-pane marketers with peace of mind.

Available inventory should also be delivered quickly and accurately. Vital tank set or repair jobs often depend upon necessary equipment being delivered in a timely manner. End-consumers can be very intolerant of slow service from their propane supplier. It’s especially true if a customer is lacking hot water on a chilly autumn morning, without heat on a freezing winter evening, or cannot use their propane-powered fleet vehicle any day of the year. Slow and inaccurate shipments waste time and money for propane marketers. Receiving orders that have been shipped correctly instills confidence in propane marketers that their equipment distributors can deliver effectively and efficiently.

Additionally, distributors are often viewed as the sales arm of manufacturers, especially smaller manufacturers. By partnering with manufacturers, propane equipment distributors can offer sales expertise across all of their product lines. This allows manufacturers to focus on what they do best: innovating and making high-quality propane products. Propane equipment distributors also work with manufacturers to develop new products that come from ideas in the field. Distributors are the conduit between propane marketers and the manufacturers that make the equipment used in propane systems every day.

As equipment distributors have mastered the tasks of breaking bulk, maintaining ample inventory, shipping quickly and accurately, and selling prowess, they’ve grown to provide even more value to propane marketers. This newer value includes extensive product knowledge, onsite product demonstrations, and various code and regulation education.

It seems like common sense that wholesale distributor employees have working knowledge of the products they sell. Sadly, this isn’t always the case. Fortunately, the propane equipment distributors in the United States have considerable knowledge of the propane equipment they sell day-in and day-out. This is a tremendous asset to propane marketers that experience employee turnover. Most propane equipment distributors have readily available product information on their websites for quick access at the click of a button.

Product information shouldn’t be limited to sales brochures or product specification sheets, however. Product demonstrations, whether at an industry trade show, a distributor open house, or at your location at a time convenient for you, are critical to getting the most benefit from propane equipment products and improving your operation. Propane equipment distributors’ sales staffs are an excellent source to getting the best product information available anywhere.

Many people employed by propane equipment distributors have also worked on the retail side of the propane industry. Many of them are knowledgeable about various codes and regulations. Furthermore, many know when and why current regulations came to be. That regulation backstory is important to know as your employees conduct their daily activities. Code and regulation knowledge provides propane professionals with confidence in their work and instills trust in the public, knowing the equipment you install is safe.

Until recently, many propane equipment distributors provided Certified Employee Training Program (CETP) tutorials, either by module or in its entirety, and CETP proctoring. With the change to the new PERC Education Program (PEP) and online testing in January, much of the training is likely to disappear. The good news, however, is that the training opportunities provided by the Propane Education & Research Council (PERC) are more extensive than ever. Many propane equipment distributors can make you aware of the most impactful training opportunities for your specific business. Distributors can help point you in the right direction to the most applicable and up-to-date PERC training resources for your team.

The next evolution in propane equipment distributor value will move beyond product knowledge, onsite product demonstrations, and code and regulation training. The future value in distribution will come from offering operational efficiency through analytics, providing marketing resources and support, identifying opportunities for gallon growth, and identifying opportunities for energy diversification.

Analytics through purchase data and past purchasing behavior can be very impactful for propane marketers. It can highlight where growth opportunities are that a marketer may not have realized. Certain geographical areas may be gaining as a share of overall gallon growth, or perhaps key segments like agriculture or commercial/industrial require more attention and focus. This analysis allows you to direct your resources to the market segments that provide the best return on investment.

Furthermore, telemetry technology such as remote tank monitors and smart meters provide consumption data that aid in operational efficiency and the potential for competitive advantage. More efficient routing through tank monitor use, or billing based on monthly product consumption, can set your business apart from your competitors. Leveraging analytics through telemetry equipment will allow propane marketers one more differentiator going forward.

Another important yet often overlooked function where propane equipment distributors can assist you is with marketing communications and messaging. Equipment distributors possess a tremendous amount of experience in both product marketing and branding. Ask your distributor for help with a marketing campaign for the new product in your showroom that you want to grow. Lean on your distributor to help you craft your value proposition message to customers. Distributors can help you identify target audiences, propose a clear message that engages them, and help with the design and creation of marketing collateral. Equipment distributors have experience understanding which communication channels (e.g., email, print, or social media) may work best to reach your audience. Utilize the marketing skills propane equipment distributors have to help you achieve the marketing goals you’re working toward.

Propane equipment distributors also have a very good sense of industry trends. They know which segments of the industry are growing, or declining, by region. They understand which products are successful in certain areas and which are not. Lean on your equipment distributor to learn which segments are most likely to help you grow your business. You will get an honest answer. After all, a distributor’s success is incumbent upon your success.

The opportunity that propane provides for power-generation products (including EV charging stations) come to mind. The ubiquitousness and reliability of propane make it an ideal choice for power generation. That fact, coupled with the unreliability of the electrical grid across much of the country should make the power generation market very appealing to propane marketers. Your equipment distributor should know which power-generation products they see as leaders in the market, which technology PERC currently endorses, and geographical areas of growth for power-generation equipment around the United States.

Your equipment distributor has also most likely diversified their product portfolio to include an adjacent industry to liquified petroleum gas. They’ve done so even if on a very limited level and scope. If they haven’t diversified already, they’re taking a serious look at where they can successfully do so. Ask your distributor where other retail energy opportunities may lie.

Alternative off-grid energies to complement your existing propane business seem like a natural progression. It’s reminiscent of the transition from delivering coal or ice to delivering fuel oil, and eventually moving on to offering propane. Propane use will be around for many years but that shouldn’t prevent you from looking at alternative energy opportunities that make sense for your business. Partner with your current propane equipment distributor for diversification discussions. You are likely to reap the rewards of shared ideas.

Using your propane equipment distributor solely for the items you need to keep your operation running is overlooking valuable resources. Lean on your distributor to help you grow your business. Distributors want you to succeed as much as you do. The propane equipment distributor / propane marketer dynamic is the most collaborative business partnership in our industry. And deservedly so.

Donald Montroy is Vice President of Marketing for propane equipment supplier Bergquist, Inc. He can be reached at donald.montroy@bergquistinc.com or 616-460-3299.

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