Largest family-owned school bus contractor quadruples propane school bus fleet

(Georgetown, TX) July 19, 2016 – CleanFUEL USA announced that Cook-Illinois Corporation, the largest family owned and operated school bus contractor in the United States and the sixth largest among all school bus companies nationwide, is quadrupling its current fleet of propane autogas school buses for next year and, for the first time ever, has not purchased any diesel buses. Its most recent order includes 50 Saf-T-Liner C2 units from Thomas Built Buses equipped with CleanFUEL USA Liquid Propane Injection (LPI) systems.
Thomas Built Propane School bus

School districts across the country are shifting their bus fleets from diesel fuel to propane autogas to stretch strained budgets and promote cleaner air. Roger Bannerman, fleet director for Cook-Illinois Corporation, is leading the trend and experiencing significant ROI.

“We’ve had a big problem with the newer 2007 and 2010 emission diesel engines,” said Bannerman. “Maintenance on these buses is costing us a fortune.” Concerning maintenance on his propane autogas bus fleet he said, “It has been a great experience with no big repairs, and we follow our normal preventative maintenance schedules with no additional work.”

In addition to saving time and money on maintenance costs and excellent cold-weather starting, the low-cost of fuel and infrastructure greatly influenced Cook-Illinois’ decision to expand its propane autogas bus fleet. “Paying $1.29 for propane autogas and the ease of setting up infrastructure on-site convinced us to switch,” said Bannerman.

“Cook-Illinois recognizes the immense benefits that propane autogas buses offers,” said Curtis Donaldson, founder and president of CleanFUEL USA. “We are thrilled to partner with Thomas Built in providing Cook-Illinois with the best school bus transportation option on the market.”

About CleanFUEL USA:
CleanFUEL USA, the nation’s first developer of liquid propane fuel injection systems manufactures propane autogas dispensers and refueling infrastructure. Headquartered in Georgetown, Texas, with an engineering division in Wixom, Mich., CleanFUEL USA celebrates more than 20 years of innovation. Setting industry standards with a complete alternative fuel solution, CleanFUEL USA products offer unsurpassed economic and environmental advantages.

Conquering the Challenges And Growing Your Business

Seeing the big picture, maximizing the value of your business, developing banking relationships, and deciphering and understanding the “numbers” are four challenges that propane marketers must conquer to successfully grow their business in 2016. Mike Shilts, vice president of marketing and business development for energy management software company K&K Management Solutions (Indianapolis), notes that propane companies must know their “key business indicators,” also known as KBIs or “dashboards.” The first of the four challenges — “seeing the big picture” —means knowing exactly what those indicators are for your specific business.
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Shilts discussed the importance of key business indicators during a session titled “Growing Your Propane Business in 2016 and Beyond: Conquering Four Challenges” at the National Propane Gas Association Southeastern Convention in Nashville.

The number of deliveries and gallons per delivery are among the key business indicators. “If you don’t know what those key indicators are for your company, you’re lost,” said Shilts, a CPA with bachelor’s and master’s degrees in finance/accounting and psychology. When he asks propane marketers how many gallons they deliver each week and the location, many say they think they know the answer. “You have to know,” Shilts stressed.

At the Southeastern event, Shilts showed slides displaying key business indicators, explained why propane marketers must follow them, and most important, discussed what the variance is between an indicator number and what the marketer should expect it to be.

“If there’s a variance, then you need to take those key indicators and drill down and say, ‘What caused the variance?’” He has implemented key business indicators for about 60 companies, including propane businesses and companies in other industries.
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Shilts is presenting on this topic because the current times are challenging for businesses. “Small business owners often do not understand some of the key areas to make their companies successful,” he noted.

Maximizing the value (and earnings before interest, taxes, depreciation, and amortization, or EBITDA) of your company, or getting the most money when selling the company, is the second of those key areas or challenges Shilts describes in the presentation, and he discussed cash flow and how to avoid a “haircut.” He explains that with a haircut, a seller of a business starts out thinking his company is worth a high amount, but after going through due diligence he discovers the value is nowhere near the initial offer.

“When I say ‘maximize value,’ it’s how you get the most money for your company, and I also touch on how to not get ‘taken’ either.” He explained how to look at your company from the view of the person or company buying it. Marketers selling a company can avoid a haircut by managing their business effectively, watching their costs, and understanding that the gallons they sell are not all equal. For example, a high-margin residential gallon is nowhere near the same as an industrial gallon or a transport gallon, according to Shilts.
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“Many people look at the number of gallons they sell and say, ‘That’s my company’s potential value,’ but what counts is the margin [cash flow] you receive from those gallons.” At his presentation, he provided examples of three companies that each sell about the same amount of gallons, but the margin they receive is completely different.

The third challenge, developing banking relationships, involves creating business plans, figuring out how to get funding, and securing letters of credit. Shilts explained what banks look for, or don’t look for, when deciding whether to lend money.

“There is a four-letter word with bankers, and that word is ‘risk.’ All bankers are concerned about avoiding risk,” he said. They want to know if your company will create enough cash flow to pay back the loan while also paying your employees and meeting all of the other business obligations.

Bankers will see your company as low risk if you strive to do well in meeting the four challenges.

Deciphering and understanding the numbers — the financial statements — is the fourth challenge. Using simple terms, he explained the four financial statements: the balance sheet, income statement, cash-flow statement, and retained earnings.

The balance sheet, he explains, never states, “for the period ending.” Balance sheets are a snapshot at a certain point in time.

On Dec. 31 of any year, the balance sheet’s accounts receivable balance might show a very high or very low number, partially depending on the business’s number of pre-buy or budget customers. “It depends on when you’re looking at it, and what you’re looking at, but the balance sheet is extremely critical to grow your company, because if you don’t have the equity, you’re not going to be able to grow. Why? Because the bank is not going to lend you money because you are not going to meet [its] covenants.”

Shilts, who also spoke in March at M-PACT in Indianapolis about the four challenges, tells attendees of his sessions, “Don’t pay outside accountants to regurgitate your numbers.” Marketers often pay good money for accountants to give you back exactly what you gave them, only in a nicer form.

“You don’t want to pay for that,” he stated. “You want to pay for tax advice, for analysis of the numbers. Don’t pay a CPA or other outside firm $40,000 per year to enter your data into Excel or other format. Get Quickbooks or another inexpensive accounting program. Don’t spend money on things that don’t give you any real value. Put your own numbers in and only pay outside accountants for value-added analysis that increases your bottom line.”    —Daryl Lubinsky

Early Intervention Strengthens A/R Health

By Diane Schumm…  You may already be aware of the effect of delinquent accounts on your business, but you may not know that the age of delinquent accounts contributes to the overall success rate for recovery of lost income. As a delinquent account ages, the likelihood of collectability decreases, increasing the amount of income you’ll have to write off each year.
Schumm

Why Early Intervention Is Critical

You rely on your customer relationships. They build your repeat business, provide referrals, protect your reputation, and guarantee longevity. Wouldn’t you rather focus on building even better relationships with your most valued clients instead of on clients avoiding your requests for payment? You may want to give your customers more time to pay their delinquent accounts, but the Department of Commerce reports:

a.) Accounts three months past due are worth $.83 on the dollar
b) Accounts six months past due are worth $.67 on the dollar
c) Accounts one year past due are worth $.45 on the dollar, and so on (see graph at right)

Accounts eventually deteriorate to a point where they become practically worthless. In addition, the longer you wait, the more aggressive you have to be to recapture that lost revenue. When you establish contact early, you can maintain a customer service approach with your clients. Instead of a reprimand for late payments, you remind them of their balance, make inquiries into their situation, offer assistance, education, and support. You’d be surprised at how receptive and responsive customers are to this approach.

Questions to Determine How Age Effects Your Accounts
If you still wonder how age directly influences your accounts, ask yourself the following questions:

1. How many accounts do you have on the books that are causing you concern?
The number of accounts that are of concern will influence the number of accounts that begin to age. The larger the number, and the greater the balance, the more effort an already over-stressed staff will have to exert to recover the debt, leading to a greater likelihood of those balances sliding from 30 to 60 to 90 days overdue.

2. How many accounts will experience a “forward flow”?
Many business owners focus on accounts that are 90 to 120 days old, but the problem is that while you’re attempting to collect on older accounts, your 30- to 60-day-old accounts are sliding forward another 30 days. While trying to address the cycle, new accounts become 30 days delinquent, further perpetuating the vicious cycle.  

3. If you could focus all of your efforts on the 30- to 60-day-old slow-pay accounts this month, how many do you think you could prevent from reaching the 90-day aging period next month?
If you’re able to focus your efforts on halting the aging process, you will recover more income and have greater customer retention as your efforts can revolve around education and prevention rather than collection.

When a Third-Party Partner Is Necessary
By partnering with a dedicated accounts receivable (A/R) management vendor, you can focus your energy on sales and production while leveraging third-party authority for your accounts. Unlike a traditional collections agency, an accounts receivable vendor focuses on customer retention by using non-alienating methods to alert customers to their delinquent accounts. The approach recognizes that your customers are the heart and soul of your business and places greater value on those relationships.

An accounts receivable management team can act as an extension of your own internal billing efforts or can take the burden of account management off your plate. A reputable A/R vendor can handle everything from initial billing to notification of delinquency and will even seek legal action if warranted and authorized by your company. They will truly serve as a partner in maintaining your healthy A/R. Associating with a third-party A/R management vendor that can effectively promote customer loyalty vs. just being your last resort to profit losses is one of the best ways to prevent delinquent accounts from aging.

Preventive Maintenance Equals Positive Results
There are a number of positive benefits to focusing on early intervention for your accounts. Not only will you experience greater recovery results, but you’ll receive better responses from your customers. The number of delinquent accounts will be reduced in a hassle-free manner, which will lead to fewer collection issues down the line. The benefits to your business are immeasurable when you make A/R management a priority.

Diane Schumm, This email address is being protected from spambots. You need JavaScript enabled to view it., is vice president of corporate services for TekCollect.

Yellowstone's Innovative New Propane Cylinder Recycling Program

The Yellowstone Park Foundation and Bernzomatic, a hand-held torch and fuel cylinder company, launched a disposable camping fuel cylinder recycling program for Yellowstone and Grand Teton National Parks. The program aims to help park visitors properly recycle propane containers commonly used to fuel lanterns, camping stoves, and grills. The Foundation notes that the containers are usually either left at campsites or placed in improper recycling containers. This recently introduced sustainability initiative includes the rollout of a new recycling vehicle, which park officials showed off at a special event on June 4, 2016.
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The Foundation notes that the sustainability initiative and the recycling vehicle “set [a] new industry standard for protecting natural resources and reducing waste in U.S. parks.”

This program aims to solve an environmental challenge facing Yellowstone: many of the park’s millions of annual visitors use propane cylinders in camping stoves and grills during their stay but often don’t know how to properly dispose of the containers. Visitors tend to leave them near campsites or in the incorrect recycling containers, rather than properly disposing them in designated propane recycling bins.

“Proper recycling of all camping materials — including the fuel cylinders used each season — has always been a focus at Yellowstone; however, the park’s original infrastructure could not keep up with the number of cylinders used,” said Karen Kress, president of the Yellowstone Park Foundation. “We are grateful for Bernzomatic’s partnership in uncovering a long-term cylinder recycling solution that also makes the process simpler for park visitors.”
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As part of the program, Bernzomatic invested significant resources to overhaul Yellowstone’s existing cylinder reclamation vehicle. The company’s engineering, product development, safety, and regulatory teams collaborated to create this first-of-its-kind design with enhanced safety features. The new vehicle now removes residual propane from discarded fuel cylinders and processes them for recycling 20 times faster than the original vehicle.

“This partnership is a natural extension of our Bernzomatic CylinderSafe program, the first and only public education program on non-refillable fuel cylinder safety,” said Mike Verne, general manager of consumer products for Worthington Industries, parent company to Bernzomatic. “Through this initiative with Yellowstone, we want to make it as simple as possible for park visitors to access important cylinder safety and disposal information and reduce waste in the parks.”

To make the recycling process simpler, Yellowstone and Bernzomatic are also renovating the park’s propane recycling bin infrastructure by making the bins more easily identifiable, distinguishable, and uniform in color. The recycling bins will have updated signage that clearly communicates the type of cylinders that are acceptable to discard in the bins. The organizations are also working to educate park visitors about cylinder recycling by sharing program information on their websites and social channels and across park lodges, visitor centers, and local convenience stores.
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To find out more details about the program, BPN contacted Verne with some additional questions:

BPN: Can you provide more history on how and why the program came about?

Verne: In 2005, Yellowstone became the first national park to recycle small propane cylinders. Since then, the park collected, crushed, and redeemed an average of 16,300 cylinders per year from the greater Yellowstone area; however, Yellowstone was not able to keep up with demand or meet safety requirements with the original propane recycling machine [it] had in place. Yellowstone recently contacted Bernzomatic to rebuild the propane recycling machine to improve efficiency in time for the park’s peak visitor season in 2016 in order to maintain the park’s natural beauty and protect its employees and wildlife.

BPN: Can you provide more detail on how the process works and how the machine removes the residual propane from the cylinders and processes them 20 times faster than the original unit?

Verne: The previous vehicle required upwards of 30 minutes to remove residual propane from one cylinder; the new recycling vehicle can remove residual propane from one cylinder in approximately one minute. The new recycling vehicle only requires one individual to operate; whereas the previous vehicle required multiple individuals.

How the process works:
• The recycling process begins by removing residual propane from each cylinder so it can safely be crushed.
• Once residual propane has been removed, an operations staff member places the empty cylinder in the compactor to be crushed.
• Yellowstone will then be able to sell the scrap metal to recycling locations.
• Yellowstone will also be able to recycle and use the remaining propane for propane-powered equipment throughout the park.

BPN: Can you tell us about the capacity of the recycling vehicle? What fuel does the vehicle run on?

Verne: The vehicle in Yellowstone only recycles 14-oz and 1-lb non-refillable cylinders. We do not crush or recycle the larger cylinders that can be refilled. The silver 30-lb cylinders you see on top and sides of the vehicle are actually used to safely collect the residual propane from the cylinders that we recycle. Once the 30-lb cylinders are filled, Yellowstone then uses the recycled propane to power the vehicle and fuel equipment such as lawn mowers and forklifts throughout the park.

BPN: Talk about Worthington being a parent company of Bernzomatic and how that relationship came about.

Verne: Worthington Industries bought Bernzomatic from Irwin Industrial Tool Co., a subsidiary of Newell Rubbermaid Inc., in 2011. The Bernzomatic brand is part of Worthington Industries’ consumer products business.

—Daryl Lubinsky

Landscape Company Upgrades All Equipment to Propane

Historically, Tarantino Landscapes (Bridgeport, Conn.) has used mowers and pickup trucks that ran on gasoline. Over the past couple years, the business, which is a sister company of propane company Hocon Gas (Shelton, Conn.), is going through the process of switching its entire fleet of trucks and equipment to run on propane. Tarantino is a full-service landscape company that works on commercial and residential properties, schools, and parks. It includes a separate division for baseball, football, and soccer field renovation and maintenance, mound and base installation for baseball fields, and field lining. For residential customers, the business provides services such as spring clean-up, tree or shrub plantings, or planting a completely new garden. Tarantino’s website states, “Tarantino Landscapes has made it a priority to use the latest in propane landscaping technology to maintain equipment efficiency, lower fuel costs, and bring awareness to green concerns.”
Hocon

“We’re not completely propane yet, but that’s what we’re working on,” said Don Dickson, operations manager at Tarantino Landscapes. “As we replace [machines], we’ve been replacing them with propane units.”

Six to eight of the trucks in the fleet are propane-fueled. The Ford F-250s and F-350s, which pull trailers, use the Icom liquid-injection propane system converted by Don Cusson from Cusson Automotive in South Windsor, Conn. The landscaping company formerly used gasoline- and diesel-fueled vehicles. The first truck conversion took place three years ago, another was converted about a year later, and last year the company converted four trucks to propane.

The conversion of the mowers took place on a similar path. Tarantino converted two Exmark mowers about three years ago, and they worked well. Now the mowers come from Exmark already converted to propane.

Dickson has noticed no difference in power and speed compared to gasoline and diesel trucks. Tarantino workers who drive the trucks every day use propane almost exclusively. Running out of propane is rarely a problem because the Tarantino location is only about a couple hundred yards from a Hocon Gas site. “You really wouldn’t know they’re propane-powered,” he said. “They run clean, and we have had no issues with them.”

The same holds true for the propane mowers, most of which are Exmark Lazer 60-in. and Exmark Tracer 52-in., along with a couple 48-in. models. The mowers perform “exactly like gasoline mowers,” Dickson noted.

“When they first came out, they were a little lacking in power, but Exmark added more powerful Kohler engines with increased horsepower in its propane unit [from 16 to 18],” he explained. “Now it’s fine. We don’t use any additional fuel, so even going up to a bigger horsepower engine, the fuel consumption seems to be pretty much the same. Now it’s exactly where the gas was as far as power and climbing hills.”

Dickson added that the mowers have been well received by clients. The company performs much of its work around senior housing and schools, and he has heard compliments from clients about the mowers emitting no fumes, and they appreciate that the company is not polluting the air.
“We’ll continue doing four trucks a year, converting them and our older gasoline mowers to propane mowers, so eventually our entire fleet will be propane.”

Hocon Gas vice president of operations Bill Cummings noted that Hocon is active in the propane autogas business. Hocon services the Town of Shelton’s school buses and soon the City of Waterbury’s buses, along with a pump station for the town of Torrington school buses. About half of Hocon’s vehicles run on propane, including two Freightliner S2G bobtails. Hocon Gas has been in business more than 60 years. Tarantino and Sons Landscaping, founded by Generoso Tarantino in the 1950s, changed its name to Tarantino Landscapes in 1987. Generoso’s son Gino Tarantino, who is vice president and CFO of Hocon Gas, and Hocon president and owner David Gable became partners in the landscaping business about 10 years ago.

Regarding the mowers, Cummings noted that Tarantino Landscapes has purchased more than 15 propane-powered lawn mowers over the last few years. “We didn’t have an old fleet, so we’re not changing any out this year,” he stated. “But next year, we probably will, and we’ll go propane with those, too.”

He is excited to see the landscape business switch over to propane trucks and mowers. “The mowers are powerful, and of course the pickups are all running well. We’re having a good experience with this changeover. You’ve got to try it. People hesitate, but we’ve had absolutely no problems at all.”     —Daryl Lubinsky