Marketers Get Help Managing Fleet Headaches

As the everyday responsibilities of running a propane company compound, many marketers are finding that a fleet management company can help ease some of the burdens associated with handling their fleets in the most economical and thorough manner. Many have started to hire fleet management companies to oversee the maintenance of their fleets, including bobtails and service vehicles.

They have also sought the help of fleet management firms regarding vehicle acquisition, vehicle financing, maintenance, insurance, fuel management, remarketing, and other fleet management duties. Fleet management companies can help with one or several of those duties.

While a number of fleet management companies work with all types of companies nationwide, ARI, based in Mt. Laurel, N.J., is one of the first to have stepped into the propane arena. Several years ago, it recognized that the propane industry could use fleet management services. Rob Hoysgaard oversees the company’s utility and government group as director of sales support.

The company places propane, natural gas, electric, water, and telecom companies under that category.

 “If you talk to some individuals in the propane industry, they would tell you that they wouldn’t consider themselves a utility, but because it is a highly specialized industry with unique fleet needs, much like a utility or government fleet, we rolled it into that group,” Hoysgaard noted. Hoysgaard is active within the propane industry, serving on the board of directors for the National Propane Gas Association. Bill Doman, department head, sales support, for ARI will speak at this year’s annual conference in Atlanta. ARI also recommends propane as an autogas whenever it is appropriate.

Various fleet management companies do business overseeing vehicle fleet programs for all types of companies. And, like other fleet management companies, ARI can manage the vehicles from acquisition to disposal. But Hoysgaard notes that ARI specializes in what it refers to as complex truck fleets. The propane industry’s use of vehicles with valves and hoses fit that category. ARI works with propane fleets to handle tasks such as upfitting a chassis for different applications. And once the vehicle is on the road, ARI works with the fleet to use the best providers to maintain the vehicle. That has been especially important over the past several months, when extreme weather conditions have affected much of the U.S., putting pressure on fleets and the overall supply of propane. ARI has worked with customers to ensure their fleets are well serviced and on the road, so they can focus on delivering their product and servicing their customers.

One propane marketer that uses the services of a fleet management company is Superior Plus Energy Services (Rochester, N.Y.), which hired ARI to handle various fleet management duties. Superior Plus director of business development Bruce Ruppert has seen how ARI can help a propane company manage its fleet headaches.

Over the past few years, Ruppert has been involved with Superior’s acquisitions of other businesses. He was a Griffith Energy employee when Superior Plus acquired that company in 2010. Soon after the acquisition, he was given responsibility to manage Superior’s fleet of vehicles, which included propane bobtails and service vehicles along with delivery vehicles for fueloil and kerosene. Couple that with managing vehicles for Superior Plus’ Burnwell Energy business, and Ruppert was managing vehicles for three separate companies.

“If there were three ways of doing things, we were doing all three,” Ruppert said.

In addition to the tasks mentioned above, ARI also assists Superior Plus with regulatory compliance, licensing, and accident management. ARI also manages maintenance duties for Superior’s vehicle fleet, helping Ruppert avoid one of the main headaches of managing the fleet.

Superior Plus uses ARI’s Web-based system to track maintenance issues for every vehicle. Previously, Superior used a vehicle tracking system for its Griffith Energy business in New York, but the system was labor-intensive. A Griffith employee had to enter each invoice manually, and this system had not been extended to the other states in which it did business. If someone questioned Ruppert about a specific fleet expense, he could not provide any detail. “When someone would say ‘Why is this over budget?’ it was a question I could not answer,” he said.

He can answer questions like that now. Superior Plus began a pilot program with ARI in March 2013 to manage maintenance for a small portion of its fleet in New England. That was successful enough for Superior Plus to add the program to its New York and Pennsylvania locations toward the end of last year.

Como Oil & Propane (Duluth, Minn.) is another propane marketer that utilizes ARI’s services, having ARI serve as Como’s fleet manager. Covering northeast Minnesota and northwest Wisconsin, Como sells propane and fueloil through 10 locations. In addition to managing the bobtails and service vehicles for Como’s propane business, ARI is also responsible for its oil tank wagons and its fleet of about 12 semi-tractors.

Vehicle maintenance is one of the main duties ARI handles for Como. Jim Olson, Como’s director of safety, compliance, and asset management, can look at real-time reports on his fleet by viewing ARI’s Web-based system.

“At any given moment, our managers can pull up the information and see from an administrative standpoint where all the vehicles are,” Olson noted. The reports provide information such as notifications of when preventive maintenance is due; ARI also sends him e-mail alerts on abnormal odometer and fuel consumption data.

He can create his own detailed reports, with the ability to sort by repair item such as brake jobs. He can see which of his company’s divisions might be harder on the equipment than others, and he can also review cost per mile by division, company-wide, or by vehicle.

“It’s a staggering amount of data that no one in our company could have even started to attempt to collect and collate based on our old programs,” Olson stated.

ARI will also create special reports. For his accounting department, Olson needed to summarize various categories of maintenance and repairs by division and by month. “They just plug it into the financials, and they’re done,” he said. The fleet management company also manages Como’s relationship with its vendors. ARI pays the vendors and sends Como one bill, which took a big load off Como’s accounts payable department.

Superior Plus and Como Oil & Propane are just two of several propane marketers that are clients of ARI.

In the area of maintenance, ARI will manage the work that’s done on the vehicles, making sure the propane marketer is getting the right repair at the best price, which helps control costs. ARI operates three call centers 24 hours a day, seven days a week, to ensure repaired vehicles are returned back to the marketer as quickly as possible. The company will pay all the vendors and provide the propane marketer with one monthly invoice for maintenance as opposed to the marketer receiving many invoices from many vendors. ARI can help a small marketer that might use only one repair shop, or medium to large marketers that might need help with licensing and compliance in multiple states. ARI will customize its services to meet a marketer’s needs. The fleet management company offers various services to help propane marketers manage vehicle expenses.

Maintenance

ARI’s staff manages the bid process for maintenance on Como vehicles. Como gives ARI clearance to accept bids up to a certain dollar amount, which Olson describes as a real timesaver. Once the vendor provides an invoice, ARI immediately enters it into its online fleet management system, providing him with real-time data about his fleet.

“The main issue is managing our repairs, maintenance, and tracking all the data in real time,” Olson noted.

Olson also likes the customized reporting that he can get from ARI. When he recently needed to summarize various categories of maintenance and repairs for his accounting department, and he needed it in a specific format so he could send it every month to accounting, ARI handled that. The company also helps Olson shorten the time he spends dealing with vendor invoicing issues since it sends Como one bill per month for all its maintenance. “That reduced a tremendous load on our accounts payable department; I can’t begin to tell you the time savings that provided,” Olson stated.

ARI also works with Superior Plus in the area of maintenance. “They are our advocate,” Ruppert explained. Superior deals with vendors of all sizes, and they are now all part of ARI’s program. When a Superior Plus truck breaks down, the driver of that truck now calls ARI. A representative from ARI with mechanical knowledge then deals with the repair vendor.

Although Ruppert likes to think that his vendors are honest with him at all times, he appreciates that ARI looks out for him as it negotiates with vendors to keep prices down. In the past, Ruppert had no good way of managing that process because there were so many transactions. In the past, Ruppert received hundreds of invoices every month. Now, with one bill from ARI, he saves the labor required to enter all the data. In addition, he gets detailed reporting on the repairs. If he sees a truck repair price on ARI’s reporting site that looks unusual, he can drill down almost to the nuts and bolts to see detail on the repair.

For example, Ruppert can look specifically at brake jobs. If he sees more frequent brake jobs at some locations than others, he can investigate if drivers are abusing the vehicles or if he needs to buy better brake pads. When the company receives its financial reports, questions might arise regarding items in other areas of the business. “But there are no questions on the vehicles because we’ve got that all figured out by the time the financials come off,” he stated. “That’s a much better world for me to live in.”

He appreciates the improved control he now has over expenses, and he likes that his location managers also have some control over the process. He has given ARI the authority to approve any repair items up to $1000. The fleet management company sends an email to the location manager and copies Ruppert for any repair over that amount. He likes that his managers can control the bottom line for their specific locations.

Fuel Management

Ruppert’s one bill per month from ARI includes his company’s gasoline and diesel costs. Superior Plus drivers use a Voyager fuel card, and transactions on that card go through ARI’s online tracking system. He can determine just how much each location spends on fuel, and email alerts enable him to get a handle on driver behavior and possible issues quickly by notifying him if a driver using a truck with a 50-gal. tank purchased 60 gallons of fuel in one transaction, for example.

Inventory Management

ARI tracks vehicle inventory for Superior Plus. The online system includes each vehicle’s identification number, fuel tank capacity, and license plate number, and shows when the vehicle is due for registration and preventive maintenance. It also reports when his bobtails and tank wagons are due for their visual and leak tests.

“We’re actually having locations key in their mileage every week for the trucks so we can have that mileage for tax reports, and sometimes you need that for registration,” Ruppert stated. “Once I have mileage, if I’m trying to do periodic maintenance on a vehicle every so many miles, I know when that’s due.”

Other Services

ARI assists companies on the vehicle acquisition side, facilitating bids, obtaining financing, and working with the bank in processing payments. The company offers additional services such as leasing and financing, vehicle equipment and remarketing, risk management such as motor vehicle record checks and online safety training, and accident management and subrogation.

Although Ruppert and Olson use only a few of the services, they are sold on the concept of propane marketers using a fleet management company. “I think you will see this gain more popularity in the next couple of years as people see the true benefits of it,” Ruppert noted.     —Daryl Lubinsky