High Gas Prices Eating Into Bottom Line
LOS ANGELES — With gasoline prices matching 2008’s record highs in some parts of the country, many installing security contractors are reassessing their daily fleet operations to see where savings can be made.
A greater reliance on technology, emphasizing routine maintenance and enforcing stricter driving practices are some of the measures companies are taking to increase fuel efficiencies.
“The cost of doing business is tight enough as it is with shrinking margins. The additional gas expense could be a couple of points off your profitability, so it hits the bottom line hard,” says Matt Ladd, president of Exton, Pa.-based The Protection Bureau.
When the price of gas began to spike earlier this year, Ladd looked to his GPS system to maximize fuel efficiencies in his 62-vehicle fleet ofvans and cars.
“The first thing we did was turn on the speeding alerts and acceleration alerts. Not only is speeding extremely dangerous, it is also one of the biggest wastes of money,” he says.
Ladd has actively sought to achieve fuel savings throughout his operations. Older Chevy vans are being incrementally replaced with the smaller, more fuel efficient Ford Transit van. Products are drop shipped to customer sites when possible, saving the technician from first picking up products at the company’s warehouse. Other measures include trying to have as many technicians as possible work four 10-hour days, thus keeping work vans off the road one day per week.
“There isn’t one perfect solution. We are finding that it is many solutions and constantly keeping people alert,” he says.
Dan Budinoff, president of Stamford, Conn.-based Security Specialists has also realized fuel efficiencies with his GPS system along with taking additional actions. The company operates a 17-vehicle fleet, including Ford E150 vans and other vehicles.
Security Specialists has integrated a GPS system with its SedonaOffice back office software to track service routes and determine the most efficient routing for vehicle trips. Detailed fuel purchase reports generated by the program are also key.
“Now we can combine those together and find out who is being efficient and who is not. That has really helped us. I bet we are easily saving 10 percent each month,” he says.
Like Ladd, rising fuel expenses prompted Budinoff to activate excessive alerts on his GPS system to spot abusive driving habits. Idling is a particular stickler.
“We set parameters in the tracking system so that as soon as somebody violates one of the golden rules, like no idling for more than five minutes, we find out about it,” he says. “It was hot outside? Stay in the customer’s premises. It was cold outside? Stay in the customer’s premises.”
While gas prices have eased slightly in recent weeks, they are, on average, up about 30 percent compared to a year earlier. For example, Vector Resources Inc., a Torrance, Calif.-based IT and security systems integrator, saw its first quarter fuel costs spike to $33,000 from $23,000 compared to the same period in 2010.
To increase fuel savings as well as eliminate wear and tear on its 35-vehicle fleet, Vector utilizes medium duty box trucks to distribute products and other gear to project sites. Located near Los Angeles, the company’s vans, pickups and other vehicles ply congested freeways across Southern California. So, determining the most efficient route is a constant pursuit, says fleet manger Will Smith.
“Routing is such a big deal for us. If we have multiple deliveries in a certain area we try to make use of one truck instead of multiple trucks,” he says. “Just managing our weight load efficiently also allows us to save on gas.”
At the F.E. Moran Alarm corporate offices in Champaign, Ill., General Manager Michael Bunch continues to look for ways to reduce the company’s monthly fuel costs, which he estimates at $18,000. A Ford Transit van is currently being field tested in consideration for augmenting a fleet of full-size Chevy cargo vans. An upgrade to the branch’s GPS system is also being explored. Bunch has especially been preaching a fundamental message about regular vehicle maintenance, lessening cargo weight, as well as conducting random vehicle inspections. Being price conscious at the pump has a big part to play as well, he says.
“None of the technicians, myself included, would ever look at the price. Filling up at a gas station right off the interstate may be convenient but typically it’s not going to be the best price,” he says. “We encourage everybody to fill up where they fill up their own personal vehicles.”
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