Building a Profitable Tank Monitoring Strategy

When should I fill a customer’s tank? This is the fuel delivery conundrum in a nutshell:

• If you deliver too early or often, you can leave margin on the table with inefficient drops.
• If you wait too long, you may decrease your truck-rolls, but increase the likelihood that a customer runs out.

It’s an important decision and one that is getting much more focus as organizations look at propane tank monitoring.

For most, it’s not a decision of if they should use tank monitoring to get a clear picture of customer tank levels, but a question of where to start. In this blog, we want to look at customer types that are perfect entry points for tank monitors.

5 Account Characteristics Predictive of Tank Monitoring Success

Propane suppliers that are successful with tank monitoring set priorities. While having a tank monitor on every tank might be the long-term vision, it doesn’t make economic sense to start there.

Here are five common characteristics of good candidates for tank monitoring:

1.  Inconsistent Usage
   Residential accounts that only use fuel for heat can be managed well with K-factors and degree days, but other types of accounts can exhibit unpredictable usage patterns. Commercial accounts and vacation homes are examples, but there are many accounts where seasonality makes tank levels hard to predict.
2. Multiple Deliveries per Day and Week
   If you are delivering daily or weekly to a customer, knowing real-time tank levels can help you to ensure the best routing in coordination with other key customer accounts.
3. Multiple Usage Types
   Accounts with multiple usage types, in addition to heating, will often show inconsistent usage. Monitoring can help prevent run-outs by ensuring you know when huge drops in tank level happen.
4.  Risk Aversion for Runouts
   There are some accounts, often commercial, where a run-out of propane can lead to a very unhappy (and probably lost) customer. This takes top priority over just efficiency.
5. Isolated Customers
   We all have remote customers that require a driver to travel long distances. With the security of a tank monitor, you can plan fewer trips and ensure the largest drop sizes without risking a run-out.

These are some of the high-level reasons for using tank monitors on customer accounts. Think of your portfolio of customers right now. There are likely customers that fit one or more of the above characteristics.

Develop a Game Plan for Tank Monitoring

Tank Monitoring is about ensuring higher margins for your business, while improving the overall customer experience. However, not all customers are created equal, and when considering tank monitoring, it’s important to start with the accounts that can have the greatest impact.

One way to do this, is to perform a Delivery History Analysis, which many tank monitoring companies provide. This analysis can look at past deliveries by account to identify and rank the customer accounts where tank monitoring would be the most profitable.

A game plan like this will provide the basis for deciding how many monitors to buy and determining your deployment strategy. It will also ensure that your tank monitoring project provides a fast, profitable return on investment.

Interested in a free delivery history analysis? Schedule one with a tank monitoring expert!