In April 2008, Americans logged 1.4 billion fewer driving miles compared to the same month in 2007. The cause is undeniably the cost of fuel. Hovering as a concern for years, crude oil prices are driving costs for everything up exponentially. Vending operators are hit especially hard due to manufacturer price increases and their own transport costs. It’s forced many operators to take serious stock of strategies to stay in the black.
There are no fast and easy fuel saving options. Many operators are cutting routes or minimizing service calls. Other operators are investing in technology that promises to increase efficiencies, thereby reducing fuel usage. Remote machine monitoring, computer software on truck engines and global positioning systems are all being considered and installed by more and more operators. Most operators find they must do a number of things that affect their fuel economy in order to improve their bottom line.
Cut Miles Logged
The most obvious way to handle increased fuel costs is to drive less. Dave Steinbach, president, Empire Vending, Liberty Lake, Wash., is planning to eliminate a route in order to save fuel. By cutting a truck, and unfortunately an employee, he can have fewer vehicles on the road. The route will be divided and added to other existing routes.
In conjunction with the route reorganization, Steinbach plans to reduce the number of times he visits accounts, going to a 4-day work week. He’s also looking at doubling up on best sellers to avoid empty spirals. “If an account you were servicing three days a week runs out of Cheetos,” said Steinbach, “then put two spirals of Cheetos in the machine and service it two times a week instead.”
John Elliott, president of Elliot’s Canteen Services, Decatur, Ill. has also cut his miles down. Elliott reorganized his route schedule to eliminate a day’s worth of deliveries. He has increased equipment and, in many cases, upgraded equipment. He’s worked with bottlers, specifically Pepsi, to swap out machines for larger capacity models in order to hold more of the products that were previously selling out. Due to larger and more beverage equipment, the machines don’t sell out as quickly, allowing him to eliminate daily service at certain accounts.
Drivers Prefer a Shorter Work Week
On 13 of his 14 routes, drivers work a slightly longer shift four days instead of five days a week. “The guys are pretty appreciative,” said Elliott. The drivers are told that if they do the job they’re supposed to do in the four days they’re scheduled to work, then they’re assured the fifth day off. Elliott has retained the right to call them in by 8 a.m. on the fifth day for emergencies or if they haven’t completed their work. He also staggers the drivers’ days off, so not all drivers are off on the same day. Additionally, Elliott avoids giving his drivers Monday or Friday off, as this would require a floater to cover too many accounts. “I felt a 3-day gap is stretching some of those capacities,” said Elliott. “It just didn’t appear to work.”
Drivers are paid the same 5-day base salary and commissions. The fuel savings comes from the more distant accounts. Drivers don’t have to make separate trips for these accounts, since they are already nearer when servicing other accounts.
Elliott has one driver who has elected to keep a 5-day work week because he’d have too long a shift fitting it into four days.
Before implementing the shorter work week, fuel was running Elliott $15,000 to $17,000 more than the previous year. With this new work schedule, he expects 15 to 20 percent fuel savings. Currently, it’s too early to tell if his estimates will be accurate.
Some may see eliminating service calls as compromising customer service. The driver being in the account less often risks the perception of a decrease in the level of attention the account is getting. Elliott, however, hasn’t noticed any such response. “Clients recognize we have additional costs and are amenable,” he said. He has even mentioned price increases, and clients haven’t balked.