The adage "slow and steady wins the race" most assuredly applies to the team at Propane Levac when it comes to its approach to implementing a tank monitoring program across its company. The team has been intentional and strategic about adding the technology in each of its customer segments since the very beginning, and Christian Levac, president of Propane Levac, credits a long-term partnership with tech providers like Otodata, as well as comprehensive training, to their success in the endeavor.
Headquartered in eastern Ontario, Canada, the liquefied petroleum gas (LPG) retailer was started in 1993 by Jean-Marc Levac, who owned a small agricultural business and sought to expand his range of services by selling propane to customers in the area. Propane Levac currently serves more than 37,000 customers in the Ontario and Quebec provinces and employs more than 120 employees. Christian and his brother Étienne have joined their father on the leadership team and are focused on future growth for the company, including through the implementation of new tech to improve longstanding business challenges.
The retailer is currently monitoring approximately 10,000 installations, from large commercial outfits to small residential customers. Learn more about Propane Levac and its journey with tank monitoring ahead.
How many of the accounts in your customer base use tank monitors? Are there any specific segments where tank monitors play a more prevalent role?
It’s a mix of segments between residential and commercial customers. Approximately 30% of our accounts are monitored. Almost all of the corn dryers — agricultural customers — are equipped with monitors, as well as all of our bulk facilities.
All of our bulk facilities, including our two rails terminal, are monitored by tank monitors. Then we encourage monitoring in a commercial application when needed and in residential applications as well.
With our accounts that have a secondary source of heat — such as fireplaces, a heat pump, etc. — we cannot accurately gauge a precise K-factor (or degree days). On these accounts we prefer to use a monitor to help track usage.
Another example is with low-volume customers where we have little to no predictability for the frequency of delivery needed.
With all the storms and severe weather we’ve been having in recent months — and resulting power failures — a lot of our customers now have generators, and with this use case, it’s nearly impossible for us to predict their delivery frequency. Here again is a perfect use case for a tank monitor.
What was your original strategy for implementation? Has it changed?
We started pretty much from day one with monitors. We were using another supplier before Otodata, but obviously the cost of tank monitoring back then was extravagant. You would really need to think and consider the return on investment [ROI] with any tank monitoring solution you purchased.
Otodata offered a low-frequency, lower-cost alternative, which made a lot of sense for our company. It’s been around 10 years since we made that move, and in that time, we’ve honed our strategy to one that is precise and intentional about the customers we need to monitor. In the beginning with implementing tank monitoring, I was worried about some of the materials used for monitor housing and wiring, and about the battery life of the monitors.
The technology and the materials used for these monitors has continued to improve over the years, though. And with our costs of delivery and operation increasing consistently, it has become imperative for us to try to lower those expenses, including the cost of delivery per stop. Over the last few years, we’ve been installing anywhere between 1,500 to 2,000 monitors per year, and we plan to maintain that growth this year.
We’re currently running a program with Otodata to analyze our customer usage and evaluate the return on investment for the tank monitors we are implementing. If we could get to 100% of customers monitored and it would make financial sense, we would do it — but it’s not an easy task to navigate the installation of 3,000, 4,000 or 5,000 monitors a year. There’s both the physical installation and that time to keep in mind, in addition to linking everything and setup back in the office.
What are the biggest benefits with tank monitoring for customers and drivers?
On the customer side, one of the biggest pain points in the business is run outs. And for us, how do we prevent those run outs? The tank monitors have helped a lot with mitigating customer run outs — as much as we can do to increase predictability in our business is good.
For our drivers, the monitors help to find the balance in delivery scheduling — lowering risk, increasing efficiency and ensuring they are right where they need to be, not where they think they need to be. The app [launched by Otodata about five years ago] has also been a huge benefit to both our customers and our drivers and dispatch. Among other features, customers can quickly and accurately monitor their levels in the app.
We’ve also launched our own portal for Propane Levac. In the portal, customers can request a delivery monitor, order gas, view usage history, and see price fluctuations and the percentage fill in their tank at any given time. With the portal and our enterprise resource planning system linked, our operations have become so much more seamless.
How did you train your service technicians for tank monitor installation and operation?
When we implemented the monitors, Otodata provided us with installation guides, which we give to our install crew. It’s a regular part of our training now — we hire a new driver or technician and then teach them how to understand the difference between different monitors and their applications.
Otodata also sends regular guides and notifications about key updates to the monitors and their operating systems, which are helpful for keeping our technicians up to date with the technology. Once the technician is trained, installing a new monitor or replacing an old one is basically plug-and-play, and everything else is done on the back end.
What are the biggest pain points in tank monitoring currently?
Cost, hah! The lower the cost, the easier it is for us to install in different applications. It’s important that as the cost of the technology decreases, the quality of the hardware does not do so as well. Additionally with cost, you have to factor in the ROI on each and every monitor. Is there an advantage to monitoring this particular customer or another? And if not, we change our strategy accordingly.
Another huge paint point is battery life of the monitors — and not only battery life, but also the reliability of the appliance. We don’t want to have to swap a thousand of them a year. It’s not like you’re fixing a portal — you’re fixing something you must send a technician out for a service call to repair. They need to be reliable when they are deployed and for a long while after.
How do you plan for repairs and service with your drivers?
We try not to mix deliveries and monitor service. Our bobtail drivers stay busy with delivery, and especially in the busy season, we need every driver out delivering fuel. This is particularly true on the bulk delivery side. Most of our drivers are trained and know how to swap out a monitor, but there’s just better use of a bulk truck than swapping out tank monitors left and right.
How does weather play into your monitoring service & implementation strategy?
We’ve talked about the overall costs of operation going up for propane marketers — and this applies to everything from fuel and equipment to labor and technology. Being able to efficiently deploy drivers and service techs where they are needed most, especially during severe weather events and colder weather, is paramount.
As much as I want to track usage on a K-factor or days interval, I’m never as efficient using this method as if I have monitors tracking that information for us on the harder-to-reach customers. In the summers, a lot of residential customers in Canada heat their pools, and in the winters, a fireplace or generator may be the inconsistent use case. Monitoring helps the customer and us in all these diverse situations.
What advice do you have for the marketer on the front end of implementing tank monitors?
Depending on the size of the operation, there will be logistics issues. If you’re a smaller retailer and you’re trying to go from zero monitors to 3,000 tomorrow, it may seem easy on paper but it’s going to be a wholly different challenge out in the field.
Additionally, when we started, we had a lot of monitors installed, but our web portal and our [enterprise resource planning] platform were not connected. That was a huge challenge. We were creating tickets manually and then entering data into the platform.
All that to say, being intentional about your approach from the start is important and will save you from headaches down the road. You have to train yourself in addition to your customers and your employees on both the technology and the back-office platform.
Don’t underestimate the time it will take to do all the above. It’s worth every penny to spend the necessary time on it, too.
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