Maximize the return on your tank investment

Tanks may be the largest and most strategic investment on your balance sheet.

Their acquisition and maintenance costs represent millions in deployed capital. Tanks also anchor customer relationships and, when properly branded, define and visualize a marketer’s footprint in the market.

It should almost go without saying (but I’ll say it anyway!) that it’s important to fully leverage your software platform to manage, track and protect your installed tank base. Your team’s effective use of software transforms your tanks from a basic inventory item into a data-driven asset portfolio that supports profitability, safety and growth.

▶ It begins with basic tank data

Every tank should have a complete and accurate record in your software, capturing information that matches the data plate and installation details.

Fields such as manufacturer, year of manufacture, serial number, capacity and model allow for reliable tracking and compliance reporting. Just as important are ownership details – whether the tank is company-owned, customer-owned or leased – and its current location.

Your software should include more than the basic data. Maintenance records, inspection logs and service notes help to ensure regulatory compliance and operational readiness. This information should populate fields in your software that may be used to create actionable reports.

Some software packages also include value-added features such as location history that shows where each tank has been deployed over time. The ability to attach photographs or video images of installation, maintenance or removal aids in verification, insurance documentation and customer service. It’s worth noting that the visual images also ought to capture elements such as relative location on a customer’s property. This seems obvious, but we were more than a little embarrassed this summer when, in answer to a customer service inquiry about a tank’s location, our customer replied, “Well, you installed it; you ought to be telling me where the tank is.” Oops.

▶ Turn data into insight

With reliable data, your software’s reporting tools can deliver meaningful insight. Usage reports identify the tanks and locations that drive the most gallons and gross margin and may be used to prioritize maintenance and delivery planning.

Portfolio and revenue/rent reports illustrate how tanks contribute to profitability across customer types or regions. For example, like many retailers in Michigan, we have seen a significant increase in the usage of propane-powered electric generators. This is not surprising, as Michigan ranks second-worst in the number of large outages, eighth-worst for the annual duration of outages, second-worst for average outage duration and second-worst in time to restore.

The increase in generator usage has driven an increase in customers who want tanks dedicated to running their generators, even if they are unwilling to invest in purchasing the tanks themselves. This trend is giving rise to a significant tank rental market, suggesting profitability may be driven more by rent than by gross margin from usage.

Similarly, location analysis may support strategic decisions about service territories, while inventory management reports help ensure tanks are properly accounted for, maintained and not sitting idle when they could be earning – unless, of course, they are generating rental income. These reports enable and support proactive tank management and asset optimization – knowing not just what you own, but where it performs best and why.

▶ Data quality matters

Even the best reports are only as good as the data behind them. Tank information should be periodically, if not constantly, verified using both automated tools and human oversight.

Field employees, service technicians and delivery drivers can all help confirm location, condition and ownership data using both photographs and descriptions, as well as check boxes or fields on their tablets that are verified by your office team when the data is imported from the tablet or as part of a daily check-in process. Your software can also flag inconsistencies or missing fields for review. A disciplined approach ensures your reports – and your decisions – are based on accurate, current information.

Christopher Caywood until recently owned and operated Caywood Propane Gas Inc., which now is part of Crystal Flash Inc., a 100 percent employee-owned company. Contact him at chris@caywoodpropane.com.

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