Helping hands

Sometimes the best medicine for what ails you is a good chunk of time away and the broad shoulders of a caring friend to lean on.

Members of the Marketers’ Management Forum tour the grounds at E. Osterman Inc. in Whitinsville, Mass. The visit was held in conjunction with forum team meetings held last May in Providence, R.I.

Propane marketers are discovering that trusty remedy applies to more than personal struggles in today’s trying business climate. Those charged with managing their company’s success are finding solace and answers – if not hugs – from each other when the daily grind saps their energy and challenges their sanity.

For the past seven years, retail propane marketers from across the country have been gathering to exchange ideas, learn more about their business and help colleagues in a program called the Marketers’ Management Forum. The group operates as a business council of the National Propane Gas Association.

Three times a year, more than 60 participants gather for day-and-a-half sessions led by trained facilitators experienced in the propane industry. The group is divided into teams of 10-12 marketers, ensuring that no team members are competitors in the marketplace.

Team members decide what issues to tackle. Topics may include any aspect of business – personnel matters, marketing strategy, accounting principles, new technology, customer service tips, legal liabilities, unique competition challenges or bulk truck configuration. For legal reasons, pricing is the one topic that the marketers cannot discuss.

Team members contribute to a discussion about the most cost-effective ways for propane marketers to promote their businesses.

The idea is to identify and share the best practices so that every retailer doesn’t have to solve problems through individual trial and error.

“Benchmarking is a proven method for companies and industry groups to continuously improve the operations and competitiveness through analysis of relevant data and comparative best practices,” says Baron Glassgow, an NPGA staff member who doubles as program manager and one of five facilitators.

The original concept for the program was to establish industry standards as a point of reference for other marketers to measure the quality and value of their business. According to Glassgow, that role has expanded over time.

“A few years ago, the name was officially changed from the Benchmarking Council to the Marketers’ Management Forum. It reflected the reality that the discussion groups focus much more on management issues than crunching numbers and comparing ratios, although the benchmarking function is still an important part of each group,” he says.

Forum sessions are conducted according to a common code of conduct adopted by the American Productivity and Quality Center and the Strategic Planning Institute Council on Benchmarking. All discussions are confidential. Sessions often include an industry guest speaker and a visit to a local retail operation near the site of that meeting.

Vincent Osterman (center), president of E. Osterman Inc., describes his bobtail fleet equipment to propane marketers participating in the Market Managers’ Forum.

Membership dues are $800 per year per person and cover the workbook, facilitator fees and expenses, meeting costs (including a luncheon, reception and breaks) and administrative expense. Participants are responsible for their own travel and lodging.

What they say

The popular program has more than tripled in size since it was first offered as an educational seminar at NPGA’s Pinnacle conference in 1996. (It returns to the agenda at the 2004 Pinnacle, to be held June 14-16 in Naples, Fla.) Participants rave about the impact these sessions have had on their business outlook as well as their company’s bottom line.

“The forum has given me the knowledge to improve my business operations far more than any seminars or meetings ever could,” says Wayne Kohley of Excel Propane in Fruitport, Mich.

Frank Conley of Tiger Fuel Co. in Charlottsville, Va. agrees. “The biggest value I get is I come back to the office energized after a forum meeting. I have a notebook full of new ideas and the benefit of 12 industry ‘experts’ willing to comment on any part of the business that I put on the table for discussion. “

“We discover how other people are solving day-to-day problems we face in operating our business,” adds Jeff Kerns of Thompson’s Gas and Electric in Boonsboro, Md. “The group virtually becomes and advisory board to consult with regarding operational issues.”

Propane managers not only find solutions to their business problems, they also learn about potential problems they may have not yet encountered.

“As a forum member, you get the opportunity to discuss your business ideas and plans with other business leaders that have already confronted and tackled the same issues,” observes Frank Hicks of Hughes Propane in Pinehurst, Texas.

“The forum has enabled me to look at the problems and challenges I have experienced with the help of my peers,” says David Gable of Hocon Gas in South Norwalk, Conn. “There is no other industry-specific venue that can afford me this kind of luxury without concern that the information I reveal can be used competitively against my company. The forum allows the large and small marketer to see how others have addressed similar issues and what solutions other minds have developed.”

Show me the money

Glassgow knows that propane managers need more than good conversation and ideas to justify their investment in the forum. Tangible benefits to the bottom line back home are the true test of the program’s success and keep many participants coming back.

Testimonials from marketers who say they see those results are not hard to find.

Ken Green of Oklahoma Liquefied Gas in Seminole, Okla. says forum input has enabled his operation to streamline its fleet of bobtails from 22 to 15 while selling the same volume of gas.

“The ideas (from the forum) have added profits to the bottom line,” he confirms.

At Collett Propane in Xenia, Ohio, Jane Newton was used to tapping into her company’s line of credit each January. Not any more.

“Since I decided to offer my customers pre-buy gas, an idea I got from my benchmarking group, I have not once gotten into our line,” she says proudly. “Our receivables are very manageable now. I have been able to use our customer’s money rather than the bank’s money. I am able to go to our banker for funds for equipment purchases rather than money for daily operations.”

Tim Johnson of Propane Plus in Rehoboth, Mass. says attending his first benchmarking meeting added $30,000 to his bottom line at the end of that year.

My first meeting I profited greatly from the ideas and methods exchanged, financially and professionally,” he says.

Do I belong?

As team members gathered around a table last May in Providence, R.I., they broke the ice with anecdotes about fire and bark beetle infestation in the far West and tornados overturning customer tanks in Tennessee.

Marketers introduced themselves by giving a synopsis of their backgrounds. One young man – a 1996 college graduate attending his first meeting – is third generation in his family’s 75-year-old Virginia retail business. Another first-time attendee runs a tiny, fledgling operation in Tennessee after years in tank sales. Managers from two companies – one in Ohio, the other in Maryland – were celebrating 50 years in the business. A New York marketer was representing the nation’s 21st largest propane retailer.

The fact is, participants come from all parts of the nation and represent a vast array of customer demographics, size, competitive challenges and market niches.

Sometimes the discussion focuses on a specific problem. How do you fix an accounts receivable scenario where 75 percent of customers are more than 90 days late in paying? What is the most effective way to calculate operating expenses? How do you handle an employee you suspect is using drugs? Is now the right time to open that new branch office?

Other times it’s a give-and-take flow of ideas on more general topics. How much gas should be pre-bought this summer? How much do colleagues spend on advertising? What incentives can be offered for your best customers? Cell phones or radios for drivers? Should companies reward employee longevity? What is the best management software on the market?

Teammates also share operational data from their companies to see how they compare with each other, and how the group average compares with industry norms.

The discussion blossoms as the dialogue drills down through each team member. The conversation is pointed and frank. After listening to others, participants often discover there is plenty of room for improvement in their business.

“I have learned to work smarter. There are things that I never would have done when I started with this group, but now I do,” admits Vincent Osterman of E. Osterman Inc. in Whitinsville, Mass.

“What the Marketers Forum has done is give me access to dynamic and creative owners and/or top level managers in the propane industry. We have bounced thoughts and ideas and created successful programs that has had a positive impact on how we operate our business,” says John Armentano of Paraco Gas, Purchase, N.Y.

As marketers return home and convert ideas into practice, teammates often follow-up with additional questions as ideas are implemented. The professional contacts lead to personal friendships that become as valued as the business insight.

“You not only educate yourself for your company, you gain immeasurable contacts with all the other participants for a lifetime,” explains Tim Jones of Hancock Gas Services in Findlay, Ohio.

“The ideas that are exchanged and the friendships that are fostered through the forum are priceless. You are able to tap into a group of individuals who have so many resources that some of us don’t have and never could afford. It raises the level that we all work at, making the industry better as a whole,” adds Johnson.

For Mike Shilts of Pennington Gas Service in Morenci, Mich., the forum is educational, challenging and fun.

“The best part of being in the forum is the free exchange of ideas and camaraderie among the group members to brainstorm and solve problems in a friendly environment. The ability to meet with other marketers across the country to discuss just about every aspect of your company is extremely valuable and just about impossible to get any other way,” he says.

“Our sessions are always fun, but we also work very hard. We always have way too many topics to discuss for the time allowed. We get together for a group dinner on Friday night and sometimes other activities on Saturday with our spouses and relatives.”

Anyone interested in joining the forum can find more information on NPGA’s website (www.npga.org – About NPGA) or contact Glassgow at bglassgow@npga.org or 866-881-6309.