Smart Business

Chapter 4. Save Fuel with IoT

Small ventures rely on electricity in a wide variety of ways, but for many, it’s not the only thing powering their business. A lot of companies with 500 or fewer employees rely on transportation or delivery for their operations. Think of couriers, shuttle services, brewing companies, furniture stores, florists, landscapers, painters, plumbers, electricians, and towing firms. What do they have in common? Each depends on company-owned vehicles to get the job done. It could be a single car, truck, or delivery van, or even a small fleet. Regardless of the type, almost all of those vehicles are being fueled by gasoline or diesel. With an average price of just over $2.30 per gallon for both fuel types when this report was written, small businesses can generate significant savings by becoming more fuel efficient.

A report published by the Environmental Defense Fund and PHH Arval does a wonderful job of sizing up this opportunity. It states, “Medium-duty trucks, identified as Classes 3–6, are the workhorses of the American economy. These vehicles deliver food and beverages to restaurants and convenience stores, drop off packages at homes and offices, serve as mobile workshops for all types of technicians, and perform thousands of other daily tasks. They also use a lot of fuel—over 8 billion gallons a year.” That’s an annual cost of $18.4 billion dollars at the aforementioned price. The report goes on to say that medium-duty trucks emit more than 13 metric tons of carbon dioxide per vehicle per year on average. To put that in perspective, it would take more than 12 acres of US forests just to absorb the emissions from one truck for one year. So, being fuel efficient can also reduce stress on the environment.

The good news is that any business can take some simple steps to conserve fuel, retaining cash and reducing greenhouse gas emissions in the process. Following are several areas where you can take action:

Out-of-route miles

Shorter trips save your business time and money. That’s why it pays to avoid excess miles when possible. Using GPS technology is an easy way to optimize routes. The Carbon War Room notes that it’s especially advantageous for intracity trucking, reducing mileage by 5–10 percent. Businesses can also benefit from knowing where field personnel are relative to the next job that needs to be serviced. Ideally, the closest individual who’s best-suited for the occasion would always be sent. Using GPS-powered, location-based solutions can optimize dispatching and reduce vehicle miles as well.

Idling

Argonne National Laboratory studied commercial trucks and found that all sizes idle for extended periods (30 minutes or more) during workdays. Often, it happens as their drivers are waiting to pick up or drop off a load. For instance, a basic enclosed van that drives under 40,000 miles annually averages 600 workday idling hours per year. That wastes an average of 381 gallons of gas per year. Knowing when idling occurs and setting company policies to restrict how long it happens can save money and lower your environment impact.

Speeding

The fuel efficiency of vehicles differs by make and model, but one thing is certain. As soon as you go beyond 50 miles per hour (mph), you get fewer miles per gallon (mpg). Oak Ridge National Laboratory studied increasing highway speed and its effect on fuel economy. Based on a test of 74 light-duty vehicles, mpg decreased by 12.4 percent from 50 to 60 mph, 14.0 percent from 60 to 70 mph, and 15.4 percent from 70 to 80 mph. Moderating speed can improve your triple bottom line, while reducing risk for your driver and vehicle.

Aggressive driving

Speeding, rapid acceleration, and forceful braking are hard on your vehicle and waste gas. According to FuelEconomy.gov, this can lower your gas mileage by 33 percent at highway speeds and 5 percent around town. Driving sensibly reduces vehicle operating costs and GHG emissions. It’s also safer for the driver and everyone else on the road.

Tire pressure

When tires are low on air, they spread out under the vehicle’s weight and create more rolling pressure. It can reduce gas mileage by 0.3 percent for every 1 pound-per-square-inch drop in pressure of all four tires according to FuelEconomy.gov. Improve your mpg and lower fuel emissions by up to 3.3 percent by keeping your vehicle’s tires inflated to the proper pressure.

Engine maintenance

Does the system under your hood need attention? FuelEconomy.gov points to engine maintenance as another opportunity to increase mileage. Repairing a car that is out of tune or has failed an emissions test can improve its mpg by an average of 4 percent. Fixing a faulty oxygen sensor can improve mileage by up to 40 percent. Stay on top of preventive maintenance to reduce visits to the pump and fuel-related air pollution.

What If Your Fleet Manager Had ESP?

These actions are easy to take when it’s just you behind the wheel. But it becomes more challenging when your business has multiple vehicles and you rely on others to do the driving. Typically, it’s hard to know how a vehicle is being driven unless you’re riding along in the passenger seat. It’s also challenging to know what mechanical issues may be undercutting your vehicle’s performance at any given time. It’s not as if the company truck or delivery van can schedule a one-on-one meeting with you once a week to provide a status update. That’s when ESP, or extrasensory perception, would come in handy. Without being there, you could instantly know what was happening and address it. Though few, if any, of us have this power, IoT-based solutions can give everyone these superhuman insights.

Just as Internet-enabled solutions can imbue a building with sensory intelligence, telematics can do the same for vehicles. Telematics devices relay data generated by computerized systems or sensors over long distances. They tend to rely on signals provided by wireless carriers, instead of WiFi, making them ideal for cars, trucks, and vans that are constantly on the move. There are two types of telematics solutions that can benefit your business, especially if you own and operate a small fleet and have several employees in the field providing deliveries or on-site service to a set of customers that changes by the day. Both can reduce fuel costs and vehicle emissions. The first is a fleet management solution, such as FleetLocate, as represented in Figure 4-1. The second is a mobile workforce management solution, such as StreetSmart Workforce.

Figure 4-1. Dashboard for Spireon’s FleetLocate

FleetLocate from Spireon is a solution that can track of all the vehicles in your fleet, monitor their health, and gauge how they are being driven. The solution consists of two components: 1) a telematics device, equipped with a wireless data plan, that is installed in each vehicle, and 2) a cloud-based system, Spireon Fleet Mangement, that receives and analyzes real-time data from your vehicles and can be viewed through a web dashboard.

The FleetLocate telematics device, the FL7, is a bit smaller than a pack of playing cards. It has built-in GPS technology that can track the vehicle’s location and an accelerometer that can sense how much gravitational force the vehicle encounters while it’s in motion. It also contains tracking algorithms that can retrace trips and analyze incidents, and even features an audible buzzer that can provide the driver with feedback on harsh braking, harsh acceleration, harsh corners, over-revving, excessive idling, speeding, and seatbelt violations.

The FL7 plugs into the vehicle’s on-board diagnostic (OBD II) port. Think of this as the gateway to the engine’s computer system. The OBD II comes standard in most vehicles built for the US market since 1996. It’s always positioned within three feet of the steering wheel and can usually be found under the dash on the driver’s side. This port is where your mechanic will connect the repair shop’s digital equipment to diagnose issues with the engine’s performance. Once the FL7 has been plugged in, you also have access to all of that data and more.

Spireon offers a mid-tier service that has most of the features a small business likely needs. Each FL7 you purchase under the plan comes with a one-time activation fee of less than $100 and a recurring monthly fee of about $40, which includes connectivity for wireless data. With this plan you can monitor, analyze, and generate reports on the following features by logging into the Spireon Fleet Management web portal:

Location-based

Tracking, breadcrumb trails, stops, various map views, and alerts on unauthorized movement and when vehicles enter designated areas

Diagnostics

Tire pressure, idling, fuel usage, miles, CO2 emissions, predictive maintenance, engine diagnostic codes, and notification on vehicle safety and roadside breakdowns

Behind the wheel

Driver identification, hard breaking and hard acceleration, coasting, swerving, speed compared to posted limits, and driver safety scoring

Spireon customers have experienced up to a 50 percent reduction in accidents by helping drivers identify and reduce risky behaviors. They also have saved money and vehicle emissions by reducing their fuel purchases and idle time as much as 15 percent and 50 percent, respectively. With those results, it’s easy to see how a fleet management solution like Spireon can pay for itself.

The other type of telematics product to consider for your small business is a mobile workforce solution. If you have a team of people in the field who regularly drive to clients to provide service or transport goods for your company, you know that it’s essential to optimize logistics. The more quickly you can get the right personnel to the right job, the more revenue-generating services you can squeeze into the day. Likewise, the more swiftly and efficiently you can get products to your customer’s doorsteps, the more deliveries there are during the day over which your business can spread fixed costs, and the lower variable costs (like fuel) can be per delivery. However, to pull this off, it’s essential to know where the members of your field team are at any give time relative to the next assignment. That’s where a mobile workforce package, like StreetSmart from Xora (represented in Figure 4-2), can come in handy.

Figure 4-2. Dashboard for Xora’s StreetSmart Workforce

StreetSmart Workforce is a telematics solution that uses the smartphone or tablet your team members already carry as the IoT device, rather than an ancillary device or sensor. Since this handheld wireless communication equipment already has GPS tracking built into it, along with a range of other features that can be leveraged for delivering a better customer experience, it’s an easy way to get even more out of an existing investment.

StreetSmart Workforce can be licensed for a little more than a dollar a day per user. That amount covers a mobile app that can be downloaded and installed on each field employee’s hand-held device. It also includes access to the cloud-based platform that receives and analyzes data from each of those devices. Your field dispatcher can access this control center and manage operations through its web-based portal. Back-office integration for bookkeeping and reporting is also available.

With this solution, you can view where your mobile workers and jobs are located at any time, as well as optimal driving routes, all on Google Maps. You can also see who’s on shift, when they entered or left or a location, how soon they’ll arrive at the next assignment, and how many hours they’ve worked this week.  Having all of this information at your fingertips helps you make better field dispatch decisions.

Xora has found that this additional business intelligence has enabled most customers to reduce fuel and mileage expenses by up to 15 percent, and overtime by 25 percent or more per mobile employee. Interested in seeing what this might mean for your business? Check out Xora’s savings calculator online.