Global Positioning Systems Aren’t Just For Tracking

August 23, 2002
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Tim Turner is one of many service technicians at Flame Furnace Co., Warren, MI, who rides along with a Global Positioning System. Flame uses the @Road system.
Many miles above the earth, a satellite is getting signals from a device affixed to a service vehicle; in turn, the satellite is providing driving directions, geographic locations, plotting vehicle usage, and retrieving all kinds of customer information. Well, maybe not the last item — not yet.

How does this new technology affect HVACR contractors and what can they expect down the road from systems using this same technology? That’s what The News set out to discover when we asked several Global Positioning System (GPS) manufacturers about GPS product technology of today and tomorrow.

Mark Campagna of FleetBoss Global Positioning Solutions, Inc., Orlando, FL, explained GPS.

“The GPS network includes multiple satellites orbiting the earth at a distance of approximately 12,000 miles,” he said. “The satellites provide detailed positioning information, generally using a four-satellite system — three satellites to triangulate a position and one to measure altitude.

“The GPS network was developed in the 1970s by the U.S. military and was declassified in 1982 for commercial use. The system is accurate to within 30 feet. However, for security reasons, a built-in error code randomly limits GPS accuracy to within 100 feet.”

The vehicle unit, GPS antenna, and radio antenna transmit data to a secured Web server. (Courtesy of GPS North America.)

GPS FOR HVAC

First of all, what is it about GPS that makes it so important to HVACR contractors?

“GPS systems touch many more aspects of a business than you’d think,” said Todd Lewis of GPS North America, Southhampton, PA. “Most of your readers think they are in the HVAC business. What they don’t often realize is that they are also indirectly in the trucking business.

“Picture a 25% savings on your fuel bill, reduced maintenance costs on your entire fleet by 30%, an increase in the number of jobs you can do in the same period of time in a given day or in a week, reduced unnecessary overtime, and cut your insurance premiums — all at the same time.

Vehicular units such as this one relay positioning data by satellite. (Courtesy of Discrete Wireless.)
“Any one of these things would have a substantial impact on a company’s bottom line,” he said. “Add it all together and any service company would be crazy not to have a system in place.”

R. Wayne Johnson of Discrete Wireless Inc., Atlanta, GA, named some of the reasons why HVACR contractors need GPS.

“One of the most difficult customer-relation issues has been the acquisition fee time charge, which is basically the time between the first on-site assessment of a mechanical problem, the time the service tech takes to find the correct parts, and the time the vehicle returns to the jobsite,” he said.

“While the drive and pickup time is certainly billable, some HVAC customers dispute the amount of time for which they were billed. In addition, service technicians feel more comfortable presenting these charges to their customers because the potential for dispute is removed.”

Tim VanCleve, vice president of sales and marketing for Teletrac, Garden Grove, CA, stated, “With the implementation of a GPS system, the owner is able to determine how long the service calls are taking, which should then, in turn, enable him/her to plan more effectively. This leads to more time for the technicians in the field to concentrate on what they do best: servicing the customer.

This radio module is mounted in the vehicle. (Courtesy of GPS North America.)

“In a conventional HVAC setting, the technician is continually having to call in, check in, clock in, clock out, etc. Most technicians find this frustrating and toilsome. However, the HVAC contractor with a GPS system has all of these procedures automated and documented — thus providing a higher level of service to the customer, and a higher level of efficiency to the organization.”

John Gaither, executive vice president for Tripmaster Corp., Kernersville, NC, gave some more specifics: “proper use of vehicle speed and RPM, unnecessary engine idling, accident recording, accurate departure and arrival times, waiting times, stop times at jobs, delay verifications, ‘panic’ braking, switches for verification of power-take-off operation, door opening at the right place and time, to name a few.”

Melissa Berg Baker, public relations manager of Minorplanet USA, Richardson, TX, gave a detailed list of reasons why HVACR contractors would benefit from a GPS system.

“An HVACR contractor with a GPS system that tracks vehicles minute-by-minute will have:

  • “Immediate visibility to the exact location of their vehicles; street-level mapping allows HVACR contractors to find the exact location of a vehicle in real time, especially useful in customer or company emergencies.

  • “Increased productivity due to greater visibility of vehicle/ employee behavior and location; typically, HVACR contractors are able to add an extra job per day because they can now view the closest vehicle to a job, route deviations, and better route paths, as well as travel to a prohibited location or personal use of vehicles.

  • “Reduced fuel bills; one Minorplanet customer saw that his trucks were idling three hours daily, wasting fuel and money. His trucks now idle less than an hour every day, realizing savings of more than $30,000 annually.” (See "GPS Case Study" sidebar below.)

  • “Reduced payroll expenses; HVACR contractors can see exactly how long a vehicle/ employee was at a job. It confirms manual timesheets and reduces timesheet mistakes.”

    The Fleet Director Enterprise Edition locates and tracks the position of vehicles on a detailed map that also displays addresses in a data window. (Courtesy of Teletrac.)

    AT WHAT COST?

    It is easy to see the benefits of having a GPS, but at what cost to HVACR contractors? What will be the payback period?

    Johnson offered some numbers. “Typically, GPS systems cost anywhere from $400 to $800 for hardware and installation. Real-time fleet management systems have recurring airtime charges ranging from $19.95 to $79.95 a month. With GPS technology, business owners are able to recoup their investments in an average time of six to nine months.

    “The return on investment comes in the form of the ability to track billable hours, the reduction of unauthorized service calls, and increased customer service by proving proof of service,” Johnson said.

    Baker discussed payback. “A quality fleet management system should pay for itself almost immediately. We’ve found that typical payback is five fold. The price of our system depends on the number of vehicles and the configuration required by the customer,” she said. “However, GPS typically costs $4 per day per vehicle.”

    “Our average of complete 100% return on investment is between three to six months,” said Lewis. “That represents a tremendous value for your dollar. A good, reliable system runs between $600 to $1,200 per vehicle, depending on a company’s needs.”

    VanCleve said a GPS shouldn’t cost HVACR contractors anything. “A contractor should never expect to pay anything for a GPS system,” he said. “The proven, reliable systems are readily available at a fraction of a contractor’s operating expenses.

    “By utilizing GPS to minimize these expenses, the systems are, for practical purposes, free of charge. A good rule of thumb in the industry is one manhour per month; [that] will always offset the cost of a GPS. The return on investment is typically within the first six months of implementation.”

    Units such as this one relay positioning data by satellite. (Courtesy of FleetBoss.)
    J.D. Fay, vice president of corporate affairs for @Road, Fremont, CA, stated, “The @Road service costs about $50 per subscriber per month. The basic hardware has a one-time fee of between $490 to $590, depending on volumes.

    “Based upon our customer feedback, customers are able to increase the number of jobs per worker per week by one and decrease the overtime per worker per day by about 10 to 20 minutes. Improvements in either metric typically yields a 100% ROI in between two to 10 days. Moreover, the decrease in back-office administrative time also provides a 100% ROI within about two to three weeks, depending on the customer.

    “Of course, savvy customers extract all three types of value from the @Road service to maximize their investment.”

    Minorplanet's data collection unit is mounted in the vehicle. (Courtesy of Minorplanet USA.)

    THE FUTURE OF GPS

    “The future for the GPS market is wide open,” said VanCleve. “The wireless data sector continues to advance at a blinding pace. With that will come products like bar code scanners, credit card swipes, signature capture, and many more.

    “Additionally, we expect so see the leaders of the GPS market specializing in back-end software integration. The leader in the industry will be able to automate payroll, facilitate existing dispatch/routing applications, etc.

    “The stand-alone GPS provider will be a thing of the past within the next few years,” he predicted.

    Baker stated that “The largest growth potential for GPS technologies will come from the integration of GPS services into handheld devices. Handheld devices such as cell phones, personal digital assistants (PDAs), and tablet PCs will incorporate GPS technologies to be used by sales and service people — transmitting and receiving vital customer information immediately to business enterprise systems.

    “Wireless data with GPS technologies will enable a host of location-based services, geo-fencing technologies, and alert-based services,” she said. “Of course, basic tracking and management of devices and inventories will also be maintained.”

    Fay concluded, “In the future, we’ll see feature-rich devices widely deployed to mobile workers, which are connected to the corporate Intranet and Internet. These devices exist today; however, they are mostly targeted to corporate workers and the systems themselves operate too slowly to be effective.

    “With the deployment of wireless networks and companies developing targeted applications for vertical markets such as HVACR, widespread adoption is on the horizon.”

    For a complete listing of websites for GPS companies mentioned in this article, see "Manufacturers List GPS Products" sidebar below.

    Sidebar: GPS Case Study

    DALLAS, TX — Wilson Heating & Air Inc. (www.wilsonsvc.com) is a family-run business that provides sales, installation, and maintenance services for residential and commercial air conditioning and heating systems throughout Dallas and the surrounding north-Texas area.

    The contractor wanted to control the use of personal mileage and, therefore, unnecessary fuel and maintenance costs.

    In addition, the ability to control and monitor all aspects of the fleet was important to maximize productivity and reduce payroll expenses. The company chose the Vehicle Management Information (VMI), manufactured by Minorplanet USA, Richardson, TX.

    THE RESULTS
    Steve Wilson, owner, listed the following results:

    Productivity — “The workforce and our operations are both now much more efficient, and since installing the system, we’re generating an additional $300,000 of annual revenue.”

    Payroll — “We check the drivers’ timecards against the system weekly and we’re spending 10% less on payroll. This amounts to more than $90,000 of savings per year, which is just phenomenal!”

    Fuel — “Through a combination of eliminating unauthorized personal mileage and by more effectively dispatching our jobs, we’re saving over $30,000 a year on fuel and running costs. The gas savings alone will pay for the system.”

    Fleet maintenance — “Total weekly mileage has been reduced by 1,800 miles, which means we’re saving around $15,000 a year on vehicle maintenance costs.”

    Security — “With more than $300,000 invested in our fleet, and even more in tools and materials, we’ve seen a significant reduction in shrinkage that translates to annual savings of around $40,000.”

    Driver benefits — “The savings we’ve made have enabled us to fund our employee profit-sharing program at a 10% higher rate than previous years. These dollars go tax-free straight into our employees’ pockets.”

    Bottom line: a $300,000 increase in revenue and additional savings of at least $175,000.

    Sidebar: Manufacturers List GPS Products

    The manufacturers quoted in the GPS feature above have a variety of products available for HVACR contractors. This sidebar contains a brief list and product descriptions. Since some companies sell additional products, The News advises that you visit their websites for more information.

    @Road (www.@road.com)
    The company offers three services: RoadReport, an entry-level service for historical data only; FleetASAP, the flagship service used by more than 70,000 subscribers in North America; and RoadForce, a mobile resource management (MRM) service for managing mobile sales professionals.

    The hardware used to capture data in the field, a small black box, is manufactured by @Road in connection with its partners. The user interface devices offered by @Road (for messaging, forms, proof of delivery) are manufactured by @Road’s partners, such as Symbol Technologies.

    Discrete Wireless (www.discretewireless.com)
    The company’s solution is Marcus™, a state-of-the-art vehicle tracking system and the first set of solutions in the company’s planned Marcus suite of intelligent wireless data solutions. Marcus was introduced to the commercial fleet vehicle market in December 2000 in a beta version. In June 2001, following the completion of beta testing, Marcus was released to the market as a commercial product.

    The product integrates the Marcus radio module in-vehicle hardware component, GPS, the Cingularsm Wireless data network, the Internet and the company’s proprietary network gateway, the Discrete Wireless™. By using the Marcus service, customers have the ability to efficiently manage their fleet vehicles by receiving location-relevant, time-sensitive information through the encrypted, password-protected website.

    FleetBoss Global Positioning Solutions, Inc. (www.fleetboss.com)
    The Boss® fleet management system combines GPS-based tracking data and proprietary software to deliver an informative, cost-effective way to monitor drivers’ efficiency and productivity. The systems provide managers with key vehicle data such as start and stop times, number of stops by address per day, mileage, maximum speed, idle times, routes traveled, and more.

    The systems can also be customized to monitor service equipment usage. For example, a carpet-cleaning company can use The Boss® to track the number of times per day the cleaning equipment is turned on or off; the amount of time the equipment is used at each stop, etc.

    A small antenna on each vehicle links it to the GPS system, which can then monitor each vehicle’s activity 24/7/365. The data is easily downloaded into the user’s master database, providing a permanent history of the entire fleet operation.

    GPS North America (www.gpstracking.us)
    The company sells its own brand of vehicle tracking and reporting services. A small GPS radio module is mounted in the vehicle. The recorded information is then transmitted over a data network called Mobitex to a secure Web server. Clients then log onto the website, enter a user name and password, and can access all information from any computer in the world where there is Internet access. The vehicle never needs to return to a centralized office for the company to get the data.

    Minorplanet USA (www.minorplanetusa.com)
    The company makes the Vehicle Management Information (VMI). It offers:

  • GPS-based with minute-by-minute tracking;

  • Clear and concise vehicle and labor cost inputs and analyses;

  • More than 30 comprehensive, proprietary reports that leverage the above points; and

  • PC-based operation.

    VMI’s benefits include:

  • Increased productivity;

  • Reduced fuel costs;

  • Decreased payroll expenses; and

  • Improved customer service.

    Teletrac (www.teletrac.net)
    The Fleet Director Enterprise Edition service locates and tracks the position of vehicles via Teletrac’s authorized networks and relays this information to a dispatcher with the click of a mouse for more efficient fleet management. Vehicles will show on a detailed map with their addresses clearly displayed in the data window.

    Users can navigate easily between map views by clicking a tab. Or, they can zoom out to see several adjacent areas all at once.

    The company also offers a choice of metropolitan or regional coverage, so dispatchers can visually travel along with the vehicles, wherever they go.

    Tripmaster Corp. (www.tripmaster.com)
    Tripmaster OBC’s new TKO Series is targeted at a number of markets, including those of HVACR contractors “who value the active management of their mobile assets,” the company says.

    Publication date: 08/26/2002

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