Tuesday, March 13, 2012

Rising fuel prices don't have have to raise your blood pressure

Fred Haskett

Fred's Take

As I was sitting in our Friday Staff meeting the past few weeks I realized the discussions while seemingly normal for the time of year – Spring Start-Up Operations – were all happening several weeks earlier than normal. Due to the current reality of 2012 we are facing some different challenges this year, and some normal ones that are more exacerbated than normal.

Nationwide we have had a very mild winter St. Louis where I operate is no different.

The spring of 2012 promises to present us with several challenges:

  • Rising fuel costs
  • Low cash flow due to lack of snow / or if you are not in a snow region lack of cash flow due to no real seasonal slow-down this winter.
  • Horticultural challenges

What is the true impact of rising fuel costs?
  • Emotional – You are writing a much larger check for your fuel costs than you were a year ago.
  • Practical – Fuel has risen 33%. And is still rising.
  • The Geo Political and Domestic Political situation is such that our leaders appear poised to do what they do best  - NOTHING!!

So how do we deal with it? Let me share with you some of the things that we are brainstorming about.

We have talked about several practical ways to address this situation.
  • Verify all vehicles and equipment are properly tuned and maintained.
  • Assign trucks with the best fuel mileage to the longest routes
  • Check tire inflations daily
  • Assign newer equipment that burns fuel more efficiently to large jobs
  • Lighten the load on the truck by not carrying extra/unused equipment
  • Use GPS tracking to monitor speeds, idling time, and unnecessary travel
  • Work 10-hr days when practical
  • When you have time ask your elected officials to do their job.

Another key is to speak with your customers about changes to their program to help offset rising fuel costs that are outside of your control. Do not act without talking to your customer.

Do NOT assess fuel charges to your invoice. 
Your customer works with set budgets and raising your price may force them to take bids.  If you do opt to use fuel charges, do not add them to your invoice without speaking to your customer first.  Remember, their business is also being impacted somehow by rising fuel costs.

Do NOT send out a form letter announcing your intentions to adjust service levels or add fuel surcharges.
Any action should be discussed with your customer one on one.

Many of us either did not produce the anticipated snow revenue this winter or in the year round markets you experienced a warmer than normal winter and were not able to reduce service intervals as significantly as you usually do.  In either case, you possibly have not been able to save enough cash to fund spring operations.

What are our options?
  • Sell enhancements and request down payments to ease cash flow requirements
  • Offer a discount for early payment to spur cash flow
  • Discuss an adjustment to payment terms from your supplier
  • Take advantage of trade credit and Early Order terms
  • Begin and complete spring clean-ups and mulching operations early to reduce overtime when the season starts
  • Investigate lines of credit BEFORE you need it
  • Reduce overheads where possible

Horticultural Challenges
Spring has definitely come early to most of the country.  Agronomic applications such as pre & post emergent weed control are driven by soil temperatures, not by a calendar or air temperatures.

Do you know the history of soil temperatures in your market?
Are you monitoring soil temperatures in your area to stay on top of the situation?
Are you checking in with your extension service to get their thoughts and advice of the current reality.

Be sure you understand your customers’ expectations
·       Are you on a performance based specification?
You may have to start servicing early.
·       Is the service period clearly defined?
Can you start servicing early?
·       If your customer is on set frequencies or pre-determined season start dates, is there an opportunity for additional income for extra services?

*  Insect activity will also be high this year. In most markets, cold weather reduces spring and summer insects.  The same is true for most weeds as well.

*  In markets that did not receive normal snowfall – drought conditions can also be expected.

So the best message I can leave you with and what we are doing is:

* Be aware of the current reality!

* Make sure you are dealing with the current reality!!

* Communicate with your customers and be prepared for an early start!!!

Kohler donates more than 10,000 engines to high schools and technical colleges nationwide

   I must admit when I was in high school I had no interest in taking "shop" class. Oh, how foolish I was. The kids that took shop were "hoods" as we used to call them. Well now I pay those people I looked down my nose at a fair amount of money to fix my ever more complex car. 
   My attitude was wrong on so many levels, not the least of which, was that I though I was better than those kids. While I barely gave them a second thought many years ago, the people who can fix my car are extremely important in my life, now.  
   And it is with that new found appreciation that I applaud the donation Kohler has made to help ensure there will be plenty of well-trained technicians to fix the machines we rely on daily. Below is the press release from Kohler that details their gift. Bravo Kohler.

KOHLER, Wis. – In an effort to ignite a renewed appreciation and understanding of small engines among high school and technical college students nationwide, Kohler® Engines recently donated more than 10,000 engines to hundreds of educational institutions across the country. The company partnered with several non-profit organizations on the one-time gift, that worked independently to distribute the engines to interested schools. All of the donated engines have been delivered to numerous schools from New York to California and almost every state in between.

“This has been a very rewarding process,” said Justin Blount, director of marketing for Kohler Engines.  “We’ve been touched by the level of response this donation has received from students, facility and administrators at all of the participating schools. We’ve received countless emails, letters and photos from the people who directly benefited from this donation – and those have certainly been appreciated by everyone here at Kohler.”

The organizations that helped distribute the donated engines on Kohler’s behalf, include: SkillsUSA, a non-profit partnership of students, teachers and companies working together to ensure America has a skilled workforce; the Equipment and Engine Training Counsel (EETC), a non-profit association whose goal is to address the shortage of qualified service technicians in the outdoor power equipment industry; Fox Valley Technical College Foundation, in Appleton, Wis.; and Hinds Community College Foundation in Jackson, Miss. Each of these organizations distributed the engines only to schools who agreed to utilize the donated product exclusively for educational purposes. Individual classrooms within the participating schools were eligible to receive up to 24 engines each.

The products donated by Kohler were Courage® XT 7 hp vertical-shaft engines, which are typically utilized in equipment such as walk-behind lawn mowers and pressure washers. Students with access to the donated engines are now able to gain critical hands-on experience, while also enhancing their knowledge of a variety of engine-related topics, including assembly and disassembly, components, torque values, engineering processes, the general functioning of internal combustion engines, and more.

“As a leading engine manufacturer, we’re very interested in working with future generations of technicians and consumers to make sure they understand the craftsmanship and attention to detail that goes into each engine bearing the Kohler name,” Blount continued. “This recent donation presented an ideal opportunity to connect directly with students across the country while also aiding the administrators and faculty who play such a critical role in shaping the leaders of tomorrow with needed equipment.”

About Kohler Co.
Founded in 1873 and headquartered in Kohler, Wis., Kohler Co. is one of America’s oldest and largest privately held companies. KOHLER is a global leader in the manufacture of kitchen and bath products, engines and power generation systems, cabinetry, tile and home interiors, and an international host to award-winning hospitality and world-class golf destinations.

Wednesday, March 07, 2012

Machines of Glory

       Put a pair of contractors in a couple of machines and your going to have two things — a business (or at least potential for one) and more importantly (at least from the perspective of the employees) a competition.
       Go to just about any equipment show and you'll find an equipment rodeo that pits operator against operator in a skills competition. Many operators are incredibly talented and need a venue to showcase their skills.

      So, it's not surprising (especially with the proliferation of reality shows) that television gurus have found a way to turn these competitions into entertaining television. "Machines of Glory," which features equipment provided by Caterpillar, is expected to air toward the end of the month (check your local listings) on the Discovery Channel.

     The new program, hosted by ABC's "Extreme Makeover: Home Edition's," Johnny Littlefield, the show takes three teams of three and puts them through their paces competing against one another in a series of "outrageous challenges that put their skills to the test in three areas of ability — speed, skill and power — while operating massive machines including powerful excavators, speedy backhoes, agile skid steers, massive wheel loaders and nimble dozers." And those machines were donated by the good folks at Caterpillar.

Below are a few images from the first few episodes.