Convenience Store IoT - Leveraging the Tech You Already Have
By Tim Tang (Hughes) based on an interview with Titan Cloud Director of Product Management, Clay Moore
The Internet of Things (IoT) has enormous potential to transform modern business with the innovations that are developing every day. For the convenience store industry, one IoT opportunity involves technology that has been deployed for decades: the Automatic Tank Gauge (ATG). Routinely used by almost all modern businesses that store or depend on the distribution of fuel, the ATG is an electronic version of the dipstick that is dropped into an underground tank to assess fuel levels.
Beyond tracking fuel inventories, the ATG--with its direct telemetry with installed probes and sensors across the forecourt--holds tremendous potential for improving customer experience, increasing operational efficiencies, and protecting the business against compliance risks.
Common ATG Challenges: Misconfiguration
To fully realize the business potential in the ATG, the first place to start is by resolving common configuration problems. Improperly configured ATGs overwhelm store operators with unnecessary alarms. This not only distracts them from their daily responsibilities, it also trains them to ignore these incessant alerts—like the boy who cried wolf—which can be dangerous in those instances when the system is alarming on critical issues, such as fuel leaks or overfill events, in which the ATG may be warning the operator that the tank has been overfilled and fuel is literally spilling out of the exhaust vents. However, because of frequent false or trivial alarms, the store clerk often learns to ignore this box in the backroom that beeps periodically throughout the week. The danger is that in those few instances when the alarm is valid and critical, spilled or leaked fuel not only represents wasted inventories that should have been sold; it also causes costly regulatory fines and clean ups that a year of margins may be unable to make up. A far better practice is to learn to manage the ATG’s parameters properly to ensure these alerts represent true positives and to couple that with the right software tools to help guide the appropriate response.
In addition to the nuisance of unnecessary alarms, misconfigured ATGs can also unnecessarily shut down all the dispensers at a location. There are some alert conditions that are severe, but most should only require the shutdown of an individual affected dispenser or set of dispensers associated with the tank in question. When the ATG is misconfigured, an alert could result in a station-wide shutdown, interrupting the station’s ability to service customers. This not only causes an immediate loss of customers but also leads to the loss of future business as those same customers are unlikely to risk repeating the same experience. They may, temporarily or permanently, alter their commuting behavior and begin frequenting the station down the road instead of yours.
Another common ATG misconfiguration misleads the operator into believing that his tanks are critically low, shutting down dispensers. The system does this by design to avoid stirring up sludge in the bottom of the tank and risking the introduction of air into the system. An opposite misconfiguration tells the operator there is more fuel than is actually available, resulting in a true run-out scenario—the bane of any fuel manager’s existence. In either case, improper tank probe settings almost always lead to lost sales and frustrated customers and operators.
The good news is that many of these misconfigurations can be easily detected by the right software capable of analyzing data collected from the ATG and dispenser. With the right remote management capabilities, these and other configuration issues can both be identified and proactively resolved before they affect your bottom line.
Common ATG Challenges: Inadequate Employee Training
Another related problem compounded by the high employee turnover rate common in this industry is that on-site employees often do not know how to interpret ATG alarms and sometimes simply disarm them. Anything to stop that annoying beeping. As part of the recent EPA requirement for class A, B, and C operator training, employees must be fully trained on how to handle emergency situations. For your company, this could include supplemental training on what each key ATG alarm might mean and the appropriate action to take. Depending on the issue, some federal and state violations can be levied based on the number of transactions conducted after an issue was detected. For example, the station may be fined thousands of dollars for each transaction conducted after an ATG logged a leak event. When an employee repeatedly ignores valid alarms, they not only put the station at risk of a dangerous situation, they perpetuate avoidable financial loss.
ATG Opportunities: Improving the Customer Experience
In the convenience store industry, a crucial component of the customer experience is the speed at which the fuel dispenser is able to deliver product. There is quite a discernible difference between an eight gallon and a four gallon per minute flow rate. The former marks a satisfying customer experience. The latter tests your customer’s patience and brand loyalty.
Like other retail industries, operators must be vigilant in details that directly impact their customers’ experience with their brand. Not every customer may take the time or opportunity to complain about a slow dispenser, but it is well understood that for every customer who complains, there are many more who drive off irritated an may or may not give you a second chance. Even worse, in this constantly connected worlds, customers may utilize one of many social platforms to vent their frustrations to the masses. Some consumers take it upon themselves to provide a "service" to the community by warning other of poor service wherever they find it. You don't want to be caught in these cross-hairs consistently. This has a tangible business impact on your brand and causes a halo effect on other surrounding stations flying the same flag. A brand that has become associated with an unsatisfying experience undermines the business opportunity for other operators. This is why any large oil companies require strict adherence to branding standards by their dealers. However, the customer fueling experience is often missed on their surveys and secret shopper apps.
In conjunction with a negative customer experience, there is also an even more quantifiable business impact of slow flow. A slow dispenser directly correlates to fewer fuel sales. Plain and simple, lower throughput equals less fuel sold.
To measure the customer experience and throughput, an ATG stands front and center. It can be augmented with additional electronics, such as an electronic dispenser interface module, or EDIM, which brings in the dispenser loop data to allow flow rate tracking. By studying deviations from normal transaction trends across a system, fuel operators may accurately infer which dispensers are performing out of specifications. Critical data collected from ATGs can also be analyzed to triangulate not only flow rate issue but root causes. Whether a dirty filter, a failing dispenser component, or even poor fuel quality, the ATG can be used to identify and solve a multitude of issues.
ATG Opportunities: Optimizing Fuel Inventories
A longitudinal analysis of ATG data may reveal opportunities to improve the business. For example, some operators maintain extremely high fuel inventories of thousands of gallons continuously. When such levels are repeated across many convenience stores, they represent substantial corporate resources that are literally buried in the ground. Unturned fuel in the ground translates into dollars that could have been otherwise invested in the business.
ATG Opportunities: Centralized Data Collection & Automated Compliance
A critical aspect of convenience store operations involves data collection to meet numerous state and federal regulatory compliance requirements. Accurate record keeping can be time-consuming and tedious for store operators. Risk management is a known cost of doing business in the petroleum industry. To provide additional store operation support and alleviate labor requirements, the ATG can be used in conjunction with mature software platforms to provide compliance and compliance reporting automation.
In the case of emergencies, centralized alerting provides an additional layer of protection. For example, when a leak has been detected, true positive alarms should not only be going off at the convenience store, they should also be going off at the corporate office. Real-time alarming serves to prevent small accidents from turning into larger, more expensive ones. A critical success factor for real-time alarming is a high performance and reliable network connection at the store. If the network is suffering from congestion or an outage, the alarm will not be successfully transmitted. Multi-path SD-WAN solutions are a cost-effective way to address this critical need over broadband networks.
Ever present and mature, the ATG is an IoT device that can be used to enhance business. Proper ATG setting configuration and training are critical first steps. But after that is done, the data that can be accumulated from these devices allows significant automation and optimization of service and protection against risk. Store managers and fuel delivery teams need to work together to understand the data and make the adjustments necessary to achieve these benefits. Having a robust network that can transmit the data to the right decision makers will bring all of this together and create a new reality: a reality focused on the customer experience and proactive, automated environmental compliance.
*This article was originally published in SIGMA Marketer's IGM Magazine