Youthful Experience at Ackner Fuels Inc Prepares Owner for Business Astuteness
Sep 1, 1999 12:00 PM
HARRY ACKNER took over Ackner Fuels Inc in Averill Park, New York, in 1948 when he was hardly more than a boy. He was so young, in fact, that he couldn't qualify for a driver license. Despite his age, Ackner knew the fuel oil business his father had started two years before his untimely death could only succeed if he kept the delivery truck on its round. Fortunately, a cousin and a few of the neighbors also understood that necessity, so they volunteered to drive the truck until the teenager was old enough to be on the road.
"I finished school at 16 and I've been here ever since," Ackner says today. Even while he was attending school, he was operating the business from what he had learned from his dad and what experience was teaching him as the time passed. Eventually, he purchased the company from his mother and younger brother.
Ackner's father, Harry Sr, founded the company soon after World War II just as cooking stoves were being converted from coal to oil. The senior Ackner got the company off the ground with $500 in seed money obtained when he cashed an insurance endowment policy. He used the money to purchase a 1938 Federal truck owned by Mobil Oil Company to deliver kerosene. Harry Sr had gained experience in the industry, having worked for a petroleum jobber and later for a coal company. Then in 1945, he realized the opportunity to start his own business.
"He built up a phenomenal business right away," says Ackner. In the two short years between the time the company was begun and the owner's death at age 45, about 500 customers were being served with just one truck. Today, the company's customer base numbers about 4,500, and about 1.5 million gallons of fuel oil and an additional million gallons of propane are being delivered annually, about 92% for residential customers and the remainder for commercial use. Gallonwise, about 60% of the volume comes from fuel oil and 40% from propane.
The company is closing in on the merger of a long-time competitor, which will double the volume of fuel oil.
Company growth paralleled Ackner's personal development as he left the teen years behind, married, and had five children. "Usually, when the children become involved in a business like we have, they are the ones with exciting and innovative ideas that sometimes have to be reined in," says Sheila Lobdell, Ackner's daughter who is the company's administrative director. Glancing at her father and laughing, she adds, "With our family, it's the reverse."
The family includes Ackner's sons, Keith, who is the truck manager, and Chad, who is the propane manager. Mark Lobdell, Sheila's husband, is in charge of operations and maintenance. Another essential member of the family, Ackner's wife, Beverly, also died at a young age. Before her death, she was a leading force in maintaining the company's image for excellent customer relations.
The couple's daughter and two sons learned the business at an early age, staying figuratively in their father's footsteps and literally at his side when they weren't in school. "I remember hauling hose in snow," says Sheila, pointing out she studied the company from the ground up.
However, keeping up with their father hasn't been easy, they agree. Even today with all of them holding on to the reins, Ackner moves easily ahead - always looking for opportunities.
"Fuel oil has grown steadily in gallons delivered since the mid-1970s," Ackner says. However, he adds, as the 1970s rolled around and the Organization of Petroleum Exporting Countries (OPEC) raised the price of crude oil, United States consumers countered by reducing petroleum product usage.
"I saw people buying wood stoves and installing insulation in their homes, so I decided in 1979 to try and market energy efficient heating equipment," says Ackner. "I wanted to react to the consumer demand."
With that objective in mind, he located some European equipment that was especially effective for saving energy and supplied it to residential customers. What Ackner lost in the amount of fuel sold by taking such a stance, he regained by providing service that would lend itself favorably to a very competitive market. "What is good for our customers is good for us," he says. "You just have to apply some common sense to the real world."
The world for the company is an area that extends north and south of the home office for about 50 miles and about 30 miles east to the Massachusetts state line. The world is filled with hills and dales that are covered with snow in the winter. It's a world that requires skilled drivers to maneuver trucks over narrow, winding roads and driveways - and an alert dispatching and administrative staff to coordinate routing and service.
"Some of the routes are pretty nerve-racking for the driver," says Lobdell. "If a customer has a steep driveway, we try to install a 500-gallon tank so deliveries aren't required as often. The majority of the residential tanks hold 275 gallons."
Fuel oil is picked up at either Port Albany or Port Rensselaer, both on the nearby Hudson River, from terminals operated by Mobil, Amarada Hess, Apex, and Pal Energy. Because the ports are nearby and the fuel readily available, Ackner doesn't need its own storage facilities.
Although Ackner does not have fuel oil storage, the company does have propane storage. A 30,000-gallon tank located about one-half hour from a pipeline and near the Averill Park office serves the company's needs. Ackner maintains one tractor-trailer rig to move propane for storage. The Western Star tractor has a Cummins 460-horsepower engine and Fuller 15-speed transmission. The tractor has an Eaton tandem rear axle and Rockwell front axle. Product is hauled in a 9,200-gallon MC331 tank trailer supplied by Lubbock Tank and Trailer, and equipped with RegO valves and a Blackmer pump.
Both fuel oil and propane cargo tanks are supplied by Amthor International. Fuel oil tanks range from 3,200 to 3,800 gallons in capacity, propane from 3,200 to 3,499 gallons. Fuel oil trucks are made of aluminum and propane of steel.
Standard equipment on the fuel oil tankwagons includes Scully valves, nozzles and overfill protection, EBW Inc bottom-loading adapters, Blackmer pumps, and Hannay hose reels.
Propane tankwagons have Blackmer pumps and RegO and Fisher valves.
The tank trucks last for many years, having a number of truck chassis replacements. Ackner has primarily used Fords exclusively for fuel oil delivery, and a Ford and a Mack for propane. Recently, Mack and Kenworth have been added to the fleet. Typically, the trucks have 210-horsepower engines - either Ford, Caterpillar, or Mack - with Eaton, Fuller (both nine-speed), or Allison five-speed transmissions. Trucks used to haul fuel oil have lift axles. Ackner specifies Michelin tires.
Fuel oil customers own their tanks and receive deliveries based on Ackner's computer software that calculates the temperature and each customer's usage, as well as the tank volume. Time spent on routing and scheduling duties has been significantly reduced. "The monitoring is the key to controlling our costs," says Ackner.
Drivers pick up orders at the office before making rounds and remain in contact through two-way radios. A few drivers carry cell phones. "In really severe winter weather, we like for the drivers to use their own judgment about whether to make the delivery or not," says Keith. "But if our customer is out of fuel, we get it there."
Despite today's propane sales, it was not a fuel of choice in the area until the 1960s when Ackner started the service. "Very few fuel dealers were in propane and fuel oil," says Ackner. To learn how to manage a propane business, he called a New Hampshire dealer he knew and asked for advice - and took it. Soon, he was delivering propane with one bobtail truck, installing the storage tank in 1968, and then adding an additional delivery vehicle.
"We feel propane is complementary to the fuel oil business; however, it requires a significant capital investment as we supply tanks and regulators throughout our propane customer base," says Ackner.
The product is delivered on a routine, route basis that is set up based on the customer's usage. "We have established what the customer's gallon needs are and maintain enough storage so that we can deliver once a month," says Ackner. Because the company owns the customer's tank, the storage capacity is easier to control since the Ackners designate which tank will be used.
The latest update on an Ackner propane tank truck includes a remote control device designed by Amthor International to meet a proposed rule governing propane delivery that requires an attendant to stop the unloading process at a distance from the vehicle. The four-button hand-held device, similar to a garage door opener, will control the PTO, shut down the engine, close the belly valve, and automatically rewind the hose.
Five drivers are used all year with another person added during the winter season. Four are dedicated to fuel oil delivery and two to propane. All have hazardous materials endorsements on their commercial driver license. Training covers hazardous materials handling, and safety meetings are conducted regularly. Emphasis on customer service is a constant, says Chad.
At the customer's tank, product delivery is calculated with a Liquid Controls meter and a Veeder-Root register. Drivers bring printouts into the office for billing after completing rounds. Four people work in the office handling accounts receivable, payroll, delivery and service scheduling, and financial reports, says Sheila.
In the maintenance department, Mark oversees preventive maintenance and minor repairs in the four-bay shop while major repairs are sent to outside vendors. "We are constantly having to readjust clutches because of the wear from the routes," he says.
Oil Changes In an effort to forestall steering and suspension wear, the company uses Lubriquip's Grease Jockey automatic chassis lubrication systems. "Even though we average only 100 to 200 miles a day depending on the time of year, I would probably have to grease the chassis once a week without on-board lubrication," says Mark.
The automatic lubrication occurs every 90 minutes while the vehicle is moving. Individual injectors are sized to feed the exact amount of grease required through tubes connected to lube fittings on king pins, bushings, spring pins, shackles, drag links, tie-rod ends, S-cams, and slack adjusters.
Using the automatic chassis lubrication system for the trucks and the remote control device for the propane deliveries are just two of Ackner's efforts at good management practices that have paid off in the years since he took over the business as a 15-year-old boy. He hasn't forgotten those early days - or the help he received from his cousin and the two thoughtful neighbors. Although one neighbor has died, the other neighbor, Emmett Perry, still lives across the street from the office and remains the company's oldest customer.
In the interim years, Ackner has watched the industry change so that the demands have become greater for operating a small business, particularly because of the fluctuating fuels market and changes in federal regulations that govern operations. "This world is a competitive place," he says. Despite the uncertainty, Ackner says he plansto continue moving forward, always looking for opportunities and keeping up with the industry's progress. And in this period of his life, he's equipped with years of experience - quite a difference from that teenager five decades ago.
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