Cost Cutting / Filling only to add mark-oil experiments continued--thoughts?!

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Mar 15, 2015
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Florida
Just going over my company books and in just the last 4 months I have seen a 14% increase in operating costs across the board. Next month all Florida companies take another huge hit because voters decided to increase min wage by $1.30 per hr to $10.00. Every 12 mos per State law it will increase by $1.00 per hr every Sept 1.

This is a huge problem for small businesses--especially because 90% of my employees are paid min wage with performance bonuses. Two years ago what was defined as an approved salary management position was redefined so this is the perfect storm of inflation.

Diesel in the last 45 days went from $3.19 per gallon to $4.09 per gallon at truck stops and $3.45 at other stations. I have my own tanks so last fill up was $3.69. Ugh

I am cutting costs everywhere, Where I can I am raising my prices substantially. However, I have long term contracts and when signed inflation was flat or 1-2%.

Increasing maint intervals is a huge savings opportunity. Switching from 10w30 yn blend to dino 15w40 is another savings.

One thing I am considering is an experiment--monitored w oil reports during the OCI and at the change--is filling my trucks to the min line on the dipsticks--just a hair above the add mark. Before each shift oil level is checked so if it declined we would top immediately. That saves 2 quarts per truck per oil change. Since its safe to run the truck down to the add line I'm not sure the 2 quarts between add and full will make a difference in operations. If I proceed I will test this on one truck first.

Any thoughts?

I have also started cutting hand soap w 1/3 water, banned drivers from the employee bathrooms (go before they get the to the shop or stop after the leave the shop in the truck) Locked the AC thermostats and raised the AC temp from 72 to 75. I also have locked the bathrooms for the rest of the staff and customers--have to get a key to use. Been having a problem with a huge amount of toilet paper being stolen because inflation is hitting everyone.

Cutting everywhere possible. In over 30 years in biz I've never seen anything like this. Its going to get worse before it gets better. Having a hard time even getting parts and supplies.

Any thoughts about filling to just above the add mark?? Thanks
 
Are you buying oil and filters in bulk? Can filters be used through two oil changes? Are you putting supplies out to bid? What about burning waste / used oil to generate heat? I know you are in Florida but you must have some chilly days. And what about DEF? Can you save by buying this in bulk volume?? Are your drivers going long distances at speed or are they just driving locally on small raods at speeds of 55 and under? If the latter, is there money to be saved using retreaded tires?
 
I used to fill my MB diesel to 1 qt low to reduce oil going thru the pcv and oil seperator system which were poorly designed on that engine. I also keep my Harley a half qt low to keep oil out of the intake. But I didn't do it for economic reasons.
If you are depending on humans to make sure the oil level is good, I would give yourself some safety room and only fill it 1 qt low. Food for thought.
 
If you're running 2 quarts below full I'd expect that to decrease oil life so it might even cost more than running a full sump. Personally I usually refill my vehicles when they get down 1/2 quart instead of letting them go all the way to the add mark. (1 quart low)
 
Are you buying oil and filters in bulk? Can filters be used through two oil changes? Are you putting supplies out to bid? What about burning waste / used oil to generate heat? I know you are in Florida but you must have some chilly days. And what about DEF? Can you save by buying this in bulk volume?? Are your drivers going long distances at speed or are they just driving locally on small raods at speeds of 55 and under? If the latter, is there money to be saved using retreaded tires?

Most everything I buy is bid out.

I buy everything in bulk including having my own diesel fuel tanks (3,500 gallons). Ironically having my own ranks costs more per gallon than the local filling stations but its the only way to keep my staff from stealing fuel. I control the quality of what gets pumped in my truck and there is a time savings having my own tanks. Many, many times over the years having my own tanks has allowed me to operate when almost all other companies have n fuel. This just happened w the most recent pipeline shutdown.

Filters are jobber filters and others I can get at absolute cheapest prices. The filters are run for one OCI because they are not designed for longer runs. Some of the filters are listed for 7,500 OCIs and other for 10,000 OCIs. They are going between 11k and 14k OCIs currently. Additionally, I have a fleet deal w Ford and all of my trucks get 2 years unlimited miles warranty or 10,000 engine hrs / 250k miles. I keep my trucks now to between 500-600k miles. I follow OEM maint intervals per the normal duty schedule strictly.

Trucks are governed to 68 mph for increased fuel efficiency. With the amount of idle time and drivers flooring the pedal drag racing every stop light there is not much I can really do. We are single digits for the F650s and the 450/550s around 12-13 mpg.

No money savings on retreads--even for semis anymore. I buy new tires wholesale in bulk and my shop installs them in-house. You can buy new tires cheaper than retreads currently. Its been this way for a long time. Its worth the money to run Tier 1 tires when looking at cost per mile. Tier 1 tires can go 85-100k miles before replacement. Retreads and lower tier tires are 25-40k.

Def I have been buying in bulk in 330 gallon totes. However, it costs more in bulk than buying in 2.5 gallon containers. It was for convenience not costs. I have recently switched to buying in 2.5 plastic containers. Much cheaper just a pain.

Thanks for the suggestions......Always looking for savings. Everyone should be banking capital---major recession and market adjustment in additional to more inflation is coming.
 
If you're paying someone to dribble a few ounces of oil into the truck to keep it right at the fill line, what does that labour cost look like? Does it cost more or less than filling the oil to full or at least half-way between full and add?

UOA should tell you whether the oil degrades faster under the conditions you are thinking about testing, so that's easy enough.

I would be curious as to whether you would see higher oil temps by using less volume. Totally speculative, but I suspect that if the oil is making more frequent trips through the engine and less time in the pan and/or cooler, that it would have less time to dump heat. Or maybe it doesn't work that way.
 
If you're running 2 quarts below full I'd expect that to decrease oil life so it might even cost more than running a full sump. Personally I usually refill my vehicles when they get down 1/2 quart instead of letting them go all the way to the add mark. (1 quart low)

This is where I will take oil samples and see what the lab says. To me the add mark is the proper level and the amount above that is only there for a safety margin. On the PSD 6.7 from high to low mark is 2qts. Oil samples at max OCIs show the oil still has a lot of life so I'm interested to see what the lab reports will show.
 
If you're paying someone to dribble a few ounces of oil into the truck to keep it right at the fill line, what does that labour cost look like? Does it cost more or less than filling the oil to full or at least half-way between full and add?

UOA should tell you whether the oil degrades faster under the conditions you are thinking about testing, so that's easy enough.

I would be curious as to whether you would see higher oil temps by using less volume. Totally speculative, but I suspect that if the oil is making more frequent trips through the engine and less time in the pan and/or cooler, that it would have less time to dump heat. Or maybe it doesn't work that way.

The cost is nothing actually. I have my own shop and full time mechanics. They are on salary so there is no more or less cost to me. Our SOP us to have the trucks checked twice daily--lights--safety equip and all fluid levels. Most of the trucks don't consume much oil. Also we have been dribbling oil to top up to the full mark so no changes there.

As far as temps I don't really care about the oil and engine temps--modern diesels and modern trans work at much hotter temps than past technology. All ford Powerstrokes have massive cooling systems with 2 completely separate cooling systems including 2 radiators. The cooling system can handle any temps and maintains a very even temp when we look at the engine readings on the computer.

I have a hypothesis--but zero proof--the engine and all systems with fluids are designed to operate at the min fill levels--coolant, power steering, brakes, oil ect ect and the high mark is a theoretical safety margin fto account for burnoff / seeps / small leaks and people that never check their levels.
 
Are you buying oil and filters in bulk? Can filters be used through two oil changes? Are you putting supplies out to bid? What about burning waste / used oil to generate heat? I know you are in Florida but you must have some chilly days. And what about DEF? Can you save by buying this in bulk volume?? Are your drivers going long distances at speed or are they just driving locally on small raods at speeds of 55 and under? If the latter, is there money to be saved using retreaded tires?

I am laughing a bit about burning the waste oil---haha. Winter is 65F here at worst. Homes here don't even have furnaces or "true" heaters. Almost all of the heat is just the AC compressor running backwards--aka a heat pump which is used a couple of days a year at most. Even my swimming pool has a heat pump as the heater to take the edge off in the winter.

I know they make waste oil heaters but they are hella expensive--like extremely expensive. I have no idea what it costs to heat a house up north when it gets cold so maybe they are cost efficient? Running the AC here in the summer is hella expensive. My power bill in the summer is $800ish a month. Sucks but comfortable.
 
Sounds like you have a big area to cool. If it's a shop area, you might try swamp coolers and industrial ceiling fans. I know that swamp coolers rely on evaporation to perform, and that's not always a given here in FL, so you'll need to check around. North FL would be more appropriate for them.
Otherwise, all of those little savings might add up to where you won't have to join the inflation trend and raise prices too much.
 
Sounds like you have a big area to cool. If it's a shop area, you might try swamp coolers and industrial ceiling fans. I know that swamp coolers rely on evaporation to perform, and that's not always a given here in FL, so you'll need to check around. North FL would be more appropriate for them.
Otherwise, all of those little savings might add up to where you won't have to join the inflation trend and raise prices too much.

Unfortunately the humidity is way too high here for swamp coolers----tried those years ago. Where I can raise prices I already have. The reality of inflation is a given. Its alarming. The guy causing double digit inflation doesn't even remember why or how and that its his fault.

Everybody hold on because its going to be a bumpy ride. Probably will be worse than 2008.
 
This is where I will take oil samples and see what the lab says. To me the add mark is the proper level and the amount above that is only there for a safety margin. On the PSD 6.7 from high to low mark is 2qts. Oil samples at max OCIs show the oil still has a lot of life so I'm interested to see what the lab reports will show.
I would agree. If youre not seeing excessive soot levels, nor oxidative thickening, nor high wear metals, its likely OK. These arent Hondas and Nissans with
Less will heat up slightly faster, save you what, $4-10 per oil change, and may be no worse for wear. Dont want to be penny wise pound foolish, but playing the game between min and max isnt a huge deal with these sumps, IMO.

That said, there is less room for error if a truck starts consuming or leaking. Again its two quarts in some big amount, but that may be the difference between damage and not..... How well does the maintenance team and driver check that?
 
Might I suggest that since you're testing one truck running a lower amount of fill, that you test another with an extended oil change regimen?

If you can get an oil designed for extended use, and UOAs show you can safely get the OCI to a larger # of miles, it could prove to be more cost effective in the long run.

With a fleet, savings could be huge...or not, depending on usage patterns and oil choice.
 
I have also started cutting hand soap w 1/3 water, banned drivers from the employee bathrooms (go before they get the to the shop or stop after the leave the shop in the truck) Locked the AC thermostats and raised the AC temp from 72 to 75. I also have locked the bathrooms for the rest of the staff and customers--have to get a key to use. Been having a problem with a huge amount of toilet paper being stolen because inflation is hitting everyone.

Was this a joke? If it isn't then treating employees in this way will just ruin their attitudes and you will loose money elsewhere.
 
Was this a joke? If it isn't then treating employees in this way will just ruin their attitudes and you will loose money elsewhere.
I think he runs a tight ship - and a business that has low margins to start. So he is finding ways to maintain his ROE.
 
If you can get an oil designed for extended use, and UOAs show you can safely get the OCI to a larger # of miles, it could prove to be more cost effective in the long run.
I agree that it makes much more sense to use an oil capable of extended oil change intervals and extend them, than shorting the quantity of oil in the crankcase. Shorting the quantity seems penny wise and pound foolish.
 
I think you are focusing in the wrong direction on some issues. Penny pinching has its place, but hear me out: What does your employee turnover/retention look like right now? Are you ready for it to spiral faster than inflation? Mistreating your employees by banning them from your facilities restrooms is not only likely illegal, it’s a fast way to lose drivers and staff that you’ll never recover. People talk to each other and post reviews online, who would apply for a minimum wage position where the boss locks them out of the restroom?

Make no mistake here: a business depends on its employees, not the other way around. Treat others as you yourself would like to be treated.
 
agree with the suggestions of extending OCI. If you did a UOA on a couple samples I bet you would find you can increase your mileage. I think if you went 15,000 miles or more on on OCI that would save you more than adding oil just to the fill mark.

some data below to help paint the picture...
  • I assumed 20 trucks because I don't know the number
  • Current OCI = 11k - 14k assume 12.5K average...?
  • 20 trucks x 13 quarts x ~$10/quart = $2,600 or cost per mile of $0.0104 (take 20 trucks @ 12,500 miles)
  • 20 trucks x 500k miles = 10M miles w/ OCI @ 12,500 = 800 oil changes

  • if you fill 2 quarts less per truck 20 x 11 x ~$10 = $2,200 savings of $400 and a cost per mile of $0.0088
  • filling the sump with 2 quarts less is a 15% reduction in oil capacity. If you filled the same volume and went 15% further you could go 14,375 miles

  • If you moved to 15K OCI across the fleet the number looks like this...
  • 20 x 13 x ~$10 = $2,600 or cost per mile of $0.0087
  • 20 trucks x 500k miles = 10M miles w/ OCI @ 15,000 = 667 oil changes

  • If you moved to 18K OCI across the fleet the number looks like this...
  • 20 x 13 x ~$10 = $2,600 or cost per mile of $0.0072
  • 20 trucks x 500k miles = 10M miles w/ OCI @ 18,000 = 556 oil changes
So, IMO I would play with OCI over fill quantity.

Just my $0.02
 
Another area to save might be a fleet card for fuel. I know you said you had issues with stealing so maybe a fleet card would help with that, not sure. If the fleet card is registered to the vehicle and can only be used for fuel would this help...?

just my $0.02
 
I think you are focusing in the wrong direction on some issues. Penny pinching has its place, but hear me out: What does your employee turnover/retention look like right now? Are you ready for it to spiral faster than inflation? Mistreating your employees by banning them from your facilities restrooms is not only likely illegal, it’s a fast way to lose drivers and staff that you’ll never recover. People talk to each other and post reviews online, who would apply for a minimum wage position where the boss locks them out of the restroom?

Make no mistake here: a business depends on its employees, not the other way around. Treat others as you yourself would like to be treated.
I think locking the bathrooms would be in violation of OSHA CFR 1920.141 right? It’s been a while since I’ve been in the HR space but pretty sure locking off and preventing an employee from using the bathroom means that bathroom doesn’t exist. If people using the bathroom between sink swim than maybe it’s time to evaluate the business model/structure.

Have you gone back and requested temporary addendum requests to those long term contracts? Not a guarantee but large companies do that all the time with vendors in times of economic hardship.
 
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