Security and alarm firms hit hard by gas prices

Companies forced to increase rates, implement new vehicle policies

The source estimated that about 10 percent of their total fuel bill, which is currently running around $2.2 million per month, could be attributed to theft by employees.

Restrictions have now been placed upon the company’s technicians to try to curb the losses incurred by fraud.

"We limit the number of times a day that (technicians) can pump gas, we limit the total single dollar amount that they can do or the single number of gallons they can pump because we know there is waste out there," he said.

Our source said that the company also uses exception reporting to manage fuel expenses. The exception reporting is configured such that if an employee fills up at an unusual time of day, the company will know and subsequently be able to track that person’s activities to determine if the purchase was fraudulent.

One employee was bold enough to pump 70 gallons of gas during one transaction, according to the executive.

"When we pulled him in to talk to him, his excuse was he wanted to take his girlfriend to dinner that night and didn’t have money to take her, so he figured he would give people a good deal on gas for cash," he said

While fuel thefts have taken their toll, the business has also been hampered by the fact that they’re locked into certain contracts, which don’t allow them to add a fuel surcharge to customers.

Looking forward, the installing company executive said that he felt the key to reducing both fuel consumption and loss is through the implementation of GPS systems that will allow them not only to keep track of employees, but also help them get the most out of their service routes.

Taking advantage of GPS

According to Matt Naish, director of sales for Contigo, GPS systems not only help companies manage their routes better and cut down on theft, they also keep fleet managers abreast of employees who speed and leave their vehicles needlessly idling, both of which contribute to fuel consumption.

For those companies looking to install a GPS system, Naish said they can expect to pay under $500 for a device for each fleet vehicle and around $30 to $35 per month per vehicle for monitoring services.

Naish said that businesses typically start seeing a return on their investment in just a few months.

"As the prices come down on GPS technology along with the price of gas going up, it is becoming very quickly more economical to do the GPS tracking. It pays for itself sooner," our unnamed source said. "I think we’re going to have to get where we can manage our routing better because the amount of driving we have to do will stay the same. The only way we can reduce the amount of miles we’re driving is to do a better job routing."

Finding a solution

As most security firms and alarm dealers look for internal ways to shave costs associated with fuel, some are asking Congress to step in and provide them with some relief.

"We as a society are making adjustments… we’re paying the price, yet it’s almost like they don’t hear us up on Capitol Hill," Valdez said. "We’re frustrated over it… I don’t think they care. With the amount of taxes we pay something needs to be done, its frustrating."

Despite the calls for help from business owners like Valdez, the outlook on gas prices continues to be grim.

According to a short-term energy report released this week by the Energy Information Association, the price of regular unleaded gasoline, which is currently hovering around a national average of $4.11 a gallon, is expected to remain over $4 a gallon until the fourth quarter of 2009.