GPS Tracking ROI

here’s an interesting news item from a relatively old-line publication, Mobile Mag, the Mobile Technology Magazine. So what you might ask? Well the ‘what’ is that 6 months ago there was little if anything about GPS in these trade journals who seemed to think that “Mobile Technology” was limited to cell phones and voice radio. The “Power of Place” is really starting to come into its own in the business world.

Sears, one of the feature companies in the MTM article has been tracking their service trucks for several years now with an older-technology system that not only computes the truck’s position via GPS satellites but uses a commercial data satellite system to send the locations and customer service information back to Hq. Next time you see a Sears Service truck, look and see if there isn’t a sort of oversize white “cake pan” on the roof … that’s the data satellite transceiver. So of course they get the usual savings (the usual savings can easily be $200 USD per month per truck - about $26,400,000 USD. Did that make your jaw drop? It did mine, I had to go over my figures several times to make sure I hadn’t slipped a decimal point. What could your business do with that much extra profit per year. Now, of course they made a non-trivial investment to get the system purchased and installed. I have no knowledge of what the actually paid but I can personally provide an equivilent system for under $24,000,000 for 11,000 trucks. Do the math … complete payback in less than a year. Also, with a satellite data system, there’s an ongoing monthly data transfer charge .. sort of like cell phone minutes. At retail, with the satellite they are using, that’s run them about a dollar a day per truck. With a huge fleet like theirs, about $4,000,000 USD per year. But again, do the math. Since they are saving $26 mill a year, it looks to me like they are making a fantastic return on investment, to say the least.

Now I can tell you for suer about another big company, Orkin Pest Control. I’m a dealer for the products Orkin uses to realize savings with their fleet so I can assure you I didn’t just pull these figures out of thin air.

Orkin chose to go the route of a “passive” GPS solution, also called an “after the fact” system. each of Orkin’s field service technician trucks has a little black box (normally installed in the dash behind the radio) and a little silver-dollar size GPS antenna on the inside of the windshield. The ‘black box’ continuous records the trucks position and the date and time, second by second. When the truck returns to the district office at the end of the day, the on board equipment silently transfers the data to the district office computer via a free, unlicensed radio link (much like a cord less phone). Orkin’s own business computer network, already in place, of course for the rest of their business record keeping, transfers the data in seconds to the home office servers in Atlanta. before the driver is finished his or her end of day activities, the district manager can see, who, where and what the driver did that very day and very importantly to Orkin, how fast he or she drove and if seat belts were worn. Orkin feels they have a big business advantage with this system, not only because it flags wasted miles,, fuel lost to idling and the other common ‘motor pool’ kind of issues, but the system has already paid back it’s cost many times over on customer service and risk management savings. In fact, Orkin claims in print that their reduction in risky endeavors, especially speeding and resultant accidents has saved Orkin $14,000,000 USD already.

So what’s the point of all this reporting of millions here and tens of millions there? The point is you — are you going to read this and then browse over to the Dilbert site? Or are you going to reap the benefits?