The Internet of Tanks
The tank telemetry customer value proposition exists since 2000. The main service is to prevent stock outs for property managers and distributors using Machine-to-Machine (M2M) type of connectivity. The latest Internet of Things technologies applied to tank telemetry (we call it “the Internet of Tanks”) allow to prepare new business models, reduce operational costs, build new sales and marketing propositions, digitalize and optimize processes with more efficiency than before.
For nearly two decades the cellular M2M solutions have allowed one machine to communicate to another one using the cellular networks. The installation, hardware, platforms and portals are generally all available from one same provider. The technology bricks (hardware, platforms, and applications) are generally proprietary and all coming from one same service provider.
This model has the advantage of dealing with one vendor and getting one invoice only. Installation campaigns are performed by the vendor from a list of tank locations shared by the oil and gas distributor or property manager. The service provider is the project manager. He captures the tank geometry and dimensions, the availability of a fitting (to place the gauge), makes the appointments for the technicians, configures the alerts and manages the park surveillance. He is also in charge of planning the intervention orders should there be a maintenance visit to perform. The technician has the responsibility of selecting the best suited hardware (ultrasonic vs. pressure sensor) on the best network (cellular vs. LoRa or Sigfox).
The Internet of Tanks (IoT) opens up this model. With IoT technologies, service providers like SilentSoft can extract every building block of the value chain. At SilentSoft, we have taken the strategic decision to make this shift, evolving from a closed model to an open approach. The service offerings are tailored from a MySilentSoft platform licence in case the distributor wishes to operate the service himself up to a complete end-to-end solution. This license only option is currently used by some of our customers (distributors).
Telemetry – What for?
The tank telemetry proposition is primarily used to prevent stock outs. This first (and essential) service can be completed by adding new sales and marketing value propositions.
- « Push » sales : We see many distributors who negotiate annual contracts with their B2B customers. It may be for heat (heating oil and LPG), lubricants or collecting waste oil. Open purchase orders are linked with telemetry propositions allowing automated replenishments. This model helps to deliver on forecasted revenues and gives the end customer piece of mind.
- « Pull » sales : We have distributors who decide to share an access to the My SilentSoft platform (telemetry dashboard) to the end customers. In this case, SilentSoft will white label its platform to the distributors brand. The end customer is within the distributor’s environment. The management of the orders (and the responsibility of stock outs) is transferred to the end customer. This service can be invoiced by the distributor. SilentSoft sees a great deal of garages and workshops who want to have their own view of lubricant and waste oil levels. It is important to note that the distributor still has access to the data. Sales teams and/or administrators connect daily to the My SilentSoft platform and encourage customers to place orders.
- ERP Integration : We see distributors and hauliers who use their own ERP and give access to their customers. In this case the data collected by SilentSoft is retrieved via web services. The transmitted data gives the required information to give visibility on the stock status online.
Logistic optimisation for replenishments makes sense when a certain percentage of the tank park is monitored. The most common figures shared by telemetry service providers are 8 to 15% savings. We have seen distributors share the portal access with hauliers to renegotiate contract services. Certain lubricant distributors have optimized their deliveries by checking all lubricant tanks on site once a threshold is met. This allows to prepare all compartments when going on site. This is particularly appealing to lubricant distributors who promote several blends on a same site.
SilentSoft has worked on a specific case with an LPG distributor in Northern Africa where the distributor decided to equip the whole park to not only avoid stock outs but also better predict the amount of product required before placing an order upstream. The gains covered the telemetry cost the first year. Every distributor has precise models for forecasting. Nevertheless, we can work on evaluating what is the gain in precision. Can the distributors place an order under better conditions should they have better visibility on what can be replenished at any given time?
Migrating to Low Power connectivity
New networks dedicated to the Internet of Things are being promoted throughout Europe. IoT-enabled devices can now operate either on public networks (subscription-based solutions) or on private networks (with services operated by the customer).
The private networks are used in two specific cases: B2C solutions for smart homes (via an xDSL gateway), and facilities (campuses / manufacturing or storage sites) with a wide variety of devices to monitor.
Most of the time, public/operated networks are the best option for tank telemetry. At this stage, SilentSoft is operating devices working on 2G cellular (GPRS) and 3G networks and now on Low Power Wide Area Networks based on the LoRa, NB-IoT and Sigfox technologies. We will also start integrating hardware from third parties. The new low power telemetry devices are more compact (smaller battery for the same life span) and the connectivity subscription rates are similar to low cost 2G.
In terms of sensors, SilentSoft is first integrating pressure and ultrasonic sensors on LoRa and NB-IoT, and in a second phase, on Sigfox. In certain cases, SilentSoft opens the possibility to distributors to contract directly with the installing company.
The MySilentSoft platform will collect and decode the payload (message structure sent from the device) to transform it in meaningful business data (liters). To date, SilentSoft has integrated messages from 5 different hardware providers covering several part numbers.
With more than 20 years of experience in telemetry solutions as an M2M service provider, SilentSoft is now embracing the new opportunities created by the IoT. Contact us to discuss how we can help you to manage efficiently your tanks of lubricants, diesel, heating oil, LPG or waste oil.