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Print Edition StoriesFriday, November 6, 2009
Online heating oil price reports aim for lowest cost delivery
By Galen Moore
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A handful of Web-savvy startups are betting Internet technology will change the game for heating oil delivery, starting this winter.
Clickfil LLC is the latest to challenge an industry led by family-owned companies whose business models have seen little change for the better part of a century. A spin-off of Canadian Fort Reliance Ltd., the parent company of wholesaler Irving Oil, Clickfil began delivering oil in five suburbs north and northwest of Boston in mid-October. As an online option, it joins fuelstart.com, lowermyheat.com and ordermyoil.com.
The three sites, all launched recently in Massachusetts, don’t deliver oil. Rather, they aim to report prices, enabling heating-oil buyers to comparison shop among delivery companies.
Founded by two former Fort Reliance executives, Clickfil promises to cut the cost of home heating-oil delivery by automating ordering and billing. A new customer can set up an account on the web site and get an initial delivery without picking up the phone.
To Bob Duffy, sales manager at James Devaney Fuel Co., that doesn’t seem right. “In this automated world we’re in, the human element’s sometimes missed,” he said. “If someone’s going to sign up with us, I want to have someone at your house to check your tank and make sure it’s OK to receive oil.”
Clickfil has a long way to go before replacing human contact in the oil business. Delivering oil since 1934, Devaney has 39 trucks on the road, to Clickfil’s three.
But Clickfil has trucks in reserve. “We can grow as quickly as we need to,” said marketing and sales director David Simmons, who co-founded the company with operations director Louis Labelle.
Clickfil claims to offer prices 30 cents per gallon lower than the competition. That claim is accurate — as long as the company’s prices are compared with full-service oil retailers that also provide financing options and furnace maintenance service. Clickfil does not offer those services, but refers customers to third-party companies.
As of Nov. 4, Clickfil’s price of $2.36 a gallon was near prices listed by other north-of-Boston discount companies, according to newenglandoil.com.
Disillusionment with pricing contracts — offered by full-service companies — may benefit discount providers in the short term, said Michael Ferrante, president of the Massachusetts Oilheat Council. Last year’s early spike in heating-oil prices left some customers locked into overpriced contracts.
Enter web sites that enable consumers to shop and compare discount oil companies. Fuelstart, launched in 2007, is the oldest of the three providing that information in Massachusetts. When customers shop for a new oil provider, the first place they look is online, said CEO Ryan Finlay. The challenge has been getting heating oil companies to participate.
“At first, they didn’t want to deal with us,” Finlay said. “But now we have 200 companies signed up with us.”
Still, the industry remains wary of full-blown web-based price competition. Most only put up a Yellow Pages-style listing. Among that group, only 25 percent are willing to post a price, Finlay said.
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