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Environmental regulation ‘fuels’ company’s rapid growth

Brandon — It’s a simple idea that makes sense and whose time has come — delivering fuel on-site to fleets of vehicles while they sit idle. The idea came to Greg Nethery when companies were being cited for environmentally unsafe underground fuel storage tanks.

At the time, Nethery was providing on-site maintenance and oil changes for commercial vehicles. Why not provide on-site fuel service? That good old American ingenuity kicked in and a new company, On-Site Fuel Service, was born in 1996.

“The federal regulations were put in place in 1996, and that prompted folks to look at ground water pollution,” On-Site Fuel Service’s president said. “In some places I saw tanks leaking fuel on the ground and lines of guys waiting to refuel. Companies started putting in and taking out tanks trying to meet the new regs. One day a maintenance customer asked why I didn’t start bringing fuel on-site, and it sounded like a good idea.”

Nethery, a native of Louisiana who moved to Mississippi in 1986, put together a business model and bought two used trucks. The new company required $10,000 in start-up funds compared to $500 for the maintenance company. During the first six months of his maintenance company, Nethery serviced 6,000 vehicles compared to 400,000 vehicles fueled during On-Site Fuel Service’s first six months.

Today, the company is fueling 51 million vehicles, has 55 employees and is working in every major city across the Sunbelt. High-profile customers such as the United States Postal Service, Federal Express, McLean Grocers and Yellow Corporation are fueling its rapid growth.

“It’s been a wild ride and it’s been a lot of fun,” Nethery said. “We’ve been growing 78% on an annual basis. The startup was to find a solution to underground storage tanks but now the company has moved to productivity issues.”

By having On-Site Fuel Service refuel its vehicles during downtime, companies save time and money. It’s no longer necessary for an employee making $25 an hour to spend time filling up a vehicle. There’s no fuel inventory to keep up with, and using the service saves administrative and theft costs. On-Site Fuel Service manages customers’ fuel supply. Their employees carry handheld computers and leave fuel receipts with customers that detail vehicle numbers, amount of fuel received, location and date.

“Those are the things that make it attractive to customers and are the driving force for our business,” Nethery said.

Additionally, he points out that environmental regulations continue to expand, compounding equipment, fees and insurance costs for companies with large fleets. On-Site Fuel Service follows strict regulations with a safety commitment that goes beyond compliance to industry norms. They buy fuel directly from pipeline fuel terminals.

“We are regulated by the Department of Transportation ((DOT) and Homeland Security. There are a lot of regulations for carrying fuel,” Nethery said. “Post 9/11, it has become more strenuous. Our trucks are inspected by regulators annually, but we inspect them every 30 days.”

All employees undergo training and testing on standards that include:

• Safety in handling and transporting hazardous material

• Testing on function specifics as required by the DOT

• General awareness of prevention of emergency situations

• Reaction to hazardous situations.

Field personnel also are tested to make sure they’re drug free. Nethery says recruiting employees has not been a problem, and the company is blessed with good ones.
Fueling can be performed any time of the day or night according to a customer’s schedule, but Nethery says the lion’s share is done at night. For the U.S. Postal Service’s thousands of vehicles from Texas to Miami it takes place at night. He notes that Jackson has 400 postal vehicles and Miami has 6,000.

Freight companies and armored cars are fueled at night and avoid the risk of stopping at gas stations. Fueling for food carriers can be done while the trucks are running.
The company is currently busy fueling emergency vehicles working in hurricane ravaged Florida. Generators, which are powering telephones, are also being fueled there.

Nethery says the future looks bright for his company because of demands on productivity that his customers have for their business operations.

“The biggest challenge for us is local banks,” he said. “We’ve been banking out of state and part of that is because a company with almost 80% of annual growth is scary to banks. There are some who can handle that but not in this state.”

The entrepreneur said he used other ways to fund his business; ways that would allow the company to grow at a fast rate. He has put in a structure that details and refines reporting figures to enable On-Site Fuel Service to continue to grow and now has a business development group seeking working capital to sustain that growth.

Contact MBJ contributing Lynn Lofton at mbj@msbusiness.com.

About Lynn Lofton

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