According to the Energy Information Administration in 2007, there were 8.1 million homes using heating oil as their main source of fuel. The majority of these homeowners will refill their tanks 4 to 5 times during the heating season, typically October through March. You could do well to start a business serving this demographic. However, there are a number of regulations, complexities and start-up expenses involved.
Write a business plan. Starting a home heating oil business can be a costly endeavor. As with any business, you’ll be subject to both foreseeable and unforeseeable events. You’ll need to understand the complexities of the industry, and how fluctuating oil prices, operating costs, competition and weather will affect your business. A significant drop in temperatures and a sudden demand for oil could overwhelm your business. You’ll need to include how you intend to compete with existing oil suppliers in your area. Then detail business expenses such as salaries, benefits, equipment, rent, insurance, utilities and state fees.
Contact your state licensing department to find out what the requirements are for oil technicians. You will need to obtain an oil burner technician certificate or hire certified technicians familiar with your state’s regulations and how to maintain and repair oil furnaces. Find approved courses through the NORA Education Center and North American Technician Excellence (NATE).
Find a location for your plant within a reasonable radius of the area you will service. Contact your zoning office to ensure that your location is properly zoned. Obtain a business permit and liability insurance. Contact your local EPA office to learn what the regulations for oil storage containers are. You will be required to properly label containers and implement policies for the prevention or handling of spills.
Purchase a truck with about a 275 gallon tank, oil storage tanks, oil fill equipment, level sensors and a spill containment system. Purchase commercial auto insurance and product liability insurance.
Locate a regional or local fuel distributor. Find local dealers for furnace and boiler supplies.
Offer both automatic and cash on delivery services to lure in a variety of clientele. In your automatic service, which is designed for customers willing to commit to future service, include a system for tracking your customers' heating oil usage so that you can ensure that they have prompt deliveries, a service contract, yearly maintenance, budget plans and fixed rates. Offer a cheaper, no frills, COD service to customers who don’t want to commit. Create contracts for your auto service that detail the fixed rate, additional services included, your budget cap, length of contract and penalties for early cancellation.
Become a HEAT USA affiliated dealer. HEAT USA is a co-op for residents who use heating oil. Purchase a website. On it, detail your service area. Offer air conditioning or pool heating services.
Shanika Chapman has been writing business-related articles since 2009. She holds a Bachelor of Science in social science from the University of Maryland University College. Chapman also served for four years in the Air Force and has run a successful business since 2008.