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Outerwall Enhances Brands’ Fleet Operations With Hybrids and Route Optimization

September 23, 2013, by Greg Basich - Also by this author

Optimizing fleet operations generally doesn’t involve a one-size fits all solution, and at Outerwall Inc., the company behind the Coinstar and Redbox kiosk brands, each brand’s fleet required a different solution to best meet their business needs. For Coinstar, hybrid vehicles have contributed to significant improvements in overall fleet fuel economy and to reduced emissions. For the company’s Redbox brand, the use of route optimization technology has contributed to reductions in the number of miles driven and increases in productivity.

Automotive Fleet received responses from Sam Besser, fleet and DOT compliance manager, Coinstar; Edgar Tapia, transportation manager, Redbox; and Jake Kuffel, senior inventory manager for Redbox, about how each used a different strategy based on their respective fleet’s composition.

Coinstar operates a fleet of 269 vehicles, 174 of them being passenger cars and 95 being trucks and vans. Out of the 174 passenger cars, 128 of them are hybrids. The company’s drivers service and repair a total of 20,700 Coinstar kiosks that are located in retail environments. For its passenger fleet, the company began operating the Toyota Prius in its fleet in 2008 and recently began adding the Ford C-MAX hybrid as well, all with the goal of reducing emissions and improving overall fleet fuel economy.

“We’ve added the Ford C-MAX to the mix but continue to purchase the Toyota Prius,” Besser said. “We’re always looking for the most efficient vehicle options, and added the Ford C-MAX based on its advertised mpg. We expect real-world mpg numbers to continue to climb for vehicles that meet our operational needs.”

The program has thus far been successful, with passenger car fleet mpg increasing from an average of 28.5 mpg in 2010 to 36.9 during the first half of 2013, according to Besser.

“Additionally, driver incentives and awareness of fuel efficient driving practices have increased average fuel economy across both passenger vehicles and heavy duty trucks by 4 percent,” Besser said.

Although the Coinstar fleet operates trucks and vans, the company hasn’t yet found a cost-effective hybrid truck that will meet the company’s business needs.

“During 2012 we also tested a hybrid truck in place of a traditional diesel model in one market,” Besser said. “While we hoped the fuel saved would offset the added lease costs for this vehicle, the results to date have not produced the anticipated savings. However, we learned a great deal and will continue to focus on ways technology can help us reduce our carbon emissions in the future.”

For the Redbox brand, it operates approximately 600 passenger vehicles. These vehicles range from small SUVs like the Jeep Patriot and Chevrolet Equinox to full-size sedans like the Ford Fusion. Redbox has been actively retiring older cars and SUVs and replacing them with fuel-efficient and more environmentally friendly sedans. This shift in fleet vehicle mix from SUVs to sedans, led to a 19-percent improvement in average fuel economy between 2010 and 2012, Tapia and Kuffel stated.

“Every order cycle, we evaluate the fleet market and conduct a Life cycle analysis to determine which make/model will be deployed out to our field teams. The vehicles are evaluated and compared for safety, fuel economy, interior space, driver ergonomics, and cargo space,” Tapia said. Currently, vehicles the brand offers include the Nissan Altima and Subaru Legacy.

Redbox began using the Roadnet route optimization software in 2012 to route its field service representatives when they were in the field delivering new products to the brand’s kiosks. It allows brand employees to determine which kiosks to visit in what order and the most efficient route from one to the next. The brand used a phased approach by region and finished optimizing its entire network in the U.S. earlier this summer (2013), according to Tapia.

“Based on successful implementation of Roadnet, we’re looking into expanding our use of the technology to optimize service schedules and minimize fuel consumption within our Redbox fleet,” Tapia said.

This program, which involved not only route optimization but also general improvements in the kiosk servicing process, has reduced the number of miles driven per kiosk by 36 percent when compared with the number of miles driven in 2010, according to Tapia.

“We’re proud of the transportation efficiency improvements our operations teams have made by leveraging hybrid vehicles and route optimization technologies,” said Nicole Trimble, senior director, corporate responsibility, Outerwall Inc. “In addition to helping us manage environmental impacts, these efforts provide long-term cost savings, strengthening the bottom line.”

By Greg Basich

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