Tessol Liquid

[Vivien]

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TESSOL fuels, mineral oils and tank systems GmbH was founded in 1952 and has now focused entirely on the petrol station business. With a station network in the federal states of Baden-Wrttemberg, Bavaria, Hesse, Thuringia and Saxony and steady growth in recent years, the company is now an important part of the AVIA network ( -tessol/unternehmen/mit-uns-auftanken).

Many decision-makers associate the implementation of a new software solution with a high effort concerning time and costs, with problems resulting from missing know-how among the internal staff and with challenges when trying to integrate it in the daily business. From first meetings with prospects and potential customers we know these concerns. In addition, we are aware that the collection and preparation of all equipment data can be a time-consuming task on the customer side.

To enable a quick and easy implementation of omis we decided to work with so-called dummy-equipment representing the equipment data. Together with our standard error catalogue it is possible to send error reports quickly and easily. Via the error code it is possible to generate meaningful reports and analysis (KPIs).

To consider the individual processes at Tessol, an extra report type for the elimination of defects in the course of inspections was implemented. Via an API (interface) tickets are directly transferred to the main service operators. Through this reaction times of service firms are reduced and equipment availability is improved.

With omis we do not simply follow trends, we set them. Thanks to our long experience in the industry we know the specific needs of fuel station operators and retailers. Our software solution fulfills these requirements in a unique way. Our licensing model needs no long explanation and adapts flexibly to different requirements. Our customers do not need to worry about releases, updates or software maintenance. It makes no difference how many users are created and whether the number tomorrow is another than today.

omis 4.0 is a real web application. It can be accessed and used anywhere. Installation of a program is not required and the design is responsive. Through this we offer an optimized operation for all users. Our standard configuration covers the main, daily tasks. For omis to integrate itself optimally in the firm-internal workflows we pay attention to a minimum internal implementation effort on the customer side.

Flexibag can be fit in a 20ft standard container with a volume from 16,000 to 24,000 liters of liquid. The Russia-Ukraine conflict resulted in an oil price increase over the world. To reduce ocean freight cost, more and more customers are choosing OMG Flexibag to transport bulk non-hazardous liquid.

The academician also listed out how the cold chain industry was riddled with logistical black holes: "Another major challenge the Indian cold chain industry faces is the shortage of consistent power supply, the cold chain companies have to invest separately in the power backup as well. Fuel costs in India constitute around 30% of the operating expenses of cold storage in India compared to the 10% in the west. One of the most important reasons for the cold chain industry not booming is the high real estate costs, which have risen by 280%. Apart from the real estate costs, cold storage would require a minimum investment of INR 50 million. The average capacity utilisation in the industry is just around 30%."

While all these studies were being conducted, a nascent end-to-end cold chain solution provider named Tessol was entering the fray. Over the years, Tessol has metamorphosed into a market leader. With founder-director Rajat Gupta helming the now nine-year-old Tessol, the cold chain firm offers a range of customised cold storage solutions, all released into the market after a meticulous and transparent testing phase. ITLN spoke to Gupta on business challenges, future plans and testing times during the pandemic.

Let's start with the Tessol journey. You've come a long way since the company's inception in 2013. How has Tessol's journey evolved over the years?

When we started Tessol in 2013, we realised that energy storage was an underexploited area. We spoke to different customers when we were struck by how the cold chain was a relatively smaller market that held immense potential. It was a fast-growing segment where people were searching high and low for solutions. Coupled with the fact that there was a lot of product loss on the field, resulting in high wastage, this led to criticality in food security, health, etc.

At the time, the market was not as evolved, and e-commerce in the grocery space was almost non-existent. There were very few brands in the market in 2013-14. We started looking at refrigerated trucks using the Phase Change Material (PCM) technology. For about four years, trucks were our primary focus. In those times, diesel prices hovered around the 60s. So, the value proposition was slightly limited for cost-savings. Around 2017, grocery e-commerce entered the scene in a big way. They couldn't deliver the products without a solid cold chain technology. We worked on solutions for their warehouses to maintain temperatures for 24 hours and the logistics around it. For quick commerce, we created an entirely new set of products. The entire category has grown extensively. Covid-19 also helped increase the penetration of e-commerce.

To sum it up, starting from a cost-saving value proposition with trucks, we evolved into a complete solution provider. Ultimately, we are an end-to-end solution provider giving our customers the most optimised solution for the leg where they face a challenge.

Where are these challenges mostly noticed?

It depends on the customer and where he faces a. pain point. For instance, if you look at quick commerce, the pain point is how to deliver highly perishable items like an ice cream within a 30-minute window. If melted ice cream is delivered, nobody accepts it. Another hurdle is how they have about one to three dark stores, and each dark store gets only a specific amount of food or quantity of material because these are limited footprints to feed. The next set of problems that we are working on is how to deliver these without using a refrigerated truck. Here, we have to provide the flexibility of putting only the exact amount of product required.

You mentioned that Covid-19 helped increase the penetration of e-commerce. How was the pandemic's impact felt on the cold chain industry?

The pandemic's overall impact was felt at several levels. Firstly, people started experimenting and using more processed foods that they could store for an extended period. Secondly, they got more familiar with e-commerce, and brands began seeing e-commerce as a dominant channel. Earlier, everybody grappled with reaching the neighbourhood store. Many brands also opted for the B2C movement to directly reach their customers. Seeing the opportunity, the smaller brands use this as a channel to start flooding the market, which paves the way for prominent brands to start setting the standard. This shift toward e-commerce and B2C businesses which would not be possible without a robust cold chain. This has led to more focus on building a sustainable cold chain, which ultimately enabled the setting up of many dark stores. In turn, each dark store has refrigeration infrastructure, and cold chain infrastructure and these services lead to the formalisation of the last mile of your local retail infrastructure.

What kind of temperature-regulating innovations or energy storing devices were used to store the vaccines around Covid-19?

Our thermal battery technology is essentially a way of storing energy in a liquid that converts into a solid and then back into a liquid and then releases energy. So, this is the core of our solutions. The only difference is that depending upon the application; target temperatures could be different. Like chocolate could be between 15 and 25 degrees Celsius, we would need -18 degrees Celsius for ice cream; however, for a vaccine temperatures need to be at about 2-6 degrees Celsius. So, all these different chemicals that we use have formulations with different encapsulations. Each of those can maintain the temperature in the desired range for a certain period. Though the form and shape of the invention may be different, the core technology is the same.

How much of your funding and investment goes into R&D?

Most of our work is centred around application engineering and development. Customers often approach us with specific requirements, as per their route and delivery needs. Most of our designs demand application engineering. So, about 30% of our team is involved in application engineering and design development.

For customisation, we group similar modules together as per need. Solutions come at a modular level, and customers can pick and choose different modules and put them together. Sometimes, we need to build new modules, and that's where the difference between development and application engineering comes in.

How was the product received in the market?

Once built, we started with around 40 brands in April 2021. We sent out all the samples, but before we could get any response, the second Covid wave stuck. Then, a well-known e-commerce brand validated it and started using it for home deliveries. We had limited capacity when we started with only about 1.5 lakh pieces a month. The birth order was about 2 lakh pieces a month. After that, the next customer placed an order for about 5 lakh pieces. Back then, we didn't have the capacity even to produce it. We started adding the manufacturing infrastructure, which was a big challenge as delivery times were vague and no set parameters were in place. Long story short, we now have a capacity of around 2.5 million pieces a month.

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