When we he wrote for the last time About BeliGas, the social enterprise prides itself on not only being a more affordable option to supply LPG gas cylinders, but also on its mission to hire B40 Malaysians and ex-convicts.
6 months later, a way was found to add value to their services. In June 2021, customers who bought LPG gas could donate 1-10 liters of used cooking oil to get a subsidy for their gas.
Suthan Mookaiah, CEO of BeliGas, told Vulcan Post that this had always been part of the business plan from the very beginning.
“But since we started operating with a lean model, we had to focus first on building the main part of the business, which was to establish logistics and contact points over a wide geographical area and then establish relationships. and trust in the local communities we serve. “
He believes that BeliGas is already ready to enter and consolidate itself as an actor in the collection of used oils.
Resolution of various customer pain points
According to their POV, current customers are more prudent and a business that can help them reduce their costs and be socially responsible will earn their loyalty.
With that in mind, using donations of used cooking oil to subsidize gas prices only made sense. It is a method that kills two birds with one stone: reducing the retail price of gas by 0.80 RM per liter of oil given and helping users properly dispose of and recycle their used oil.
Currently, BeliGas limits the amount of oil donations to a maximum of 10 liters per customer at any given time, as it finds out the logistics of the collections.
Since they make gasoline deliveries to homes with bicycles, it is not feasible to take large donations at once. This is not a problem for their B2B customers as they deliver trucks for them.
To prevent abuse of this system, BeliGas has also outlined the clear Terms and Conditions in its application, including instructions not to add other substances to the oil to increase the volume and avoid passing hot oil to the ‘team.
So where does the oil go?
BeliGas HQ and its distributors (points of sale) operate separately, so when a distributor’s pilots collect the oil, the HQ will buy it. This allows BeliGas dealers to make more profits in their areas from other sources, in addition to selling only gas.
The headquarters then recycles the oil to turn it into biodiesel for their own trucks or to sell it to other biodiesel users. Suthan stated that it is an effective and safe process to use with few modifications.
There are other used oil by-products, such as glycerin, that can be used by lubricant manufacturers, but this is a plan that BeliGas will only explore once a major volume operation has been generated and it has created its own laboratory for to experience.
So far, the reception of users to this new initiative has been excellent, Suthan said. “Of course, it’s still new, so we expect more people to start picking up and getting rid of us in the coming months (as their gas runs out). Even then, we have already done several collections in the homes ”.
Since then, the team has collected 500 L of used cooking oil. Compared to their 15,000-gallon collection plan for the second year of the initiative, they’ve only taken steps for babies, but it’s still a good start.
A model that works for starters
Suthan said this initiative is a permanent addition to BeliGas services and they are working to promote it to raise awareness among its end consumers.
“In the future, we hope to be able to collect about 3-5 liters of oil with all the consumers we serve. We hope to reach the service of 100,000 consumers and, if we achieve this, we are really doing an important part in making our pipes, rivers and sea cleaner of oil-derived pollutants. “
Aside from adding value to its customers, BeliGas wants to continue to provide employment to Malaysia’s underserved communities, especially during this pandemic.
At the moment it has more than 66 people who are not well cared for in their payroll, nor are they restricted to the roles of delivery pilots; some have been hired to work at BeliGas centers and their headquarters.
The model BeliGas has used seems to work well for it; in just one year (July 2021 will be an official year), the social enterprise has generated revenue worth about RM 2.7 million.
To add, Suthan fortunately shared that the company is also profitable, attributing it to its differentiated value proposition among traditional suppliers.
By now, BeliGas is already serving homes and businesses in 214 locations in the Klang Valley, with plans to launch in other states in Malaysia once the closures have decreased.
Featured Image Credit: Suthan Mookaiah, CEO of BeliGas