Full Service vs. Discount Heating Oil Companies
There are many things to consider when choosing a home heating oil provider. If you live in the Northeast, you will have no shortage of options to choose from. In Nassau, Suffolk, Queens, Brooklyn, and Staten Island, New York alone, there are dozens of heating oil delivery companies to choose from. But deciding between full-service and discount heating oil companies (also known as COD oil companies) can require some thought.
It is hard to label one heating oil company as better than another, as the choice is really subjective. The best decision for you depends on your individual home heating oil needs, preferences, and budget.
Discount heating oil, or “COD,” heating oil delivery companies and full-service heating oil delivery companies each offer a unique set of advantages and drawbacks to the homeowner.
What is the difference between “full-service” and “discount” or “COD” heating oil companies?
In comparing full-service and discount heating oil companies, it is important to understand the terminology used to describe them.
Full-Service– a full-service heating oil company provides services and maintenance in addition to the delivery of heating oil itself. These services can include automatic deliveries, budget or payment plans, 24/7 servicing, and so on. Typically, these companies require that you sign a one-year contract to work together. Their heating oil prices will be higher than those offered by discount or “COD” oil companies.
Discount or “COD”– discount or “COD” (“Cash on Delivery”) heating oil companies are able to keep their heating oil prices lower by focusing primarily on one thing: offering you the lowest price possible. They are able to do this by cutting out any baked-in costs for additional home heating oil services like equipment maintenance, boiler repairs, and so on. This means you would have to look elsewhere and/or pay a la carte for repairs and heating system maintenance. This can be a good thing if you don’t end up needing repairs, as you didn’t pay for any unnecessary premiums upfront. In addition, contracts are typically not required when hiring a discount heating oil company, so you have more freedom to pick and choose who you continue to give your business to. Deliveries are usually scheduled “will-call,” meaning you reach out when you are ready for a heating oil delivery.
Benefits of COD or Discount Oil Companies
No long-term contracts – buying from a COD oil (or discount) oil company means that you are not locked into a long-term service contract. This gives you the freedom to shop around and control when you want to make a heating oil purchase. Having this flexibility can save you a lot of money throughout the year. It also gives you the freedom to change suppliers if the one you’re currently using doesn’t meet your standards.
No pricing surprises – whether you are calling in or placing an order online, there is no doubt that you will know what that day’s price-per-gallon is. This differs from automatic oil deliveries where you must pay the company’s dictated price-per-gallon that day without any heads up as to what it might be. Avoiding surprises on your heating oil order is a huge benefit.
Cost savings – by using a discount heating oil company, you are not pre-paying for servicing and maintenance that you may not ever need. This setup puts you in control to decide when to book maintenance services, and who to bid out the prices to.
Benefits of Full-Service Heating Oil Companies
Automatic deliveries – by signing a contract with a full-service oil company, you should never run out of oil. The truth is, this isn’t a perfect science and sometimes your heating oil company will end up dropping the ball on this – it happens. But full-service oil companies do their best to ensure your next delivery is always scheduled without you needing to remind them.
Price security and budget plans – Some full-service oil suppliers even offer price protection plans, which account for fluctuating oil rates and allow you to lock in a price when you start your contract. This ensures you always know what to expect from your heating bill. Some also offer budget plans — budget plan customers pay the same monthly payment regardless of how many gallons are delivered.
Service contract benefits – a service contract with a full-service oil company should provide peace of mind in the event that issues arise. These companies usually offer around-the-clock emergency services in addition to an annual heating system maintenance and safety inspection.
Drawbacks of Full-Service Heating Oil Companies
With a full-service oil company, you are obligated to fill your tank on each visit, and you don’t usually know when the delivery will be coming.
Full-service oil companies use computerized forecasting systems to determine when they should deliver oil and fill up your tank. This system is designed to help them deliver the highest quantity of gallons in the fewest number of trips to your home, minimizing the oil company’s costs and boosting their profitability.
The problem with this is that being obligated to fill up your tank means you can be hit with an unannounced, large oil bill when you weren’t expecting it. This can cause stress during the winter months when it is cold and heating oil usage in your home is high. It isn’t fun getting a $1,500 heating oil bill in the middle of holiday shopping for the season.
Budget plan customers tend to spend between 5-7% more on heating oil costs per year than other customers.
Sounds counterintuitive, right? Well, two factors contribute to this. First, budget-plan customers give the same monthly payment regardless of how many gallons are delivered. This leads to many budget-plan customers not looking closely at the heating oil prices per gallon they are being charged because their monthly payment hasn’t changed.
Second, never “feeling” the increased heating costs leads to customers being laxer about their thermostat settings. Those who are frustrated with rising heating oil prices tend to keep their thermostat lower or do their best to reduce their heating expenses. They might reduce their thermostat at night or when at work, or be more proactive about insulating the home. Those who are comfortable with paying the same monthly payment every month tend to keep their heat on higher and not worry so much about other heat conservation techniques.
Drawbacks of Discount Heating Oil Companies
You are responsible for ordering fuel when you need it.
By using discount or COD oil companies, you are committing to taking a more proactive role in fueling your home. This means putting in the effort to monitor your tank fuel levels, shopping around for the best price, and placing your heating oil delivery orders when you need them. Most homeowners get pretty good at setting reminders to check their tanks and learning their household’s rhythm for heating oil usage but slacking off on this can result in an empty tank and a cold home!
If you need equipment servicing, you will need to book that separately.
Since discount heating oil companies don’t require you to sign annual service contracts, you are in charge of maintaining your heating oil equipment servicing. That will require you to set annual reminders to book a technician to come out and make sure your equipment is safe and in good condition. Most homeowners set a routine to check up on these things around the same time every year.
Choose the Best Oil Delivery Option for You
Both types of oil delivery companies have their benefits. As the homeowner, you must decide what works best for you and your wallet!
Star Home Heat is proud to be a discount heating oil source, where we allow New York state homeowners in Queens, Brooklyn, Long Island, Nassau, and Suffolk the advantage of taking your fueling needs into their own hands. For your convenience, our online platform allows you to see today’s lowest heating oil prices in a matter of seconds. That puts you in the driver’s seat to decide if the price is right for you. From there, you can be connected with reputable heating oil delivery companies in a few easy steps, and your fuel is on its way.
