5 Key Moments When Equipment Data Can Save You Money
Getting better control of equipment costs is an easy way to increase your profit margin.
How well you manage your equipment use on a project, and your fleet in general, can make the difference between a large profit and a small one — or even none at all. Many contractors overspend by keeping rented equipment longer than necessary, by underutilizing the equipment they own or rent, by maintaining equipment before maintenance is truly needed or by not maintaining it in time.
Here are five key moments that present opportunities to save money.
1. When you’re about to rent or buy more equipment.
Contractors often acquire new equipment when the same piece of machinery is sitting idle or underutilized somewhere on a sprawling jobsite or on another jobsite altogether. To avoid overspending, it’s critical to know where your equipment is and how much, or little, it’s being used. If a piece hasn’t moved in two weeks, you probably don’t need another one. Telematics can tell you at a glance where everything is. An equipment management platform such as United Rentals’ Total Control can tell you your utilization rates and help you identify underutilized equipment.
2. When you’re moving to a new stage of a project.
When you’re done digging and it’s time to move on to the next project phase, you’ll waste precious manhours if workers have to sit around waiting for the equipment. Again, telematics can provide instant visibility into every piece of owned or rented equipment, and advanced planning through integrated project management software can help you ensure that equipment is where it needs to be and when. This is also the point in time when it’s crucial to return rental equipment you’re done with. Almost one-quarter of rented equipment is returned 15 days late, and those extra weeks can double the original estimated cost.
3. When you’re bidding on a new project.
Data on equipment consumption and utilization on past projects can help you more accurately estimate equipment costs for the next one.
4. When a piece of equipment needs maintenance.
Predictive maintenance via telematics forecasts when certain maintenance tasks will be needed so you can schedule them based on information about the equipment’s condition and its usage rather than on timelines recommended by the manufacturer. Just-in-time maintenance means you’re not over- or under-scheduling shop time.
5. When a major repair is needed.
Check the depreciation on the equipment or vehicle before you decide whether to repair, rebuild or replace it. Some construction equipment management software automatically tracks depreciation on a monthly basis. Also, calculate the cost of repair, including labor, and what percent of the price of a new machine the cost represents. One rule of thumb advises that if it’s more than half, skip the repair and opt for replacement. If a newer model would use less fuel or offer features that increase operational efficiencies, consider those points, too.
Because equipment represents such a sizable slice of a company’s costs, every incremental improvement in fleet management benefits the bottom line. As with so much else in the construction industry, data analysis at key moments can help drive better equipment decisions.
More on Telematics:
- What is Telematics?
- The Benefits of Telematics: Predictive Maintenance and More
- Avoiding Data Overload from Equipment Telematics
Marianne Wait is an editor and writer who creates content for Fortune 500 brands.