Time Is Money
Behind most successes is a good strategy.
That holds true whether you’re a chef planning a recipe for a meal, a coach making an important decision during a football game or a dentist coming up with a solution to relieve a patient’s toothache.
For plumbing and mechanical contractors, having a good strategy in place when purchasing service vehicles and inventory systems can make a major difference - especially when it comes to the bank ledger.
“For the vans, durability and appearance are important, as well as how easy it is for the guys to function out of,” states Russ Smith, warehouse and fleet manager at Applewood Plumbing, Heating & Electric in suburban Denver. Applewood currently has 56 service vans on the road.
Fill Them UpMike Pearson, national sales manager for special applications at VT Hackney, has seen a shift in contractor strategy concerning service vehicles since flat-rate pricing in the industry increased in popularity. Hackney sells custom shelving kits for existing trucks as well as bodies with interiors already installed.
“As plumbing contractors went to flat-rate pricing, they started to go with trucks that could haul and store more parts,” he states. “The idea is to try and get a rolling warehouse where it’s one stop at the job and you get the work done. If you are a flat-rate company and have to go back to the shop for a part and the shop is 10 minutes away, you are talking 10 minutes to the shop, 10 minutes in the shop and 10 minutes back to the job. You just added a half-hour or 50 percent to the time factor if that job takes an hour. It goes back to the analogy that getting good fuel mileage is not worth anything unless you have the stock when you get to a job.”
Fuel efficiency and time are especially critical for Alan Givens of Parrish Services in Manassas, Va. Givens has 60-plus vans in his fleet. The majority have Hackney bodies or shelving systems.
“We’re in a heavily populated, large metropolitan area,” Givens notes. “You can spend an hour going 19 miles around here. I have taken the reverse approach with things. Instead of focusing on smaller trucks with higher economy on gas mileage, I’ve gone with making sure we have a large inventory on each van so we’re making only one stop at a job.”
Ashley Henderson and her husband, Donald, owners of DK Plumbing in Fairmont, W. Va., do new commercial construction work on hotels and shopping centers where the use of copper pipe is prevalent. The Hendersons recently purchased two 2011 Dodge Ram 1500 trucks that tow Lark trailers. Having trucks with the ability to tow the heavy trailers - sometimes packed with expensive pipe - factored heavily into their purchasing decision.
“We were looking for towing capacity, power and gas mileage,” Ashley Henderson says. “The trailers are very full, and many times we are pulling heavy weight. We don’t have time to be constantly making repairs on the vehicles. We also want to make sure everything we need is in the trailer so guys aren’t running to Lowe’s five times a day.”
While storage space is important, Jim Quaglia, Reading Body’s marketing and communications director, places durability in that same realm. Reading Body manufactures a variety of custom bodies for service vehicles.
“Corrosion and rust protection is big,” he says. “A few years ago we redesigned our service body lineup to accommodate weight-saving aluminum construction that offers the same quality and durability as steel and will last longer. We offer a full line of aluminum bodies from service bodies through enclosed service vans. It also fits into the green theme because we are using recycled aluminum.”
Under One RoofTo further aid contractors, many vehicle manufacturers offer packages where add-ons such as promotional wrapping, signage and inventory equipment are available through various upfitters at the time of vehicle purchase.
“We’re paying even closer attention to the special needs each contractor has,” states Joe Langhauser, mobility program manager at General Motors. “Our Business Choice program offers that. Our goal is to have the contractor back out on the road in a day or two in a wrapped vehicle with options that meet his needs. All he has to do is move his equipment from his old vehicle to his new vehicle. It’s all about total cost of ownership.”
Telematics also are taking on a greater presence in terms of customizable options for service vehicles. Doug Chandler, GM’s fleet promotions and incentives manager, notes the company offers a Wi-Fi capability option in its new service vehicles where up to 10 devices can connect to the Internet from a jobsite at the same time.
“You will see a lot more with telematics in the future. It will only help in terms of dollars of efficiency from service calls,” Langhauser states.
Ram Truck brand’s cargo van package also features customizable inventory options for contractors, including various load floor configurations and a Wi-Fi hotspot capability.
“The more time a commercial-oriented customer has to be away from his business, the more money he is losing,” Ram Truck Brand Manager Bob Hegbloom says. “We want to make it easier to deliver what he needs and give him that one-stop shop off the lot.”
Mercedes-Benz, which manufactures the Sprinter service vehicle line, has a certification program its engineering group uses to approve upfitters.
“Our dealers have a ready network of companies that can customize a plumber’s Sprinter to his specific needs,” says Dan Barile, Mercedes-Benz product and technology spokesman.
Inventory StrategyWhile fuel economy, towing capabilities and physical inventory accessories are extremely important from an efficiency standpoint, supplemental organizational strategies are equally vital.
Givens hired an inventory runner who works from 9 p.m. to 6 a.m. and goes to technicians’ homes to restock service vans and take partial inventory counts. This usually happens to each truck every other day during a six-day loop.
“We’re saving tens of thousands of dollars if you are talking about the loss of additional billable revenue, wages, fuel and maintenance,” he says. “If the average tech comes into the office every other day to turn in paperwork and get restocked, that’s an hour in there and an hour to get to the shop. If the tech is making $45 an hour, that’s $90 per tech, rounded to $100 with fuel. We don’t have a shortage of work here and it’s even bigger in the summer with guys getting overtime. The gross profit you are losing is huge. This kind of system is a no-brainer.”
Applewood’s blueprint for inventory success boils down to organization and neatness of minimal stock - virtues demanded of its techs. Applewood’s plumbing vans feature Hackney bodies.
“There is nothing worse than looking in the back of any service truck and seeing materials all over the place,” Smith says. “I don’t know how anybody can function like that, to say nothing of the materials that get destroyed and lost. The key to any inventory system in the service industry is to hire the right people with the right mentality and understanding of organization and efficiency, and respecting vehicles and equipment the company has invested in to help each tech achieve success.”
An unorganized truck can manifest trouble in a hurry.
“I don’t care if it’s a two- or three-truck operation or a big fleet like ours, it adds up tremendously,” Smith says. “If you can’t find a part on your truck to complete a job that you know is supposed to be there, that means somebody has to go get it. Appearance and organization is everything. The customer’s first impression of your company and the tech can mean success or failure in earning their trust. You have to hold your techs accountable for what is in their trucks, how the trucks look on the outside and how the techs look when they greet the customer. It increases the efficiency level and maximizes profit potential.”
Marrying an efficient, durable and well-equipped service vehicle with sound inventory practices fits into an old Benjamin Franklin saying all contractors can relate to.
“Time is money,” Smith says.