1st Reporting
One of the construction industry’s most significant expenses is equipment. If you’re purchasing, you’re looking at high interest rates at a time when building is critical to society’s rebound from the pandemic. Many companies are turning to rental equipment to bring down some of their construction equipment costs. However, there’s still a bleedout of costs that don’t relate to buying or renting equipment—safety and equipment maintenance.
Better equipment handling and management are necessary to cut construction equipment costs. Furthermore, the data points to effective and efficient equipment use as a significant factor in preventing or precursoring accidents and incidents that can make construction costs skyrocket.
So, how do we defeat the foe known as excessive costs? We do it by creating efficient, efficacious equipment handling processes and by using digital tools to streamline, automate, and enable more accessible access to information pertaining to equipment and its management.
In this article, I’ll outline more about how, why, and how to correct inefficient equipment handling and management. We will explore some of the best options for achieving effective equipment management and one of the tools that has made construction equipment management more manageable and more effective than ever before in history.
The Hidden Costs of Poor Equipment Handling
Many new construction project managers face a challenge that many fail at the first time around: Understanding the actual costs of equipment and its management. Some of the associated costs that might slip past a new manager include (but are not limited to) (1):
- State, province, or local sales taxes
- Cost of upkeep (labor, materials)
- Delivery fee
- Financing costs and maintenance requirements to meet financing obligations
- Addon features (GPS, equipment trackers, air conditioning, specific use-case attachments, etc)
- Logos, paint to match company equipment, decals
These often neglected costs are not the only cost of equipment for construction firms. There’s the labor portion related to the equipment to consider. Some estimate that construction costs may have labor expenses as high as 40-50% of the entire project cost. (2)
Now consider the labor required to fulfill regulatory requirements concerning said equipment. For example, let’s take a simple scissor lift used in a variety of construction and service applications. In most countries, at least in Canada and the USA, lift equipment like a scissor lift must fulfill certain safety obligations. These obligations are the usual, detailing things like suitable railings, safety harness tie-off points, emergency lowering systems, horns, and that sort of thing as detailed in the OSHA Scaffolding eTool (3).
In the above scenario with a scissor lift, due diligence on the part of the construction firm would stipulate that any personnel who would use the equipment must first do a quick inspection, visually and practically, to ensure that the minimum safety requirements of the equipment are found to be acceptable prior to use.
Inspecting equipment can take time, and it can take even longer if the person checking the equipment is a poor or slow writer. Similarly, suppose the form or template used to assess the equipment is missing vital points of inspection. In that case, the worker may miss certain things altogether.
Missed safety items open up your organization to liability and increase accident potential. I don’t need to tell you that preventable accidents are a massive headache to manage and also typically a considerable expense. For example, an average incident at a construction site costs companies between $117,000 and $234,000. (4)
Implementing Effective Equipment Handling Practices
Implementation of effective and efficient equipment handling practices, whether it’s owned or rented equipment, is critical to lowering equipment and equipment-labor-related costs.
For example, by integrating a mobile inspection solution into your team, you can eliminate costs associated with extra labor hours to decipher reports, transport, and share reports, analyze multiple reports to look for trends, or even document and complete equipment pre-use safety inspections.
A staged approach is best for integrating tools to improve equipment management. I explain this approach in more detail in my guide, Integrating Mobile Apps into Traditional Field Reporting Processes. If you read my article, you’ll see how you can automate and improve efficiency for reporting not only equipment events like pre-use safety inspections but also any event that requires documentation, from chastizing a team member for breaking company policy (like not wearing their safety gear) to doing a pre-work hazard analysis.
Leveraging Technology for Better Handling
Okay, so we have determined that there is a definite need to help reduce some of the labor and equipment costs associated with construction equipment. I mentioned making processes like equipment pre-use evaluations mobile using a mobile software solution. However, you may want to consider which one I am referring to. In this case (and most other use cases), I recommend the 1st Reporting app.
When was the last time you got a safety report from your team that was a) waterlogged, b) written so poorly only a doctor could decipher the writing, c) missing data, or anonymously submitted? When I was managing service and installation teams (we worked on overhead doors, loading docks, cranes, and other such equipment), I can’t tell you how many times a pre-use equipment report contained mistakes, omissions, or was poorly written, making deciphering a whole task unto itself. Any of these issues can make managing a lot more challenging and generally frustrating (especially with those teams of people who insist on continuously making your life difficult).
With a tool like the 1st Reporting app, you can crush the majority of challenges that paper reporting previously presented. The app enables your team to complete equipment inspections digitally using their mobile devices. Furthermore, with the robust custom form builder at your disposal, you can create equipment (or site, or other) forms that perfectly suit the equipment, regulations, and company requirements.
Real-time Data and Reporting
One of the best features of tools like the 1st Reporting app is that they don’t just help you streamline and automate inspection processes. They also enable you to make decisions at the moment, supported by real-time data submitted from your team(s) on-site.
Compliance Tracking Tools for Construction Equipment
We’ve seen that tracking safety and effectiveness via a mobile reporting solution is both practical and efficient at generating cleaner, more explicit equipment safety and status reports. The benefit of tools like the 1st Reporting app goes far beyond merely tracking safety and regulatory compliance issues with your construction equipment. Here are some other ways that compliance tracking is made easier:
Automated Custom Notifications
A tool like 1st Reporting enables you to create not just custom forms but custom notifications as well. Consider if you have a safety officer in your team who manages all the safety on your construction site or sites. You could ensure they never miss a report by creating a custom report notification that sends them critical information the moment it becomes available via your team or teams on site.
Dynamic Linking
1st Reporting also enables you to link reports dynamically. Here’s a situational example you’ll be familiar with: Let’s say that your construction company owns its construction equipment. One day, your team that uses the equipment notices an issue, such as the horn stopping while working on a lift. During the completion of their mobile, digital equipment report, you have a custom dynamic trigger so that if the team checks off a specific field, like ‘horn not working,’ the system automatically generates an equipment repair request and notifies your selected equipment manager using the custom notification system. In this scenario, both you and your equipment manager could be made aware of the equipment issue before your team in the field completes their inspection report and even has a chance to submit it. You wanted efficiency and lower costs relating to construction equipment, right? I present you with your solution: the 1st Reporting app.
8 Best Practices for Equipment Cost Management
For the best experience with managing construction equipment costs, there are a number of things to keep in mind and prioritize. In my years of managing both service teams and the equipment they use in construction jobs, I’ve found that there are eight primary concerns that you can address to lower your construction equipment costs. Let’s review:
Consistent Data Tracking and Analysis
Routine Data Collection: Gather data on equipment usage, performance, and maintenance needs regularly. Use mobile apps like 1st Reporting to streamline this process and ensure accuracy.
Data Analysis: Analyze the collected data to identify trends, recurring issues, and areas for improvement. Use this information to make informed decisions and predict potential problems before they escalate.
Regular Maintenance Schedules
Preventive Maintenance: Establish and adhere to a preventive maintenance schedule to keep equipment in optimal condition. This procedure helps prevent unexpected breakdowns and extends the equipment’s lifespan.
Maintenance Logs: Maintain detailed logs of all maintenance activities. This documentation is essential for tracking the safe use and condition of the equipment and ensuring compliance with safety standards.
Proper Training for Operators
Comprehensive Training Programs: Invest in comprehensive training programs for equipment operators. Well-trained operators are less likely to misuse equipment, reducing wear and tear and similarly reducing the risk of accidents. You can track training and also share equipment documents like manuals digitally using a tool like the 1st Reporting app.
Ongoing Education: Provide continuing education and refresher courses to keep construction equipment operators updated on best practices and new technologies. Use the 1st Reporting app’s ‘Handbook’ feature to upload and share critical equipment documents and media with your teams on-site.
Routine Inspections and Documentation
Regular Inspections: Ensure your teams conduct regular inspections to identify potential equipment use or safety issues before they become significant problems. Use inspection checklists to ensure thorough evaluations, and customize your inspection forms using 1st Reporting to force critical field completion before the team member can skip to the next item of their inspection. This process virtually eliminates missing information required for you to manage effectively.
Documentation: Document all inspections and findings in a centralized system, like the 1st Reporting app. This standard operating process ensures accountability and provides a clear history of the equipment’s condition.
Leveraging Technology
Mobile Reporting Apps: Mobile reporting apps like 1st Reporting facilitate real-time incident and inspection reporting. They ensure timely data collection and help with quick decision-making.
GPS Tracking: Implement GPS tracking to monitor equipment location and usage. It helps you achieve efficient asset management and reduces the risk of equipment loss or theft.
Investing in Reliable Equipment
Quality Over Cost: Choose reliable, high-quality equipment even if the initial cost is higher. Reliable equipment tends to have lower maintenance costs and a longer lifespan, ultimately saving money.
Lifecycle Cost Analysis: Conduct a lifecycle cost analysis to understand the total cost of ownership, including purchase price, maintenance, and operational costs.
Effective Inventory Management
Spare Parts Management: Maintain an organized inventory of spare parts to ensure your team can fix equipment promptly and minimize downtime.
Inventory Audits: Conduct regular audits of equipment and spare parts inventory to prevent overstocking or stockouts and ensure efficient resource utilization.
Utilizing Data to Predict and Prevent Issues
Predictive Maintenance: Use data analytics to predict equipment failures and schedule preventive maintenance. This approach reduces unexpected breakdowns and extends equipment life.
Condition Monitoring: Implement condition monitoring tools to assess the health of the equipment continuously. This proactive approach enables timely interventions and appropriate preventive repairs or parts replacement before you have a work stoppage due to unforeseen equipment failures.
Taking Action on Reducing Construction Equipment Costs
Cutting construction equipment costs is not just about reducing expenses; it’s about implementing more innovative, more efficient practices that ensure safety, compliance, and operational excellence. By adopting effective equipment handling practices and leveraging advanced tools like the 1st Reporting app, you can significantly reduce unnecessary costs, enhance productivity, and ensure your equipment is always in optimal condition.
The 1st Reporting app stands out as an indispensable tool in this endeavor. Its real-time data collection, customizable forms, GPS tracking, and dynamic linking capabilities streamline your equipment management processes, making it easier to track compliance, perform inspections, and manage maintenance schedules.
Ready to take control of your construction equipment costs? Explore how the 1st Reporting app can transform your equipment management practices. Visit our website or contact us today for a demo and see firsthand how we can help you optimize your operations and reduce costs.
Article Sources
- “What Is Your Equipment’s True Cost?” 2023. Construction Business Owner Magazine. 2023. https://www.constructionbusinessowner.com/business-management/what-your-equipments-true-cost.
- Richer, Michel. 2021. “Labor vs Material Cost in Construction: Overview – Bridgit.” Bridgit. December 22, 2021. https://gobridgit.com/blog/labor-vs-material-cost-in-construction-6-things-to-keep-in-mind/.
- “ETool : Scaffolding – Scissor Lifts | Occupational Safety and Health Administration.” 2024. Osha.gov. 2024. https://www.osha.gov/etools/scaffolding/scissor-lifts#:~:text=Scissor%20lifts%20must%20have%20guardrails,L%20or%2029%20CFR%201915.73%5D..
- Heckendorn, Katya. 2022. “Understanding the ROI of Health and Safety – OSG.” OSG. October 14, 2022. https://osg.ca/understanding-the-roi-of-health-and-safety/.
