BY NATHAN WATSON
The movement of goods and materials can often seem secondary to the work that takes place at a construction site. With so many aspects of a project to manage, you may not turn your full attention to transportation unless something goes wrong.
When something does go wrong, however, transportation can have a significant impact on a project. Let’s assume you have a project that requires the shipment of 16 concrete panels over the course of a day. The first truck arrives on time, but the second shipment of panels does not show up. No one can reach the carrier to learn the cause of the delay. Crane and crew are sitting idle at the jobsite with nothing to do.
As the afternoon wears on, you realize the panels will not be delivered on time and decide to mobilize your crane to the next point of erection so that you can work with the panels that have been delivered. Finally, the second truck arrives the next morning. Now you are looking at additional mobilization and down-time for the crew. You will have to spend more money than you expected on labor and equipment rentals to get the work done. One late shipment has cost your company thousands of dollars, perhaps tens of thousands of dollars.
Having a centralized, coordinated approach to transportation can prevent this kind of a mistake from occurring. In fact, well-managed transportation can contribute to the profitability of a construction project. Doing it right, however, usually requires the work of a freight specialist within your organization or through a third-party logistics or brokerage company that understands the unique requirements of the construction industry.
Here are four key ways that a balanced, coordinated approach to transportation can benefit your jobsite.
The bigger the project, the more critical it is for products and materials to arrive on time and in good condition. Unfortunately, large projects also have more complex timelines that involve numerous suppliers and more than one trucking carrier. Clear, consistent communication among all of these parties is crucial to having shipments delivered exactly when they need to be — not too early and certainly not too late.
Your project manager or equipment procurement specialist may not have the time or expertise to constantly stay on top of freight movements. Ideally, your project manager should be able to focus on managing the construction portion of the job. A skilled transportation specialist operates like the conductor of an orchestra. He or she secures the right carriers and hauling equipment, tracks shipments, and stays in touch with drivers, fleet managers and suppliers to make sure machines and materials are where they need to be. When an issue arises, the transportation specialist knows whom to call to immediately address the problem.
The result of this work is the timely arrival of trucks to warehouses, jobsites, or laydown yards. For your company and employees, the transportation process should appear seamless, allowing you to focus on other critical areas of your project.
You may feel confident your company has a good handle on transportation. Perhaps you work with one or two carriers who you trust and have never let you down. A late delivery or damaged shipment has never sabotaged one of your projects, so why fix something that is not broken?
However, there are ways to improve a functional supply chain, generating a greater return for each dollar your company spends on shipping. Transportation efficiency can have a significant impact on your profitability, particularly as your company takes on bigger projects with more miles between suppliers and the jobsite. As your business grows, the carriers you have worked with may be unable or unwilling to keep pace with project demands.
Having access to a large network of carriers across all trucking modes can benefit your construction company in a couple of ways. It provides more trucking capacity, ensuring you can always find drivers and the right equipment willing to serve the lanes to and from your jobsite. The scalability of a large carrier network can also provide more competitive load rates, insulating your company from fluctuations in the trucking market. The load rates you pay will be more economical, especially during times when there is a shortage in certain trucking modes.
The number of available trucks nationwide has increased since last year, but is still 15 percent lower than in 2006, according to the Journal of Commerce’s Truckload Capacity Index. In today’s market, it pays to have access to more carriers. This gives your company greater buying power and the ability to command lower rates.
One of the biggest challenges in trucking today is safety. With more vehicles on the road today than ever before, there is a greater likelihood of accidents or damaged shipments. According to federal statistics, the number of truck crashes that caused property damage increased 21 percent between 2010 and 2013. The number of fatal accidents involving large trucks grew from 3,193 in 2009 to 3,806 in 2013, nearly a 20 percent increase.
More risk, along with stiffer penalties from the Federal Motor Carrier Safety Administration, means shippers must be vigilant in making sure the carriers they use are compliant and safe. Finding those carriers and keeping track of the FMCSA’s monthly scoring system for drivers and carriers can be a lot of work. A third-party logistics company (3PL) that works with carriers that meet compliance, safety accountability (CSA) rules can help with the selection of safe fleets and equipment. Many 3PLs also conduct safety audits and check monthly CSA scores to make sure carriers continue to follow safety rules.
This approach to carrier selection can benefit your company in two ways: you gain a wider selection of compliant carriers and you reduce your liability exposure if something goes wrong. Most importantly, you mitigate the risk of an accident or damaged shipments. That is a true advantage in an industry where the average injury-free accident costs $150,000.
Having a single point-of-contact manage your transportation not only improves performance and cuts wasteful spending, it creates a process. Instead of reinventing the wheel each time you plan transportation for a new project, you now have a proven method of securing carriers, building a schedule and tracking shipments. Over time, your company can continue to finesse this approach and create even more efficiencies.
Every construction project requires a unique set of materials, equipment and workers to get the job done. The role of transportation, however, is always the same: arrive on time and in good condition. Having the same specialists coordinate your transportation can help ensure successful projects and eliminate headaches for you and your employees.
Nathan Watson is a director of business development for Ryan Transportation (www.ryantrans.com), a third-party logistics company that has served the construction industry since 1986. Contact Nathan at (913) 890-6515 or firstname.lastname@example.org.