The road to success
The concrete plant’s success road
DOING BUSINESS IN THE CONSTRUCTION INDUSTRY HAS BECOME A TOUGH GAME
Everybody in the concrete industry will agree that it is not easy to run a concrete plant in the current struggling economy. Like in any other industry, it imposes rapid changes and tough challenges, but it also offers its share of opportunities. Concrete plants do not have any other choice than adapting their operations to this new reality where small and large producers have the possibility to be back on the path toward profitable growth.
The first consequence of this challenging situation is the fierce pressure on pricing. Contractors are now more than ever very demanding in terms of pricing and don’t hesitate to question longstanding relationships. On the other hand, the level of requirements hasn’t stop increasing and concrete producers find them caught between a rock and a hard place.
As a result, you’re probably experiencing a high level of competition that you’ve never seen in the past, because each of your competitors faces the same dilemmas.
In these circumstances, business advisors recommend to stay away from the turmoil of price wars and insist on added value creation. At the last NRMCA conference, some industry experts came to the same conclusion. For contractors, added values can be found in high performance added products such as steel fibers or with an extremely reliable delivery service. But that’s not all!!
The key to more productivity lies also in rationalization of the operation process, because concrete producers will be surprised to see that hidden dollars can be found in the backyard of every concrete plant.
WHERE CAN YOU FIND THE HIDDEN MONEY OF YOUR CONCRETE PLANT?
This question might sound as a provocation for many of you, since a concrete plant is far from being a treasure island where gold can be found behind every palm three. But a thorough examination of concrete plants’ processes has led Marcotte Systems to determine areas of improvement for profit growth. The idea is to improve your profit wedge.
Simply put, it consists of diminishing unnecessary costs and maximizing the revenue growth.
BATCHING CHALLENGES: INCREASE QUALITY AND CONTROL INVENTORY
As we already mentioned earlier, one way to increase profit is to deliver meaningful added values to your customers. An excellent example of an in-demand product is the Self-Consolidating Concrete. Easy to set, this type of concrete is very well appreciated by contractors, since it really represents a time saving opportunity and even offers strong resistance capabilities for complex moulded structures. So, with your customers, never forget to highlight the benefits of this type of concrete.
On the other hand, concrete producers can save money with their batching operations by carrying out a wise inventory management. Ingredient like cement or add mixture are extremely costly and need to be managed with care and precision. Moreover, a poor raw material management can have an impact not only on your cost, but also on the quality of your concrete. Hence, it will affect your customer satisfaction and the reputation of your organization. In this industry, a consistent quality is one of the key to your success and will save your company from paying expensive claims.
DISPATCHING RULES: OPTIMIZATION AT EVERY LEVEL
“Optimization”, it sounds like a very trendy expression these days. Clearly, what it represents for you, concrete producers, is that you have to take the full advantage of your resources. At the delivery level, it means your plant and your truck fleet. The concrete delivery process is a road full of obstacles that are sometimes difficult to anticipate: traffic, accidents, and delays at the job site… But with today’s technology, it is possible to make the adjustments to your job scheduling just a few second later after these incidents happen. On other hand, certain road bumps are predictable! For example, the level of experience of your truck drivers is something that you can take into consideration in a wise and precise job scheduling. Here the objective is to organize your resources, so it maximizes the Return On Investment of each of your trucks.
Ready-mix dispatchers often suffer from a lack of information especially when they schedule jobs for the next day. Even though we would like to, it is extremely difficult to please all our customers. We try our best of course! But in the real life, certain customers have to be served in priority. Now, I raise the question: How do you prioritize your customer orders? How do you establish that this customer will receive your first concrete truck of the day? Some will say that they always serve their most profitable or loyal customer. Even with these types of criterion, it is not easy to have an objective approach. Concrete producer’s dispatchers need reliable and updated data about their customers to make these decisions and it certainly starts with information like: sales and profitability history, claims amounts, Day Sales Outstanding (DSO), or unexpected events…
HOW TO SHARPEN YOUR COMPETITIVE EDGE?
Today’s technologies are now available to help solving the problems we just mentioned. Probes can be installed at each corner of your plant to capture humidity and temperature levels that have an impact on your mix designs. Batching systems are now smart enough to aggregate these data and to the make necessary adjustments to your mix designs all by them self! The advantages of these good practices are a clear improvement in terms of quality consistency, a straight reduction of your material cost and a time saving opportunity for your batchers. In effect, these systems will produce the same quality level of concrete, batch after batch, regardless of the environmental conditions. Furthermore, the manual interventions in automated systems that are sometime banned by certain regulations will simply become unnecessary, which will greatly improve your material inventory management.
Batching systems have also made tremendous progress in the way they handle complex mix designs. For example, within Marcotte Control Batching systems, it is now possible to modify the discharge sequences of materials, so it simplifies the manufacturing process of complicated concretes like SCC. The flexibility of these types of functionality makes spec targets easier to reach and helps your batchers to save a substantial amount of time.
On the dispatch operation side, the integration of tools like Google maps and GPS gives the opportunity to react instantly when unpredictable events happen. Plus, these systems guide dispatchers all along the delivery process to optimize the operation during load time, wash time or on the road. At each step of the delivery process, there are time and money to be saved. Mobile devices combined with centralized IT systems provide meaningful and constantly updated information, so your dispatchers are always in full control in order to make the right call.
Also, Dispatch systems can leverage customer information like sales, profitability and DSO. So, when your dispatchers make their schedules, they can give priority to certain customers in full awareness of their values for the organization. According business management experts, productivity gains are found in the cooperation between departments. With the Client Scoring functionality, Marcotte associate the sales and accounting departments to the operation’s decisions.
The evolution of technologies impacts every industry. Data processing and Information are the epicenter of this revolution. Data have become an asset, information a weapon against your competition. But data will only become information, if it is meaningful for your employees. Batching and dispatching systems sustain your organization in this quest where time, information and money are connected to give you the edge over your competition.