Even with the surge in construction spending expected over the next two years as a result of the economic stimulus bill, times are still tough for construction business owners.

In fact, some predict that we won't return to peak construction spending levels until 2012 or after.

The good news is, with recent advances in technology, many contractors are finding ways to run their businesses more efficiently, be more competitive and even save money by monitoring their equipment usage more closely.

Summers-Taylor, Inc., a heavy and highway construction contractor in Northeast Tennessee, estimates that the company reduced its fuel consumption by 20 percent last year by more closely monitoring equipment idle times and managing fuel efficiency.

Colorado-based Arapahoe Utilities and Infrastructure recovered more than $50,000 in stolen equipment over a two-year period, often with the equipment back at work on the jobsite within hours, all with the help of global positioning system (GPS) technology.

Other owners are saving money on maintenance, insurance premiums and payroll through the use of remote asset management technology.

How it Works

Remote asset management solutions generally consist of GPS hardware, which is attached to each piece of equipment, and software on a desktop computer that provides office workers with real-time or historical data about equipment usage.

The GPS hardware sends equipment data about each piece of equipment to a central server using a cell phone tower. Back in the office, decision makers can see the precise location of the equipment-which may be spread across multiple jobsites in multiple states-as well as information such as run time, idle time and speed. In addition, some solutions include customizable and easy-to-read charts, graphs and reports to make the data easier to use.

This kind of visibility is providing a significant return on the technology investment for contractors of all types and sizes. By cutting costs on expenses like fuel and maintenance, and increasing revenue by improving site management and equipment productivity, construction companies are seeing improvements to both the top and bottom lines.

"Contractors who think things are going fine without this type of technology may be hesitant to change their processes, but those who do are sure to see a big payoff," said Glenn Matteson, senior consultant with the construction management consulting firm, FMI Corp. "The initial return is mostly in dollars and pennies, but when you roll those all up, it's equating to a lot of money saved."

Fuel Management

Saving money on fuel costs is one of the fastest and easiest ways to begin reaping the benefits of an asset management system. Nearly every asset management solution on the market provides detailed data about engine idle times, and the results are often shocking, even to managers.

"In every meeting, we would discuss the need to reduce our idle times to save money on fuel, but without the numbers to back it up, it didn't remain a priority for long," said Ted Bryant, vice president at Summers-Taylor. "As soon as we left the meeting and another issue came up, we forgot about idle times."

But when fuel prices skyrocketed in the summer of 2007, Summers-Taylor took action toward reducing idle times. The company installed a remote asset management system, monitored daily reports on idle times and implemented a policy against all unnecessary engine idling.

"We send the idle time reports to superintendents so they can monitor it on the equipment they're responsible for. Then, we can create reports to help us track idle times and trends over longer periods of time," said Bryant.

In addition to saving more than 20 percent in fuel costs the first year, the company also saw a direct correlation between idle times, jobsite productivity and individual employee job performance.

"We could see immediately that we were saving money on fuel usage by monitoring and managing idle times, and we also saw right away that when our idle times went down, our productivity went up," said Bryant.

In addition to saving money on fuel costs, some solutions also provide customizable calculations for off-road fuel tax, state mileage reports, California Air Resources Board (CARB) reporting and other key metrics and regulatory requirements.

Preventive Maintenance

One of the biggest benefits of asset management technology is a reduction in preventive and corrective maintenance costs. With maintenance records for each piece of equipment in one central location, an asset management solution can automate the entire process of monitoring equipment maintenance schedules.

Some solutions include automated reports about engine hours, current mileage and other equipment usage details, making it easier to stay on top of equipment wear and tear. Also, be sure to look for a solution that provides alerts (usually via e-mail or text message) when scheduled equipment maintenance is due.


Construction Business Owner, May 2009