Volume 46, Issue 1 - January/February 2007
Stay on Track
ODT Systems Can Help Speed Up Deliveries
by Sam Auseth
When computers were first being introduced to building-supply companies, the attitude was, “what I am doing works fine, why change?” Today, of course, it is difficult to find a building-supply company that isn’t computerized. It’s logical to use computers to maximize inventory turns, reduce accounts receivable, keep accounts payable on track and provide a complete view into the general ledger. What’s missing in this equation is the delivery process, the company’s second largest asset.
Time spent maintaining a computerized dispatch system is far less than that of a paper log. Order Delivery Tracking (ODT) is very much like order entry. It takes less time to enter an order into a computer than it does to write one out. Likewise, it takes less time to enter a delivery and record its status into a computer than onto a paper log. More importantly, it takes less time to recall information when stored electronically and, as with an order entry, the status of deliveries is now available to everyone in the organization.
Make it Speedy!
Customer service is key to any successful business. And today’s customers demand and expect fast responses and accurate information. Rather than responding to a customer’s inquiry by calling the dispatcher who, in turn, calls the driver to gather delivery information, a simple on-screen look up is now possible. This means that not only will the customer receive information quickly without a return call, but the dispatcher and driver will not be interrupted.
Here’s another way to look at it. If a salesperson spends three minutes on a call twice a day (checking on orders which takes him/her six minutes), that’s less time than having a dispatcher on the phone with ten salespeople, which can easily take an hour—a very important hour that could have been spent supervising yard personnel and deliveries.
ODT also provides and presents data that will allow for better management and dispatch operations. Having a display screen will allow the dispatcher to quickly route company assets in the most efficient way possible. Matching up the right equipment, personnel and appropriate route for a delivery or group of deliveries can now be done in advance with very little forethought.
ODT also helps increase productivity. Tracking the beginning and ending times for every delivery provides a real-time overview of the entire operation. The system will know when a load builder starts a job and how long it takes. The tracking system can also provide job turn-around information and answer questions, such as how quickly does one individual go from a completed job to another and how quickly can he load and put a delivery vehicle back on the road.
Is that Coffee on the House?
Keeping track of where your trucks are would seem to be as simple as calling the driver and asking. The question becomes: Is he really there or is that where he expects to be in a few minutes when he finishes his coffee? Most managers would not begrudge a driver over a cup of coffee, but is he running late because of traffic, or is he having that cup of coffee while he reads the paper?
A global positioning system (GPS), which can be added to an ODT system, could tell the difference. Another advantage of a GPS is that you can tell when a truck is ten minutes from the yard, so a dispatcher can get staff ready to help load the truck and get it back on the road.
He Gets How Many Deliveries?
Managing your people more efficiently is where the bulk of the return on investment will come from in having an ODT, and there are also gains to be made by better managing your customers. It’s important to determine how many deliveries your customers take. For example, if one of your customers takes five deliveries and everyone else takes two or three. Or how about those situations where you send out a part truck to one customer today and another the next day? A simple phone call might result in one delivery with both parts the same day. By maintaining the data on delivery costs, an examination can be made on the cost to deliver goods versus what was made on the sale.
Another area ODT can help in is intra-company situations, specifically those fringe areas between locations. For example, logic would suggest that if location A is 20 miles from the customer and locations, and B is 40 miles from the customer and locations, A should ship the order. However, if a truck from location A has to drive through downtown to get there and a truck from location B can drive straight up the interstate, then B would have handled the delivery faster. Using reports from the system, you can compare times from one location to another and determine which should typically deliver to a given area.
Implemented together, the ODT system and GPS typically cost a single location around $10,000 to $12,000 (including installation and training services), with the cost of the systems scale depending on total number of yards and production modules. For example, a lumberyard might use DQ’s door and window line module if it wants to better manage its production. The systems take one week to install and setup and one week of training, and most customers are ready for full production without any assistance within one month of deployment. Using an ODT with a GPS is not a magic bullet; it is simply an extension of the technology many building-supply companies are already using.
A Customer’s Perspective
Shepley Wood Products of Hyannis, Mass., implemented DQ Technologies’ Order Delivery Tracking (ODT) system and global positioning system (GPS) in January 2006.
The company, founded by Tony Shepley in 1978, started as a small lumberyard, with a single delivery vehicle and has grown to be one of Southeastern New England’s largest contractor suppliers.
Shepley has three locations, with a fourth opening this Spring. In 2006, the company boasted 160 employees, and a fleet of 50 vehicles. On average, Shepley accomplishes 47,000 deliveries each year – covering more than 1.5 million miles.
Tony Shepley says, “… We’ve always focused on making accurate, on-time deliveries, but, as the business continues to grow, we need to invest in systems that will grow with us. DQ’s ODT has proven to be an invaluable tool for improving the efficiency of deliveries.”
Mike Tarr, dispatch supervisor, agrees. “It’s amazing how much more efficient our delivery system has become now … We’ve virtually eliminated the need for paper and now have an easy way to look at delivery history without searching through filing cabinets.”
“The Delivery Tracking system has cut down on calls to the shipping office – now sales teams can see exactly where their customer deliveries are,” he adds.
The company also uses GPS tracking technology.
Sam Auseth is account manager for DQ Technologies of Cedar Park, Texas, a company that
provides software solutions and custom systems for a number of different
industries, including building supply distribution.
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