No Knuckleheads Allowed
In past times, veteran dealers say, yard management and truck loading required few brains, lots of muscles, and a big investment in oversight. That worked back in the day when dealers would build what Robert McCown, manager of McCoy’s Building Supply in Longview, Texas, calls a “slide load.” That’s a delivery where a truck would back up to the job site and simply slide everything onto the ground.
“I’ve been to sites where I’ve seen 4×8 sheets of OSB looking like a deck of cards that’s been opened,” he says. “You may have had the studs on the bottom and had to dig to get to them.”
Today, McCown says, contractors want their goods delivered in a particular, organized way that makes it easier for them to build a home but harder for the dealer to build the load. Yard crews have to keep that in mind when they put items on the back of a flatbed, along with such other concerns as the order in which the truck will be serving multiple customers, the weight of the truck, whether it will pass under low bridges and has a balanced load, and even the time of year (particularly where local governments vary weight limits in recognition of, say, the spring thaw).
“Just configuring one load is like working a Rubik’s cube,” he says.
Robert Pool agrees. Pool, co-owner of Main Street Lumber in Denison, Texas, says he looks for loaders and drivers who can visualize the best way to put materials on a truck even before the first forklift of material drives up.
Business today is no less demanding for dispatchers. “You have to be on your toes,” says Main Street’s dispatcher, Gary Brewer. “Like today: I’ve had a few customers cancel because of the weather. You’ve got to know when to fit everybody in.”
That’s why dispatchers need to display a huge amount of one particular skill. “You have to be very diplomatic and say ‘This is what I’ve got; can you help me out?'” Brewer says. “You’ve got to have a good relationship with outside sales rep personnel. Being up front with your customers will help you. And having 23 years in the business helps a lot, too.”
Indeed, when you talk to executives at construction supply companies, it’s clear they link the quality of their dispatcher with the overall success of their operations. Cady of 5th Avenue Lumber regards his hiring of Todd Buxton as “one of the better things that’s ever happened to us. … Todd is our big success now.” Buxton was promoted to assistant manager but still oversees the dispatching.
Ringing Up Profits
Cell phones have become so common that it’s hard to remember, as Main Street’s Pool does, the days when it was common for a truck driver who encountered a problem on the road to knock on a stranger’s door and ask to borrow the telephone.
We’re in a similar transition now involving cellphones’ picture-taking capabilities. Several dealers interviewed, such as Hendricks at ABC Supply, say it has become standard procedure to take pictures of loads as they leave the yard and as delivered at the job site. Others shoot on an as-needed basis, such as when the driver arrives at a site and finds he can’t place the load at the spot requested.
Picture-taking’s proponents tout the practice as a way to prove all the goods were delivered, particularly if a customer claims some part of the order wasn’t included and is asking for an expensive special delivery to the site. But Main Street’s Pool says the photos also are worthwhile for their effect on crew members.
“The drivers know that the way they stack the load is on film, so the presentation is better, the [dropoff] location is better,” he says.
There’s less agreement on the value of installing global positioning system monitors on trucks. Some dealers swear by it as a tool to tell dispatchers, OSRs and, ultimately, customers where the truck is. It also comes in handy when a last-second request arrives and the dispatcher needs to figure out which truck on the road is best positioned to take the job. But other dealers fear installing GPS creates suspicion among their drivers–suspicions that at times may be justified, some concede, though perhaps not enough to merit having a satellite in the sky monitoring the employee incessantly.
How Are We Doing?
In Alabama, Chambers Lumber is like many operations that have expanded their service area to help make up for reduced business in their usual territory. That has helped keep dollars flowing in, but it also has created a challenge: How to recognize productivity given vast differences in traffic and the distances truckers travel.
Steve Chambers created a formula in which every type of load and each geographic area get ratings. Add the totals and you get a certain value for a delivery in that area. Chambers then pays his drivers based on the higher of either a guaranteed rate or what they actually produce.
“If they can make five loads a day rather than four, it’ll mean more to them,” he says. “We tried the GPS stuff [to improve performance] but it was like trying to push spaghetti. What makes a difference is when you get them involved.”
Paul Corso, who spent 12 years at United Parcel Service before joining ProBuild, where he now is an area vice president based in the San Diego suburb of National City, dislikes such oft-used metrics as sales per employee and dollars per delivery because commodity prices change so much. For loaders, he prefers to measure the number of board feet of product handled per hour. For drivers at bigger yards, he looks at board feet carried on the road per hour. ProBuild doesn’t make any money when its trucks are in the yard, Corso figures, so its metrics encourage the driver to get loaded as quickly as is safely possible and back out to the next job. At smaller yards, he looks less at that metric because the driver often does that job part-time.
Several dealers subscribe to OTIF (On Time In Full)–a measure based on the percentage of deliveries that arrive by the time promised with everything aboard that the dealer was supposed to bring. But beware: Sometimes this percentage can get pushed down when a customer orders a bunch of products but asks that they be delivered on different days. Because of that staging, the order technically doesn’t meet the OTIF standard. DMSi’s Lefler suggests you’ll get a truer OTIF metric if you look at the order on a line-by-line basis. “Probably 90% to 95% accuracy is where a lot of companies are, but they want to get to 98%,” he says.
Carlson, also of DMSi, says she has noticed dealers are looking more closely at how much it costs to make a delivery. Driver salaries differ, and the size of the truck can affect fuel prices. “You might have to carry out one order for a truck that’s a quarter full,” Lefler notes. “It’s going to cost you as much as sending out a full load. Adding that cost in can be quite shocking. Lots of people look at gross margin, but not at net margin.” That’s why OTIF-like measurements matter; cutting down on hot runs caused by mistakes in handling orders can help trim overall costs.
But for all that adding computers and cellphones and GPS can do to improve an LBM operation’s yard work, and for all that sophisticated metrics can do to raise a yard’s efficiency level, if you ask Corso about his major achievement over the past three years, he’ll reply: “From top to bottom, from load builder to dispatcher, we have a better understanding of who our customers are.” In the end, getting ahead is about seeing that customer smile.
