“The system says I only need three loads at that plant, but I know it can hold eight.”
The above quote came from an actual supplyCONNECT user new to the solution. He brought this up as a concern during a follow up a few days after go-live. It’s not the first time this has been brought up as a concern with new users as we introduce a new way to look at our bulk material replenishment processes.
This statement speaks to a few things: he’s passionate about his job and like most in this role, he takes it seriously and wants to do a good job; it shows how we’ve traditionally managed the replenishment process at our plants; it shows there is tremendous opportunity to improve.
First, why does he see this as a problem? He sees it as a problem because of the way we’ve traditionally managed our material replenishment. We’ve trained our people that oversee bulk material orders (either at plants or in centralized offices) to “not run out.” PERIOD.
We’ve always been taught that the easiest and safest way to do that is to fill the plants, but why? Why do we put such a premium on ensuring we have excess material at our plants?
- Running a plant out of materials is very dangerous. Once you start a pour, you must finish it
- Ready mix concrete orders change – and they change fast!
- We generally depend on intermediaries to communicate these changes to us so we can plan loads
The problem is #3 is not timely or accurate enough to account for #1 and #2. So, we’re forced to protect ourselves and over order to avoid big trouble. In many operations, we put this burden on our batch plant operators who have enough to worry about with loading trucks and running the plant. It’s much easier to keep the silos full so you can focus on other areas of the operation. However, there is a cost to this.
If you’re in a market with plenty of drivers, or you have plenty of your own drivers, then you may not see that as an issue. However, in most markets, we’re seeing the pressure to add more and more drivers continue to grow.
If you ARE in a market that has trucking challenges – or if you never seem to have enough drivers for your own private fleet – ordering that way can be a huge strain on the entire network.
The original statement “the system says I only need three loads at that plant, but I know it can hold eight” is equivalent to saying “I want to put five unnecessary loads at one plant.”
If a bulk tanker gets three loads per day, that’s nearly two trucks. So, to take it a step further, what you really mean by that statement is “I want to waste two trucks to fill a plant that doesn’t need the material.”
That’s for one plant. What happens if we’re replenishing our plants this way in a 10-plant network? 20-plant network? 50 - plant network? Two trucks here, two trucks there....and now we’re adding unnecessary strain to an already strained network.
What we lack is real-time visibility and an accurate view of the future. How would having real visibility into what the plants need and when they need raw materials look?
To see this, let’s contrast the new user with another user that has been using supplyCONNECT for some time and has seen the benefits of the increased visibility on his private bulk fleet.
His ready mix business is growing; demand is ramping up, and not only did he not have to add more drivers and trucks to his fleet, but he’s seen his trucking capacity INCREASE.
“I’ve taken care of my ready mix plant needs....and I have hours left over.”
This is in a growing market with a constrained trucking supply. How can he GROW his trucking capacity when everyone else is seeing trucking capacity decrease?
This is possible because with real visibility, he has confidence in managing his trucking tighter and can be much more flexible. Through supplyCONNECT, he knows exactly what the plants need and more importantly when the plants need it. He doesn’t depend on trying to translate ready mix orders into cement and fly ash orders, doesn’t depend on plants communicating what they have on hand, and doesn’t depend on ready mix dispatchers remembering to tell him when things change. He sees all of it in real time and with the click of a button, can plan an entire network’s bulk orders – and he’s nimble enough to adjust on the fly when changes inevitably happen. He can, in essence, see the future.
What are the advantages of additional bulk hauler capacity? It depends on your situation. This customer is turning his “replenishment” fleet into a revenue booster, using the extra hours to haul cement and fly ash for others in the market.
What’s the opportunity for vertically integrated producers? Ensuring trucks are increasing turns at internal ready mix plants and cutting waste will allow you to better service your outside bulk customers. Producers that utilize 3rd party haulers can become better partners and have a stronger position when negotiating rates because you are eliminating their wait times at your plants.
How and why does increased visibility improve the entire network? It does it because:
... even though a plant can hold eight loads...you’ll know they only need three.