Next Master Fleet University May 16-18
Fleet owners know maintenance is one of their biggest operating costs; the third largest cost of operation after drivers and fuel. The good news is that, unlike fuel and drivers, there are usually significant opportunities to bring maintenance costs down and keep trucks rolling.
That's where Master Fleet University, scheduled May 16-18, comes in. A concentrated series of classes designed to help fleet maintenance leaders build complete, best-in-class fleet maintenance programs, Master Fleet University instructors provide the plans for improving shop operations, and just as important, followup afterwards, to help ensure the plans are implemented effectively and goals are achieved.
Not sure? Here's what last year's Master Fleet University grads are saying.
Click here to register for the May 16-18 session.
We’ve already established that capturing data is key to tracking true maintenance costs, the first step in moving a shop toward a best-in-class maintenance operation. In addition to capturing the data, however, is ensuring that various costs are assigned appropriately.
In our world, there are two types of accidents. The first, reported accidents, typically involve a second party, in addition to your driver and/or truck. Reported accidents are then separated into preventable or non-preventable categories. The second category of accidents are “incurred but not reported” (IBNR.) These accidents involve situations like drivers running over something lying on the road, damaging the fuel tanks. Or, a driver goes down a road with over-hanging tree branches and a branch tears a hole in the roof of the trailer.
The cost of each type of accident—reported or IBNR—should be assigned differently.
By now you have probably gathered that we like data. Keeping track of maintenance expenses and procedures and recording the data gives you a great tool for evaluating the performance of your maintenance operations. Once you have the data, there are a number of valuable ways to crunch the numbers.
A couple of weeks ago, we talked about tracking expenses by age/miles bands. Another way to use the same data is to track costs by tractor, trailer, and tire categories.
This week we’re beginning a series of blog posts based on Master Fleet’s MBA (Maintenance Benchmark Assessment) program. Consisting of 154 areas of fleet maintenance operations, MBA takes fleet maintenance operations from good to great, by ensuring that all aspects of maintenance are best in class.
Fix or trade? Tracking maintenance costs by age bands
Given the high cost of new equipment in the trucking industry it’s not surprising that, sometimes, owners are keeping trucks in their fleets longer and longer. Whether or not that decision actually saves money, however, is the question owners should answer before they move forward with, or delay an equipment purchase.
If your shop is tracking maintenance costs by age bands, you have valuable data to help guide that decision making process. Simply put, tracking maintenance costs by age bands is grouping each piece of equipment by age (or miles), grouping tractors and trailers that are 0-12 months old, 13-24 months, 25-36 months, etc., and examining the costs of maintaining that equipment within those bands. Because maintenance costs go up as equipment ages, it’s important to get a handle on the cost of keeping tractors and trailers versus the cost of trading them.
We’re continuing our series this week on maintenance costs, the first chapter of Master Fleet’s MBA program, which aims to help fleet owners and shop leaders achieve best-in-class maintenance standards. By sharing our ideas via the Huddle, we want to encourage members of the Huddle community to comment and share their ideas, helping us all reduce costs and improve our operations.
Maintenance costs: Have you included everything?
Maintenance costs are typically one of the larger costs of fleet operations; usually maintenance ranks just behind the cost of fuel and drivers. Because it’s such a significant cost, and because it’s a cost that you have some control over, it’s a good idea to understand how to best calculate the true cost of maintenance operations.
Certain maintenance costs are obvious, labor immediately comes to mind. By combining payroll and benefits to determine that cost, a company might decide that the cost of maintenance labor is $30/hour.
But what about the cost of uniforms? Training? Shop supplies? A “fully burdened” labor rate— a rate that includes those related costs might be as high as $60/hour. A fully burdened labor rate is just the beginning.
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