May 21, 2019

The currency of time and how late delivery times are no longer an option

Russell Down, Chief Executive at Speedy Hire Plc, outlines why providers operating in the construction marketplace must be able to deliver an exceptional level of service to stay ahead of the pack, with late delivery times no longer being an option, causing businesses costly headaches.

Time to Rent

The popularity of renting has permeated our whole society, influenced by businesses and individuals seeing the benefits of exchanging significant, up front, capital expenditure for more appropriate, ongoing, operating expenditure on products and equipment. We have now truly entered the rental era.

Speed is one of the main benefits of renting, or hiring equipment, the term used in the construction industry, especially as projects in the construction industry are increasingly under pressure to reduce turnaround times. With speed, however, reliability is also a crucial consideration in effective planning; the equipment needs to arrive on time and be ready to use.

The Price of Delay

In the construction industry delays are commonplace, despite the negative effect these have on profitability. A recent Cornerstone Project poll showed that more than 85% of companies have experienced delays on recent construction projects which, if a deadline is missed, can increase total costs by up to 20%. An unwelcome cost that few can carry.

These delays are often not the fault of the construction company involved. They can be, caused by adverse weather conditions, the architect or client wishing to make changes to the original design during the construction phase, or disruptions to deliveries and supplies for the project. All of these inevitably hold up progress. Usually, the reason for the delay is quickly forgotten, replaced only by the fact that it was late, damaging the construction company’s reputation.

Don’t Become The Weakest Link

The introduction of new technologies and methodologies are gradually transforming the industry’s track record and mitigating the risk of delays and additional cost. Applications such as building information modelling (BIM) and offsite construction, enable the crucial need for efficiency, however small the role. The pressure is firmly back on the supply chain, to avoid becoming the weakest link, prioritising on time delivery to avoid project disruption later in the project.

Now more than ever, the delivery, collection and availability of equipment are critical capabilities that the construction industry needs in its supply chain, especially when it comes to hiring equipment, as many hiring decisions are last minute and time sensitive.

The Value of Time

The importance of equipment being delivered, as well as collected, on time and being fully operational, comes into even greater focus when looking to accurately plan projects. Suppliers need to be aware of customer situations, i.e. adverse weather or schedule changes and, have the flexibility to align with their customers’ changing needs.

Damaged equipment and delayed deliveries cause significant project scheduling issues and additional cost through highly-paid, skilled tradespeople being onsite and ready to work, but waiting for the right tools to arrive.  Equally, additional costs and fines can also arise from equipment arriving early and blocking public spaces.  Above all, safety has to remain a top priority at every stage of the process.  Getting the right equipment to the right place at the right time is mission critical.

Living in a real-time era

Due to the demand for new housing and more efficient eco-sensitive ways of working, there are now tighter regulations for construction companies to adapt to. It’s time for suppliers to improve their service offer too.

As consumers, we’ve grown accustomed to being able to have our chosen item delivered quickly, exactly when we want it. It has been over two years since Amazon first introduced to its Prime members same day delivery on one million items across England. Our urgent need for efficiency has extended from personal shopping habits to professional procurement.

This Amazon model has set the bar high, effectively optimising todays greatest currency, time. Approximate or delayed delivery times are no longer acceptable.

Meeting the Market

Ultimately, if the end-to-end service from hire suppliers is not delivered in line with the industry’s requirements or not fit-for-purpose, there can be severe consequences, from fines being imposed by local regulators, to a waste of manpower which can erode already tight margins. Favoured suppliers will be those that can be relied on, consistently, with a range of additional value added services.

Catching Up

Greater expectations set by the ‘click-and-collect want-it-now society’, and investors demanding higher return on their investments, are increasing pressure from all sides to bring the industry up to speed.

Productivity and its effect on project timelines have always been important issues for businesses across the construction sector. But as margins tighten, there is less room for manoeuvre than ever before. It is clear that the need for near real-time service and reliability of equipment rental will increasingly become the cornerstone of good working practices.