Top Heavy Equipment Fleet Management Strategies
Putting the right fleet management strategies in place is crucial for maintaining your investment and setting your business up for success. A general rule of thumb is to replace your construction equipment when its maintenance costs exceed 30% of its resale value, but the key to maximizing the return on all your machines is keeping them productive for as long as possible. The best way to accomplish that is through effective equipment fleet management.
Keep up on equipment maintenance
It’s important to enroll your whole fleet of machines into preventive maintenance contracts. They will ensure that all routine service is completed at the recommended intervals and that everything is properly documented. Keeping up on proactive maintenance is a key part of heavy equipment fleet management that will help stabilize operational costs and reduce expensive downtime by catching problems early.
Conduct regular fluid analysis
Fluid analysis is one of the most powerful fleet management strategies that you have at your disposal. By analyzing your machine’s fluids, you can compare contaminant levels to normal wear rates in order to identify potential problems with components before a serious failure occurs, helping you avoid unnecessary or unexpected downtime.
Implement equipment monitoring tools
Modern equipment features advanced tools and systems that monitor performance, collect important information, and convert raw data into actionable information you can use. There is software available to help you determine a machine's resale value, calculate ownership and operating costs, and estimate repairs, parts and labor expenses.
Always maintain updated records
Keeping accurate, comprehensive records helps you predict equipment productivity and operational costs, like working hours, fuel consumption, maintenance expenses, and more. Good information is crucial for equipment fleet management and allows you to make the best decisions possible when it comes to deciding whether to replace or repair equipment.
Remember the 80-20 rule
80% of maintenance costs are spent on 20% of machine problems. It’s important to identify common or repeat issues and take action to fix those things that eat up your operating budget and cause unnecessary and costly downtime.
Know when to rebuild or replace equipment
Smart equipment fleet management strategies will often mean deciding whether to rebuild or replace a machine. Here is a simple formula that you can use to accurately calculate and compare the costs of each choice:
Cost to rebuild (new equipment price x .5)/equipment life (estimated hours x .75) = cost per hour
For example, a new piece of equipment that is $120,000 with an estimated life of 10,000 hours would cost $12 per hour to operate. To compare, calculate the cost to rebuild.
($120,000)(.5)/(10,000)(.75) = $8 per hour
If the cost to rebuild is $70,000 for an estimated equipment life of 7,500 hours, at $8 per hour, it is more cost effective to rebuild than to replace.
If you have any questions about equipment fleet management strategies, contact our team today!