Masonry Magazine December 2005 Page. 20
PARTS & REPAIRS
Having reliable equipment builds strong employee-employer relationships. Townsend says workers appreciate the company making sure equipment is working properly before it leaves the yard. Even something as common as a torn forklift seat is immediately repaired.
In With the New
EVEN WITH AN AGGRESSIVE maintenance program, there comes a time when equipment reaches the end of its lifespan.
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Waiting until total equipment failure
Waiting until total equipment failure forces the contractor to scramble for a replacement, taking away the luxury of shopping for the best price. Tracking maintenance costs and planning proactively will ensure that contractors aren't caught by surprise when it happens. Dolce says tracking costs tells contractors when it's less expensive to buy a new piece of equipment rather than servicing the old one.
"When the old vehicle costs more to own and operate than the new vehicles, it's time to seriously consider if it's time for a new vehicle," he explains. Once a contractor spends 30% of the equipment's residual value on maintenance, that's when it's decision time. Maintenance costs are going to increase dramatically in the ensuing years, skyrocketing to 50% the next year, 150% the following year and 300% the year after that, Dolce says, emphasizing that the time for decisions is at 30%.
"You've got to make a decision to buy new, buy used or rebuild the vehicle," Dolce says, noting that if equipment is worth $7,000, it doesn't make sense to spend $10,000 maintaining it. "A lot of people think they don't have the profit in the company to afford to buy a new vehicle. The bottom line is that it's less expensive to buy new."
Townsend follows that practice for his company's 13 forklifts. Every three to four years, he trades them in for new ones. "We always have the latest technology in our forklifts," he adds. Guth finds it's more cost effective to buy new saws than to fix or rebuild old ones. At $800 apiece, they're not cheap, but they last an average of 18 months, giving the company its money's worth.
Buying used or rebuilding is good if it costs half the price of buying new, Dolce says. Rather than spending $90,000 on new equipment, if a contractor can buy it used or rebuild it for $45,000, it's a good investment, even if the new equipment will last for eight years, but the used or rebuilt one will only last six.
The mindset of some contractors is that if equipment is paid off, they're saving money by not buying new, he says. It's a misconception, and they should be thinking about what they're going to do when the old equipment breaks down. "They're at the moment smart instead of being proactive," he explains. "If your equipment is in poor condition, you're putting yourself in a position to get whacked."
Oil consumption is the biggest indicator of a problem, he says. If equipment is consuming oil, that's the time to think about how it will be replaced. Waiting until total equipment failure will force the contractor to scramble for a replacement, taking away the luxury of shopping for the best price.
"That's when they say, "I have no choice but to throw money at it' It's too late to be proactive," Dolce says. "If the truck isn't working, you have people standing around and you have to pay then. Why put yourself in a situation where you have to be reactive?"
Brett Martin is a freelance writer located in Shakopee, Minn.