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Customer Focus

Fleet Management: Do You Know the Real Cost of Your Forklift Fleet?

February 10, 2012

The acquisition cost of a forklift is only one factor in the overall cost of ownership. The majority of costs involve operating and maintenance expenses. While fleet management is widely known in the trucking industry, it is also a big advantage to companies using it for their forklifts and other material handling assets. Oftentimes, implementing a fleet management program results in a significant cost savings and longer equipment life cycle.

Fleet management is not a small project. Without a dedicated resource to manage the project, knowing the real cost of your forklift fleet is nearly impossible. While a vendor specializing in fleet management can be secured, understanding the program and justifying the costs can be daunting.

Below are questions a fleet management program can answer:

Do you operate the right equipment?
Equipment must be suited for the weight and size of the transported product as well as the available warehouse space and racking.

Is every forklift in use?
Based on the hour meter and the number of warehouse shifts, it is important to determine if every forklift is optimized. Every forklift will be located in the warehouse and analyzed for how often it is operated. A forklift used in a lower usage area may be periodically swapped with a forklift used in a high production area.

Do you have too many or too few units?
After determining the usage of each forklift, it will be decided if the size of your fleet is appropriate for your production.

Are forklift operators driving safely?
Unsafe operation results in damage and needed repairs of the equipment. Incidents found to be abuse are not covered under warranty, generating unexpected maintenance costs. Regular forklift training classes and consistent safety messages can be implemented to decrease the amount of incidents.

Are repair and maintenance invoices consistent and accurate?
Determining the budget for repair and maintenance can be difficult. Many administrative hours can be spent processing purchases orders and invoices for the equipment. A thorough review of each invoice for consistency and accuracy will answer if your company spends additional dollars for a lift having the same repair as another lift at a different cost. Analysis of the planned maintenance (PM) frequency can also point to inefficiencies and additional cost. Planned maintenance done too frequently or not often enough can both have negative cost implications.

Do you know why downtime occurs?
Research of downtime may show how the issue originated. Reviewing trends by department, operator and type of equipment can point to areas of opportunity.

When is it time to replace equipment?
Understanding the true cost of ownership is the key to determining whether it is in the best financial interests of the organization to keep or replace existing equipment. A fleet management program will help track the cost per hour of existing equipment while simultaneously running a comparison of the costs associated with acquiring a new unit with comparable specifications. The guess work is eliminated and replaced with concrete data to aid in the decision making process.

Learn more details about ProLift’s fleet management program. Contact us today to speak to a consultant.

Forklift Safety: Can You Remove the Forklift’s Load Backrest?

January 12, 2012

The load backrest can be the highest point of the forklift. Trailer tops, rack systems, lights, HVAC, sprinkler systems and other overhead obstructions come in contact with load backrests.

If an object above the forklift gets hit, do you blame the load backrest … or the operator?
To put another spin on this question, if a co-worker said “I keep backing into things with the bumper on my pick-up truck”, would you suggest removing the bumper? Or would you mention to your co-worker that he or she needs to be more alert to hazards near the pick-up truck?

Many times the answer to a customer’s question about removing the load backrest is “Yes, remove it and remind your forklift operators to be careful.” But, this is not an accurate answer representing OSHA’s code of federal regulations? (*See below)

The answer is a conditional “yes”. All loads handled by the forklift and the facility it operates within must meet one of the requirements below:

1)      All loads do not go higher than the top of the forks.

2)      All loads are one piece, shrink wrapped, banded or crated.

3)      No loads in the facility are stacked or racked higher than the operator’s head that does not meet the load requirements above. Lift trucks with the load backrest removed must be restricted to handling only loads meeting the requirements above or is restricted to a specific area of the facility that does not contain any loads presenting a hazard.

Provide safe operations while meeting OSHA requirements
Forklift manufacturers offer various heights for the load backrest. When selecting a lift truck, research the warehouse application and the heights of loads to purchase load backrests that meet rather than exceed the requirements. The proper load backrest will provide protection for the forklift operator while reducing the possibility of product and facility damage.

Other solutions include shrink wrapping or banding the loads and restricting a forklift with a removed load backrest to specific areas (i.e. the dock for loading and unloading trailers).

Do you have employees in need of lift truck safety training or pedestrian awareness? Contact ProLift to discuss available training and dates.


* Federal Regulations
OSHA CFR1910.178(e)(2)
Safety Guards: If the type of load presents a hazard, the user shall equip fork trucks with a vertical load backrest extension.

OSHA CFR1910.178(m)(10)
Truck Operations: A load backrest extension shall be used whenever necessary to minimize the possibility of the load or part of it from falling rearward.

OSHA CFR1910.178(q)(6)
Maintenance of Industrial Trucks: Industrial trucks shall not be altered … either by the addition of extra parts … or by the elimination of any parts.

 

 

Is It Time To Upgrade Your Forklift?

As service invoices stack up for your used forklift, it may be time to consider the replacement of the forklift. To determine if the service costs are reasonable and easily explained, follow these best practices.


Cost per hour
Many companies struggle to justify the purchase of a new forklift because the current one is paid in full. However, when a repair is needed, it can often drive the cost per hour well above industry averages. Your best indicator of forklift replacement is the utilization and cost per hour according to the unit’s maintenance history. It’s best to have at least 12 months of maintenance history; however, using several years of data is beneficial to ensure accuracy (i.e. production may peak during a specific season or your company had a short-term project affecting forklift usage).

Number of hours
Typically, an internal combustion (IC) forklift with over 10,000 hours or an electric forklift with over 12,000 hours is due for replacement. Forklifts with high hours will experience failures with major components such as mast chains, carriage and mast rollers, shimming and transmission or drive train work. Electric forklifts will also need battery replacement.

Hidden costs
There are hidden costs of keeping dated equipment as related to safety, ergonomics, emissions and efficiency. An aging truck lags in efficiency, making it harder for you to keep the same production pace. Newer equipment will have technology improvements. For example, forklifts built prior to 2006 protect your warehouse from harmful emissions.

If your company experiences a significant change in product or application, using the wrong forklift can result in additional costs. Examples of poorly applied equipment would be: operating electric forklifts outside, utilizing reach trucks for unloading trailers, using non-freezer package forklifts in a freezer or lifting loads heavier than the capacity of the forklift.

Getting Started
To stay aware of your forklift’s maintenance history, create a separate expense category for forklift maintenance. The most effective forklift maintenance tracking systems also include categories for expenses. Examples might include: tires, planned maintenance, damage and breakdown. This can be accomplished in-house or by contracting with a company for Fleet Management services. Create a check and balance system for hitting expenses against the right asset. On the completed invoice, capture whether the repair was due to abuse. Hour meter readings are also critical input.

 

If you would like more information on ProLift and its Fleet Management services, contact us today to speak to your consultant.

Forklift Maintenance Programs: Guaranteed Maintenance vs Planned Maintenance

December 22, 2011

After investing in a new or pre-owned forklift, consideration should be made to enhancing the asset’s life through regular maintenance. The two most common options are guaranteed maintenance and planned maintenance.

With both programs, experienced technicians will catch potential problems early. Customers will avoid safety issues, costly breakdowns and hours of lost productivity. The servicing dealer will also provide the customer with critical documentation including tracking dates of the forklift’s maintenance schedule as well as detailed records of inspections and repairs.

Below is a comparison of the programs:

Guaranteed Maintenance Program (GM)

Guaranteed Maintenance (also known as Full Maintenance) programs are designed to free the customer from the challenges associated with the ongoing upkeep of the equipment.  A typical GM program includes all of the manufacturer’s recommended periodic services and repairs for breakdowns of major components.

The main advantage to a GM program is the predictable monthly costs. The customer pays a fixed rate and in some cases is offered a complimentary forklift loaner when a service repair experiences an extended downtime.  This allows the customer to easily budget for the costs associated with owning a fleet of forklifts. 

The forklift service provider is responsible for maintaining the unit’s records (i.e. dates of service, hours of usage, repairs) and is motivated to reduce costs for the customer by identifying abuse damage or needed rotation of the equipment fleet.

Before a company arranges a GM program, it should consider the service history of the forklift fleet. If the forklift fleets utilization is low and the costs have been reasonable, predictable and almost always in budget, a GM rate may be too high. GM rates are based on an expected cost per hour over a given time frame. The higher the utilization, the higher the expected costs.

Planned Maintenance Program (PM)

Planned Maintenance Programs are designed to ensure that the basic services (engine oil changing, filter replacement, detailed mechanical inspection, etc.) are completed on a regular basis.   However, they do not include major periodic services such as transmission flushes or breakdowns. 

A PM program offers flexibility to customers, having no long-term agreements. Billing is only for parts and labor utilized and the service work is recorded by the job. Companies with a lower amount of working hours on their forklift can set the schedule less frequently to keep costs in line.

Unlike a GM program, the customer is involved in managing the repairs and costs of the forklift. The costs are not locked in and can be unpredictable.

Interested in comparing our maintenance program with your current service? If you are using a competitor program or servicing your equipment in-house, contact ProLift to request your certificate for a complimentary PM service or information on a GM program.

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