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Enough is enough. Eliminate the high costs of construction assets.
Tool theft is an increasingly common problem in construction today, this blog covers best practices to mitigate asset theft and mismanagement.
Poor use of tools in the construction industry can lead to lower productivity, increased costs, and safety hazards. According to a National Institute for Occupational Safety and Health (NIOSH) study, inadequate use and maintenance of tools and equipment contribute to about 400,000 injuries and 200 deaths in the construction industry each year in the United States alone.
Asset mismanagement is also a significant issue in the construction industry. According to the consulting firm McKinsey & Company study, construction projects typically suffer from cost overruns of 80% on average and schedule overruns of 20%. Asset management, including accurate equipment and materials tracking, can help with these overruns.
The use of technology and software, such as GPS tracking and web-based inventory management software, can help mitigate these issues by improving management, control, and visibility into project progress. Training workers on proper tool use and maintenance can also help reduce injuries and improve productivity.
Costs for stolen construction assets range in billions of dollars annually.
The construction industry is known for high rates of stolen assets and lost tools, and these costs can add up quickly for companies. Some estimates suggest that the construction industry loses billions of dollars yearly due to theft and lost tools. Here are some specific costs associated with these issues:
- Equipment & material theft: Construction equipment theft is a significant problem for the industry, with estimates suggesting that companies lose billions of dollars each year due to stolen equipment. The costs associated with equipment theft include the cost of replacing the stolen equipment, the cost of downtime while the equipment is missing, and the cost of increased insurance premiums.
- Lost or damaged tools: Construction companies also face the problem of lost or damaged tools, which can be costly to replace. This includes hand, power, and other specialized tools used in the construction industry.
The costs of the construction industry's stolen assets and lost tools can be significant. Therefore, companies need to protect their assets and minimize these costs. This can include investing in security measures, implementing inventory management software, and ensuring that tools are correctly accounted for and maintained.
Mismanagement of tools and inventory can also result in high costs for construction companies, including increased equipment and tool replacement costs, downtime and lost productivity, labor costs, delays and project overruns, and liability and safety risks.
Mismanagement of tools also contributes to a range of issues for construction companies, including, but not limited to:
- Increased equipment and tool replacement costs: If tools and equipment are not properly maintained and managed, they can become damaged or lost, resulting in increased replacement costs. This can include the cost of purchasing new equipment, repairing damaged equipment, and replacing lost or stolen tools.
- Downtime and lost productivity: When tools and equipment are not readily available or are in poor condition, it can result in increased downtime and lost productivity. This can occur when workers spend time searching for tools, waiting for replacement equipment, or dealing with equipment breakdowns.
- Increased labor costs where workers may need to manage and locate equipment more than focus on their core tasks. This can also increase overtime costs, as workers may require longer hours to compensate for lost productivity.
- Delays and project overruns as workers may need to wait for replacement equipment or deal with unexpected breakdowns. This can result in increased costs due to penalties for missed deadlines or the need to extend contracts.
- Increased liability and safety risks when workers use equipment in poor condition or in improper maintenance resulting in injuries or accidents, increasing liability and insurance costs.
Construction companies should implement proper inventory management systems to mitigate these issues, maintain equipment, and regularly train employees to avoid these costs. Inventory management becomes much more transparent and work for the business.
Below are several popular features the technology can help your construction businesses manage inventory more efficiently:
- Inventory tracking including stock levels, reorder points, and current stock values. It should also provide alerts when inventory levels fall below certain thresholds.
- Barcode scanning allowing users to scan items in and out of inventory using handheld scanners or mobile devices.
- Reporting and analytics to allow users to track inventory usage and identify trends in usage patterns.
- Real-time updates: The software should provide real-time updates on inventory levels and availability, allowing users to make informed decisions about ordering and restocking.
- Integration with other systems, such as your accounting package to streamline inventory management and reduce errors.
- Customization is important enable users to customize the system to their specific needs, including creating custom fields, setting up alerts, and defining workflows.
- Mobile accessibility: The software should be accessible from mobile devices, allowing users to access inventory information on the go.
- Collaboration tools: The software should provide collaboration tools, such as shared workspaces and task assignments, to help teams work together more efficiently.
If your big expense is tools, you need web-based inventory management software.
Take Control of Your Inventory
Simplify inventory management between your jobsites and tool rooms with the TOOL CONNECT™ system featuring Site Manager. With the ability to track tools and review automated reports, this software provides an easy-to-read overview of inventory health.