The saying “time is money” is never truer than when it comes to your delivery fleet. Indeed, when delivery trucks are sitting in your yard, waiting for the next order to be picked, staged, wrapped, and loaded/secured onto the bed, they are costing money. When trucks are at jobsites delivering materials, they are making money. It should be quite clear where your trucks should be for most of each delivery day.
In this article, I’ll share how to increase the profitability of your yard by optimizing your traffic flow and minimizing the time that your delivery trucks are driving in and around your site before leaving with their next set of orders. Any obstructions to a perfect flow, including routing trucks through a poorly planned physical layout, assigning the wrong people, executing unstable/non-standard processes, and inadvertently fostering a lack of coordination and/or communication between team members create bottlenecks that hinder your truck’s travel, both in distance and in time. As I’ll show, those obstructions are a direct hit to your bottom line.
From my experience working with LBM dealers to increase the efficiency of their operations, one of the most valuable business metrics to track within a yard is truck turnaround time. That is, the time difference between a delivery truck returning to your yard, stopping to unload returns, loading and securing the next delivery, getting all appropriate paperwork for customer confirmation and sign-off, and expediently leaving. I have worked on projects where the average truck turn time (averaged overall trucks in the fleet) was as high as 180 minutes (3 hours!), and many other times wasn’t even known except for a “best guess.” Both of these answers are not only expensive, they’re avoidable.
How do you start attacking turn-around time? Let’s address each obstruction/bottleneck described with examples of practical solutions, and then look at a dealer who studied their truck turn processes and has benefitted from lower turn times over a two-year period.
1. Optimize your yard layout for both product and truck routes.
Develop an overview of your yard in its current state, placing major product families/ groups onto the layout, and indicate the flow of trucks, customers (for customer drive-through and pick-up operations), and vendors. Do the routes overlap, with everyone getting in each other’s way, or are there distinct paths for delivery trucks, vendors, and customers? Are the highest-velocity products (the products that move the fastest, in the highest frequency) stocked in the most convenient locations relative to where the delivery trucks park for reload? Are backstock/overstock locations either immediately above stock locations if racks/shelves are in use, or organized elsewhere for quick identification and retrieval?
Figures 1 and 2 depict a “before” and “after” yard layout for Zarsky Lumber in Corpus Christi, Texas. In the “before” state, trucks, vendors, and customers all followed the same general route through the yard, and truck staging/ loading was far from the geographical center of the yard. After the implementation plan is complete in 2021, Zarsky’s “after” layout will have separate paths, which greatly improves safety for customers, and the swap of staging/loading area from the far east edge of the yard to the center of the yard will result in 35% less product travel.
2. Assign the right people to handle truck turns.
Yard personnel have three masters every minute of every day, in this order of priority: (1) provide service/ assistance to on-site customers; (2) pick/stage/load delivery trucks; and (3) receive/unload/put away vendor deliveries. To optimize the truck turn process, evaluate and distribute the yard staff responsibilities and tasks among these three roles. The people in your yard who have very customer-friendly dispositions, which provides a good public face for your company, should have customer service as their first/ highest priority. Deploying some of your staff to focus on picking/staging/ loading first (stopping only when all of the customer service people are attending to other customers), and others to focus first on vendor receiving, will improve the flow of all three processes. For Zarsky Lumber, this re-assignment allows the two teammates who work in their two main warehouses to remain stationed there for the bulk of the day. When they are not directly with customers, they go to their second priority and pick orders, but their orders are generally from those warehouses. That keeps them close when the next customer arrives. Two other people are prioritized for vendor receiving, and the vendor route through the yard is now separated from both customers and delivery trucks, which increases receiving efficiencies. Finally, the remaining personnel focus first on picking orders. With the loading zones moved to the geographic center of the yard, everyone can have a separate area to pick product and still be equidistant from the loading zone. This results in much faster turning of order picking.
3. Develop and execute standard work procedures.
With clearer definitions of both work assignments and priorities, best practices can now be developed for customer service, picking/staging, loading/securing, and receiving operations. It’s best to document procedures for several reasons: (1) a document can be the “official” and approved method for performing work; (2) procedures can be used to train new employees (and be tested against those procedures to demonstrate proficiency); (3) to cross-train current employees, to increase coverage for back-filling positions during vacations/absences; and (4) procedures should be routinely reviewed and challenged for improvement.
At Alexander Lumber’s Chicago District, early in the transformation of their three yards from an average of 37-minute turns to what is now 18 minutes on average, the project team shot a video to confirm the procedure of which functions are done by each person involved in the truck turnaround process.
Figures 3-5 are screenshots from that initial video, showing the functions of the primary loader (Fig. 3), who is notified approximately ten minutes before arrival of the truck of which order/orders are to be loaded onto the truck. The loader is also informed which loading box will be used. This allows him to stage the fork truck with the first bundled unit to be ready for placement as soon as the truck bed is open. (Fig. 4) then shows the driver’s role…staying at the truck and as soon as the loading is complete, begin securing the load. The final position for rapid truck turn is a dispatcher, who has the paperwork and any small hardware (such as a box of nails or a tote of joist hangers) and places these materials in the truck cab (Fig. 5) while the truck is loaded.
4. Establish clear lines of coordination and communication between team members.
If you do not have the ability to distinguish between pickers/ stagers, loaders, and load inspectors, and the dispatcher cannot leave his workstation, you can still significantly reduce truck turn time by coordinating and communicating clearly among and between the team members.
If you still have doubts that truck turnarounds are not important, nor are they lucrative to your business, here’s proof: Alexander Lumber has tracked ALL truck turn times since the conclusion of its optimization project in March 2018. The Chicago District reduced average truck turn times from a 37-minute baseline down to 18 minutes. Over a two-year period, this translated to 2,655 more hours on the road!
I strongly recommend that if you have not already embarked on your journey to reduce truck turnaround time in your yard, please use the pointers in this article as a guide to get you started on the road to more efficient processes and a stronger bottom line.
Scott Morrison is the president/owner of Scott Morrison Consulting, LLC, which works with LBM dealers (many with accompanying manufacturing facilities) across the U.S. to teach them how to identify and systematically reduce and eliminate waste in their processes. Learn more at s-morrison.com, or email Scott@s-morrison.com.