MARCH/APRIL 2007
It’s easier than ever to know the whereabouts of containers, trucks, and drivers with hand-held devices that work with bar codes, global positioning systems, and scrapyard operations software to lighten your logistical load.
BY THEODORE FISCHER
Where are my drivers? What’s taking them so long? What are they doing to my trucks? And, most important, where in the world are all my containers? To find answers to these and life’s other persistent questions, a growing number of scrap companies are turning to container and fleet tracking systems.
Tracking systems basically consist of mobile devices with communications, global positioning system, and bar-code scanning technologies that connect to a proprietary software system a company can tailor to its unique needs. Scrap companies use such systems to keep tabs on containers and drivers, who use the devices to electronically check in with the home office when they begin and end their workdays, drop off or pick up loads or containers, or perform any other business function.
Knowledge is power
Tracking system manufacturers tout their products’ potential to increase efficiency and reduce or better manage costs. They can dramatically decrease the amount of paper in the dispatch
office, not to mention the staff time required to process it.
“One client that used to have two full-time people dealing with nothing but driver paperwork is down to one part-time person now,” one vendor says. That company’s end-of-the-month consolidation, which “used to take two people from three to four days now takes one person about half of that,” he says.
Tracking systems can speed the creation of work orders and commodity inventories, give drivers and dispatchers instant access to customer information, and help them optimize routes and container placement.
“The ‘killer app’ for scrap companies is around [the] visibility of containers,” says the CEO of one tracking system firm. “Knowing where their assets are deployed—and being able to redeploy a container versus having to purchase a new one—is the biggest issue.”
At River Metals Recycling LLC (Louisville, Ky.), which introduced a tracking system nearly three years ago, each driver hits an “enter” button on a hand-held computer each morning to
access a schedule the dispatcher prepared the previous night. The schedule indicates the locations and numbers of containers the driver must pick up and deliver. At each delivery or pick-up point, the driver scans the container’s bar code to verify that it’s the correct one.
“Each time [the driver] does a movement and a placement, the system updates itself and shows the container at the new location or back in our yard,” says Steve McQuinn, RMR’s transportation manager. The system “gives you an aging report so you can see how long a particular box sits at a customer—which helps you immensely in controlling your inventory,” he says.
Many systems also collect detailed data regarding drive times and routes. “We can actually look at a driver [record] and tell how fast he’s going and what direction he’s heading, the time he stops, and why he stops—which really helps you pin down your costs for transportation,” McQuinn says. Drivers also can enter information about fuel purchases into RMR’s system for fuel-tax reporting. The system automatically records the relevant state line-crossings.
Without such detailed data, some companies just average their transportation costs and charge each customer a set amount per load. “That does a disservice to some loads and makes some people look profitable when they’re not,” a vendor says. “To know their transportation cost, you have to know the cost per mile and the cost per hour of operating that vehicle. You need to know how many miles the [driver] went and how much time it took to do each load”—all information a tracking system can provide.
Any tracking system is likely to encounter some initial staff resistance. “That’s the natural response, the human response—just like when everybody found out that somebody at the corporate office could read your e-mail,”
McQuinn says. “But most of our drivers love it now. They hardly have any paperwork at all. They just drive.”
McQuinn touts a few more system benefits as well. When people call to complain that one of RMR’s drivers has just run them off the road or they got hit with a piece of scrap, the system helps the company determine whether it was actually somebody else pulling trailers or containers labeled with the company name. “Plus, it has made drivers more safe,” he says. “A lot of them get into the habit of sticking the truck in gear and going down the road. But the system watches them, and it has helped them become better drivers.” It also has helped the bottom line by reducing average driver workdays by about two hours.
But beyond greater safety and efficiency, the best reason for implementing a tracking system, users say, is to keep your customers satisfied. “The driving force was to improve customer service,” says Tom Wilkiel, fleet operations manager of the Midwest division of Metal Management Inc. (Chicago), which installed a system about a year ago. “I needed to know where the drivers were along their routes within a day. [That way] if they’re not going to make a stop, or if they’re going to get to a customer later than expected, we can either make adjustments and give the stop to a different driver or just let the customer know.”
Technology options
Manufacturers of scrapyard operations management systems often sell tracking systems as add-ons to their own or other vendors’ software, though some are stand-alone products. The systems vary in the information they collect, in how much they can integrate with existing management software, and in the hardware drivers use to collect and relay data, usually sturdy hand-held computers or cell phones. The devices’ durability is ranked according to their ingress protection, or IP, rating, an international standard of protection against dust and moisture.
One popular system consists of rugged, Windows-based Pocket PCs equipped with bar-code scanners. The scrap company loads the system with the ID numbers of drivers, trucks, and containers, which have bar codes either etched into their sides or applied as stickers. As they work, drivers can enter information into the computer via scanner, keypad, or touchpad, the latter allowing the collection of customer signatures.
With mobile phone service, the hand-held computers can have both voice and data wireless communication capabilities via WiFi and Bluetooth. The most advanced WiFi-enabled computers have voice-over Internet protocol capabilities so drivers can use them to make phone calls over the Internet. All those real-time communications options mean that drivers can work with dispatchers to update itineraries and relay handling details on the fly. “And when we’re talking about scrap, there are generally a lot of details about how you have to handle something, such as government regulations about safety and security,” the manufacturer says.
One scrap company uses its tracking system to beam information about the weight and contents of a container directly into its scale software system, indicating that truck X on trip Y hauling container Z is on its way back to the yard. “They no longer have trucks lined up across the highway waiting to get onto the scale,” the manufacturer says.
Such detailed data collection and integration comes at a cost: One vendor estimates that even relatively small scrap companies should be prepared to pay $60,000 to $70,000 for a hand-held computer-based tracking system, including the tracking software, a device for each driver (at about $1,500 each), possibly new computers for the office, and training. Additional costs include nominal yearly maintenance fees, network charges, and GPS service.
RMR considered its cost for a system to track its 105 tractors, 600 trailers, and 1,600 containers “actually pretty reasonable,” McQuinn says, “and we have more than paid for it in the reduction of [driver] overtime and finding equipment—and I’m not exaggerating here—that had been missing for years.”
Another hand-held computer-based tracking system—an add-on to one vendor’s operations management software—uses Palm Pilots with built-in scanners to keep tabs on containers and driver movement: mileage, travel time between stops, time spent and activities undertaken on the customers’ premises, time in yard, plus delays and other problems. The industrial-strength
devices and optional portable printers—for creating customer receipts and other documents—cost $1,000 to $1,500 per truck.
Phoning home
Another, somewhat less expensive approach to fleet and container tracking uses cell phone technology. “We track heavy equipment and provide proof-of-delivery and chain-of-custody information with regard to the logistics of moving scrap from one location to another,” explains the vendor of a cell phone-based system. “Then we integrate the data that gets captured in the field about who was doing what, where, and when into the scrap company’s existing system of record.” This tracking system can also record the condition of containers and indicate whether any of the equipment needs to be serviced.
Some systems collect data with barcode scanners attached to “ruggedized” cell phones, which can mean anything from phones with rubber grips that aid in handling and offer some cushioning from drops to those that meet a certain IP standard. Others offer scanners that operate with any cell phone or calling network, on either Java or Microsoft platforms.
OmniSource Corp. (Fort Wayne, Ind.) uses a cell phone- and scanner-based system to track more than 200 trucks and 9,000 containers and trailers. The system “accomplished our goal of real-time container and trailer tracking, and the scanner was compatible with the cell phones that our drivers were already using,” Michael Moran, vice president of transportation, said in an OmniSource press release. “This eliminated the need for our drivers to carry yet another piece of equipment.” Moran estimated that the tracking system saves OmniSource more than $100,000 a year in equipment purchases.
One vendor asserts that cell phone/scanner tracking systems offer clients many of the benefits of a hand-held computer-based system at a lower cost. “Typically, buyers have to choose
between a higher-end, higher-cost, higher-time-to-develop custom implementation and what I would call a low-end, location-based service that provides visibility as to where something is but no additional information about who was doing what and when,” he says. “We’ve hit a sweet spot where, for a cost comparable to what’s been available on the low end, we provide the customization, flexibility, and completeness of the high-end solutions on an outsourced basis.” This system is sold as a monthly subscription of $30 to $60 a month per unit, plus a one-time charge of about $300 for the scanner attachment.
Other, even less expensive cell phone-based systems eschew scanners for tracking containers and involve no proprietary software. Their focus is primarily on increasing driver and route efficiency. Drivers carry GPS-enabled mobile phones that automatically track and record their location. “You don’t need to install any special software; the only software is on the phone itself,” a vendor says. “You simply log into our Web interface on any PC connected to the Internet and see exactly where that phone is on a detailed map.” This system can also produce electronic timesheets: Drivers log into the system each morning, and the phone sends a data stream over the wireless network back to the server showing when and where the driver started the shift and additional location stamps at each stop along the way. The system can relay specific data related to each job, such as order numbers, pick-up numbers, and weights.
This type of service, often sold by cell phone providers, involves minimal up-front costs and generally does not require a long-term contract. Monthly costs, as part of cell phone service, range from $12 to $16 a unit plus about $10 for the cell phone provider’s data plan. “A company can pick up three or four handsets for a test, sign up for the service with negligible up-front costs,” and determine its return on investment, the vendor says. If the numbers are good, it can add more phones.
Tracking system tips
Vendors and tracking system users say that regardless of which tracking system you choose, make sure you allot sufficient time and resources for training everybody who’s going to use it.
“We spent a lot of time focusing on the drivers because that’s where we felt like we’d have our biggest problem,” McQuinn says. “But the drivers, believe it or not, picked it up quickly, in a couple of days. The persons that we didn’t think about were the dispatcher and the coordinator,” he notes. “They needed a good couple of weeks of using the system before they fully understood all the capabilities that it had, so that the data I was looking at from the manager’s side was accurate.”
Also make sure vendors understand exactly what kind of industry they’re dealing with. “People from outside the scrap industry don’t realize how tough it can be—tough on equipment, tough on people—and if you’re not careful, you can get a nice system that won’t be adaptable because it can’t survive the environment,” Wilkiel says. “For example, we bar-coded our containers and had a difficult time with the scanning mechanisms because they were constantly getting dirty. [Vendors] have to understand what it’s like in a scrapyard. It could be paved and everything else, but you’re still dealing with scrap.”
Coming soon
The future of container and fleet tracking technology promises many exciting new wrinkles. “There’s always a lot of pressure for [technology that’s] smaller, faster, more well-featured and well-equipped,” a vendor says.
New equipment might resemble “smart phones on steroids, with a digital camera that can take pictures and read bar codes—not instantly, but in three to five seconds, which is fast enough for the scrap industry,” a vendor says. Or systems might be capable of remotely diagnosing driving techniques. “Companies will be able to see how long drivers are idling, braking hard—all the stuff that quickly adds wear and tear to the vehicle and uses up fuel, a big commodity these days,” another vendor says. Tracking systems also could monitor trouble codes that get tripped within the engine’s computer to anticipate engine problems that visual inspections might overlook.
As prices come down, the scrap industry also will most likely begin using radio frequency identification, in conjunction with GPS technology, to relay real-time information on the exact location of containers. “Especially in today’s environment of heightened security awareness, companies will want to know exactly where their assets are at all times—not just when they arrive or leave the dock or the yard,” a vendor predicts.
But the most vital container- and fleet-tracking elements are available right now, and for a price even small scrap firms might be able to absorb. “Most people don’t realize the capabilities we’re offering and the price points at which we’re offering them,” says one vendor. “People put up with not knowing—not knowing where a container is, not knowing whether something’s been delivered, not knowing the movement of goods and services—and they don’t need to not know anymore.”
Theodore Fischer is a writer based in Silver Spring, Md.
It’s easier than ever to know the whereabouts of containers, trucks, and drivers with hand-held devices that work with bar codes, global positioning systems, and scrapyard operations software to lighten your logistical load.