By Steve Arendt
o The situation: Four men are in a truck and driving around for 20 minutes lost.
o The Cost: $36- The math is easy. 20 minutes multiplied by 4 men is 80 minutes (1hour and 20 minutes). Average cost per hour per employee is $18 per hour. Total cost of being lost is $24.00. Oh but it is not simple! That is 20 minutes that now puts the crew behind for the day. So guess what, you have to get all of the jobs done for that day. You may be paying 20 minutes of overtime if they cannot catch up! Normal overtime is time and a half. $24 multiplied by an additional 50% just to get the scheduled work done adds another $12. So total additional cost is $36 (the original $24 plus the additional $12). AND consider that this can happen multiple times in a day! Oh yes, and it can happen again the next day!
o The Solution: At the very least make sure each truck has an easy to read city street guide. Make sure your drivers know how to use it! Better yet buy a couple of hundred dollar GPS system, teach them how to use it.
Keep in mind that the solution is a system. This system does not cost you much and is so simple. Additionally, you put more money in your pocket. Consider this each time your crews got lost it cost you $36. How many times did this happen is a year? By eliminating the cost you are adding the savings to your pocket. Over the course of a year, it can be easy money.
As owners or managers we tend to not notice these seemingly trivial recurring costs. Every company has them hidden away. Taking the time to notice them and correct them can mean that you work less and produce more money.
This is not rocket science. My hope is that you did take the moment to start thinking about reoccurring cost in your company that you can easily stop. Take a moment to watch my story on how I learned the hard way. Watch the video “for tent rental owners”
Have you any experience to add? Please share your experience below.