Warehouse Floor Repairs for a Solid R.O.I Underfoot

Transcription

1 Warehouse Floor Repairs for a Solid R.O.I Underfoot Presented at the Material Handling & Logistics Conference sponsored by HK Systems at Park City, UT on September 18, 2006 (Track 4, Session 5) Presented by: Steve Metzger President Metzger/McGuire Floor repairs are common sense While preparing his annual budget request for corporate the distribution center manager noticed that his material handling expenses for the past year were up sharply from the previous year. He also noted that productivity per employee was down, despite an investment in some new material handling vehicles. After double-checking his figures he knew he had a problem, but no insight as to what the problem might be. In a meeting with his shipping and receiving managers he asked if they could explain what was going on. Both promptly responded our floor is killing us. This meeting set in motion a process of identifying and correcting floor defects. A year later, while preparing his next budget request, the DC manager was surprised to find that he had already recouped most of the money he spent on repairing his floors with productivity increases and expense reductions. Looking back, he realized that all he did was exercise common sense. Material handling is affected by floor conditions Regardless of the type and size of material handling vehicle you employ, they all have one thing in common; they all run on the floor. The concrete warehouse floor is the work surface for these vehicles. And like any work surface, the ideal one is hard, smooth and interruptionfree. Only when the floor meets these criteria can vehicles and vehicle operations perform at optimum levels. Accordingly, your floor must be considered a vital component of your material handling operation. This document provides support material for an article on Is your DC no longer meeting your needs? Try renovating in Distribution Center Management. Interested readers may learn more or purchase a copy by visiting or phoning

2 All floors are not created equal It is assumed that all new floors will provide an ideal work surface for material handling vehicle. One should not accept this assumption. Regardless of how much effort and expertise goes into designing an industrial floor slab, the actual placement remains as much art as science. Construction quality can be affected by numerous variables including weather conditions (temperature, humidity, wind, sunlight, etc.), concrete mix designs and contractor expertise. And even if all work is properly performed, the slab will shrink in linear dimension as retained moisture evaporates. Shrinkage results in the widening of joints and the potential for random crack development. All floors suffer wear and tear Even the best floors will likely show signs of wear and tear when subjected to the impact and abrasion of hard wheeled vehicles carrying heavy loads day after day, year after year. The most common sign of wear will occur at joints, where hard wheel impact wears away joint edges, a condition known as spalling. In our latest survey of facility professionals 92% identified joint edge spalling as their most significant floor problem. And the one guaranteed fact about spalled joints is that they will continue to grow wider and deeper. Floor problems affect vehicles Just as material handling vehicles can damage concrete floors, floor defects also damage vehicles. The most common damage caused by floor defects will be excessive wheel wear. Rough concrete edges will chew up even hard wheels. If you have sizable defects you can be sure that they account for a large part of your wheel replacement costs. With wide/deep floor defects there will be considerable impact as wheels make contact. This impact results in damage to transmissions, axles and bearings, and the vibration causes electrical connections to loosen. The direct costs of wheel replacement and vehicle repairs are substantial in themselves, but when you add in the cost of vehicle downtime and a shortened vehicle life cycle it becomes very clear that floor defects are an very expensive condition. Floor problems affect vehicle operators Imagine, if you can, driving a hard wheeled vehicle over bumps and ruts for 8 hours a day, 5 days a week. The repetitive jolts are tough on a driver. By the end of the day he is weary and irritable. By the end of the month he is suffering chronic lower back pain. Soon his absenteeism rate rises. He may even quit his job. The costs of floor defects on drivers often go unnoticed until worker absenteeism and employment turnover become alarming, and claims for back injuries make your WC rates jump. By the time these symptoms are noticed you will have lost $thousands. But there are still

3 additional costs to consider. When wheels hit deep ruts the potential for load-tipping increases dramatically. One or two injuries from a load-tipping incident can cause your insurance rates to rise, not to mention the potential for OSHA visits and fines. Floor problems reduce productivity Not all vehicle operators get injured and quit. Some find a way to tolerate the misery inflicted by floor problems. The simplest way to reduce the impact of wheel-hitting-gouge is to slow down as vehicles cross each bump. Another way to avoid the impact is to take smoother detours. Both of these actions have a significant adverse effect on productivity. If a time study analyst were to monitor vehicle productivity in a facility with distressed floors he would likely conclude that defects waste several minutes of each driver s shift. Multiply this times the number of drivers and the number of shifts and your annual costs would surely be in the $thousands. And each year the financial loss will increase as defects grow in severity. Floor problems and sanitation Floor defects add to housekeeping costs because they become repositories for dirt and debris. Dust from deteriorating floors can be air-carried to goods on the shelf and in transit. Few scrubbers are capable of removing foreign material from recesses. Floor defects pose even more significant headaches for the food, beverage and drug industries. Scrubbers leave moisture in floor crevices and depressions. This moisture is an ideal breeding ground for mold, mildew, unwanted organisms and insects. Floor defects are very expensive When you take a look at all the ways floor defects affect your operation it becomes clear that they are too expensive to tolerate. Vehicle wear and damage + Vehicle downtime + Shortened vehicle lifecycle + Worker absenteeism & turnover + Higher WC and insurance rates + Worker health & safety + Reduced productivity + Housekeeping & sanitation = REDUCED PROFITS

4 Why floors don t get repaired If repairing floors is such a common sense matter, why do few deteriorated floors ever get repaired? Every few years we conduct a survey of facility professionals and ask about their floors. One question we always ask is why don t you repair your floors? The answers we get are always the same: 92% No downtime for repairs 89% Inadequate maintenance manpower 84% Not a corporate priority 78% No money in budget 61% Lack of training/knowledge 53% Can t tolerate dust, water and noise Some of the survey respondents added some insightful comments: My wheel replacement costs are double our company average. HQ is on my back even though I tell them I ve got the worst floor of all our DC s. My vehicles are designed for high speed use, but I can t use them at high speeds because my joints are so badly deteriorated. I couldn t get any budget money for repairs until a load tipped and the driver got hurt. Now I get $4,600 each year for repairs. Lack of downtime for repairs can generally be overcome with today s rapid-set repair materials. Inadequate maintenance manpower can usually be overcome by outsourcing repair work to specialty contractors. And dust/water/noise is seldom a problem with the dry cut, vacuum equipped tools now available. But only corporate can remove the other three obstacles; lack of leadership, budgeting and training. Floor repairs must be a corporate initiative In 40 years of visiting warehouses and DC s it has been my experience that facility-level requests for substantial floor repair funding are seldom granted. In fact, I ve had quite a few facility managers tell me that it s easier for them to get money to buy new material handling equipment than it is to get money for floor repairs. Perhaps it s because equipment is a tangible investment, while floor repairs are intangible. But the irony lies in the fact that new equipment turns out to have a negative return on investment. First, new equipment can never achieve it s promise of higher productivity since it still operates on an productivity-negating work surface. Second, newer and more sophisticated equipment likely carries higher costs for replacement parts and damage repair. No facility manager will turn down on offer of new and better equipment, but the root problem remains.

5 Corporate alone is not always to blame for letting floor deficiencies go uncorrected. Sometimes it is the facility manager who is the barrier. If his bonus is predicated on keeping expenditures below a certain budget point, he may decide to defer floor repair spending year after year. And who could blame him for not wanting his bonus to, in effect, pay for improving corporate property. The only way most floor deficiencies will ever be corrected is when corporate management takes a leadership position and makes floor improvements a corporate priority. Roadmap for a successful program All successful floor repair programs begin with strong, visible leadership at corporate offices. This advocate could be your corporate architect, your property or real estate manager, or even your distribution head. This person should have the power to allocate a reasonable amount of funding, or have direct access to a budgetary decision-maker Here is a template that person may wish to follow: 1. CONDUCT FLOOR SURVEYS Determine the magnitude of your problems by conducting surveys of your DC and warehouse facilities. Start by sending a questionnaire to facility managers asking about the condition of their floor. Conduct surveys of all who indicate a significant level of deficiencies. If you do not have someone capable of conducting a comprehensive survey, retain someone with the needed expertise. 2. ESTABLISH REPAIR STANDARDS By analyzing the problems identified in your surveys you can determine the types of defects you will need to repair. Then draft guidelines on standard repair procedures and materials. This will also help determine what equipment (saws, etc.) is needed to properly execute the work. Draw upon the expertise of consultants, specialty repair contractors or repair material manufacturers in setting standards. Every facility should have a floor maintenance manual as a resource. 3. IN-HOUSE OR OUTSOURCE? Your surveys will tell you whether repairs can best be handled by your maintenance departments or by outside contractors. The answer will likely vary from facility to facility. If you need outside contractors seek only those who specialize in the repair of industrial concrete floors. Credentials, manpower, proper equipment and the ability to work around day-to-day operations should all be considerations. 4. DETERMINE BUDGET(S) Determine the likely budget needs for each facility. You can do this by using unit prices for in-house performed repairs (repair material manufacturers are often helpful), or by soliciting bids from your pre-screened contractors.

6 5. PRIORITIZE, FUND & IMPLEMENT Set facility priorities by considering several criteria: a. Which facility is most critical to corporate profits? b. Which floor appears to be costing you the most in terms of reduced productivity and increased costs? c. Where will repairs give the biggest bang for the buck? Measure results No corporation likes to spend money unless it is assured of an adequate return. It is important for top management to understand that money allocated on floor repairs is not an expenditure; it is an investment in increased productivity and reduced operating costs. You can confirm this by contrasting year to year changes of each item listed in an earlier section of this paper. In a majority of cases money spent on repairs will be recouped within one year. Within two years every facility will almost surely be in the black. Conclusion Ben Franklin s famous quote a penny saved is a penny earned certainly applies to repairing industrial floors. Floor repairs can offer an outstanding ROI, paying dividends year after year. In today s highly competitive environment, can your company afford to ignore this excellent cost saving, productivity enhancing opportunity? So when you are looking for ways to increase your profits, don t forget to look down.