Control truck inventory

 

BY RICHARD P. DiTOMA, L.M.P.

contributing writer

 

As a PHC service contractor, you utilize one or more service vehicles, which you probably stock with common everyday inventory items needed to perform service tasks efficiently. But efficiency is often decreased when the parts and/or tools you thought were on the truck aren’t there when you need them.

 

When you have employees to whom you entrust the vehicle and inventory, and those inventory items are not there, you may wonder if those items just sprouted legs and walked off the truck. Whether the material and/or tools were used on a previous job or were pilfered by someone, the tech still doesn’t have it when he/she needs it.

 

This will cause increased cost to you for the job the tech is doing at the time it is realized that some tools or material are missing. Extra fuel cost, extra labor cost, and lost time that could have been used to do another job — which would bring in more revenue to your business — are some of the additional expenses that you will incur with an improperly stocked service vehicle. The cause of the problem is simple. It’s poor inventory control. The solution to the problem will create a bit more administrative work, but is also simple.

 

Make a truck inventory list

 

Make a truck inventory list of the material and tools you use most often. Stocking items on the truck that just sit there in case you might need them, but seldom do, has an unnecessary cost to you. The weight alone causes you to use more fuel to drive the truck. Additionally, material can become truck-worn. In that instance, you would have paid for the material and not received a benefit for the cost to you for that material because it is not marketable.

 

As a phc contractor, you would want to stock items on the truck such as traps, tailpieces, slip nuts, washers, supply tubes, compression nuts and rings, wax seals, water closet bolts, valves, thermocouples, zone valves, circulators, diaphragm tanks, water pressure regulators, air vents, refrigerant, fittings, tubing, pipe, acetylene, solder, flux, pipe sealant, and the tools to perform everyday tasks, etc.

 

To determine which items to stock, ask yourself if any item you are considering to stock on the truck will be used in a year. If the answer is no or probably not, that item doesn’t belong on your truck inventory list. Those items that are not on the list can be picked up at your local supplier or your shop when needed. If you are in a rural area where suppliers are few and far between, you might expand the list to items you could possibly need to take the scarcity of suppliers and distance to your shop into consideration. But to be certain you’re not wasting money, make sure you use common sense.

You also must choose the quantity of each item you want to stock on your service vehicles. For instance, I would suggest for common replacement items such as tubular p-traps that a minimum truck quantity would be three. After all, a one-family home with 11/2 to 2 baths could use all three p-traps at one service call, one for the kitchen sink and one for each lavatory. You might well consider six.

 

Some items are seasonal. An item such as a circulator for a hot water heating system certainly does not require six, especially in the summer. Two or three would probably do during the heating season. If you find that you need more than the quantity you have chosen for any item, just increase the quantity of that item on your list. Similarly, if you find that you don’t use as many of an item for which your list calls, decrease the quantity on the list.

 

Use the list to control inventory movement

 

Making a list and not using it correctly will not only waste your money, it will waste your time and it controls nothing. Correct implementation of the inventory list requires the following steps:

 

1: Once your list is made, you, or your supervisor, should meet with the technician assigned to each truck and check that the list and the inventory on the truck match. Once the supervisor and technician agree that all the material on the list (and only the material on the list) is on the truck, the technician should sign the supervisor’s copy of the list to indicate that the tech has received the inventory. That puts the burden on the technician to prove why any material may be missing.

 

2: The technician, including yourself if you are one of your technicians, should list every item he/she uses on each job. You should have the tech do it on a form that shows the job name, invoice # and date for which the items were used. This will allow the technician to prove why any items are not on the truck at all times.

 

3: The technician will turn in the form each day to the supervisor to have his/her truck inventory replenished so that the vehicle can be properly stocked for the next day.

 

4: You or your supervisor can then give the tech replacement material for that which was used that day so the truck will be ready for the next day. For the company records, you would then take the form and have the tech sign it to prove the tech had received all the material requested. If any item is not replenished at that time, the supervisor should issue a form to the tech indicating that the item has been back ordered. This will allow the tech to prove why the material is not on his/her vehicle. Once the back ordered material is given to the tech, the tech signs the back order form indicating the fact that he/she received the back ordered material and gives the form to the supervisor.

5: Conduct surprise inventory checks. Your staff will be cognizant that you are on top of things. This, in turn, will give them reason to be the best they can be regarding truck inventory. And you will be able to maintain properly stocked service vehicles.

 

6: In the instance of damaged material or tools, the tech must return the damaged material and/or tools at the time he/she is requesting replacements of same.

 

7: The supervisor in charge of inventory should keep all records of inventory so that he/she can be certain that in house and truck inventory coincides.

 

8 (optional): Some phc shops may require technicians to supply their own hand tools. The theory is that techs will take care of that for which they must pay better than that for which the business must pay. It would be wise to allow an annual dollar amount to be given to the tech for hand tool use. The amount would be determined by the size of the hand tool inventory required by the administrators of the business. This will give the tech the financial ability to keep his/her hand tools in good condition so that he/she can perform their assigned tasks efficiently. Your supervisor should check all hand tools for condition at the time of any surprise check. At the end of a fiscal year the tech will receive the hand tool compensation dollar amount. A tech who keeps his/her tools in pristine condition is then rewarded for his/her efforts. They can keep the full dollar amount. Techs that persist in using screwdrivers as chisels, or that just don’t realize how to care for their hand tools, will be able to replace the hand tools in question with the compensation, but, are not rewarded as well as those who keep hand tools in good functional condition.

 

9, (optional): Another possible incentive for techs to have excellent inventory control would be some type of reward for passing those surprise inventory checks with flying colors.

 

I hope these ideas help you control your truck inventory. For my assistance or other ideas that can help you improve your business protocols, give me a call at 845-639-5050. As always, be well and be prosperous.