By Steve Cubbage, VP Farmobile Services & CEO Record Harvest
Let data begin the roll to better fleet ROI
Did you know that data can cause a “snowball roll” — one with a tremendously positive impact on an ag retail fleet’s bottom line? Well, get ready for a good news data story!
The ugly truth in the ag retail world is that “fleet efficiency” sometimes gets lost in the heat of the battle for the sake of “getting it done” in the field.
True “fleet efficiency” is, often, more of an oxymoron (or wishful thinking) than it is a reality.
Baseline agronomic and machine data shows that, on average, most individual machines in an ag retail fleet spend only 25-35 % of their time actually working. The other 65-75% of the time is spent idling, transporting to the field, or turning in a field. That costs ag retail fleets money (and drag on equipment depreciation).
Implementing data collection technology that actively monitors key fleet metrics — like working time, transport time, idle time and in-field turning time — can be economic and operational game-changers for ag retailers.
So, how do you begin collecting the right kind of data to convert idle time into real dollar savings? I recommend two steps.
Step 1. Get a handle on idle time
It starts with diligently monitoring idle time — preferably with real-time data collection and insights.
Idle time is the lowest hanging fruit to pick when trying to improve overall fleet efficiency. With idle time percentages ranging in the 30 – 40% range on most machines (and some even higher), this is certainly the easiest place to start changing behavior across a fleet. It could be as simple as being more conscious about simply turning off the ignition key when refueling or realizing that additional tender trucks are needed to keep machines working in a field.
The point is, if you don’t know the real cause; you’re guessing and operating blind.
Idle hours cost real money. That is, an “idle hour” depreciates and costs just as much as a working hour when it comes time to trade-in the equipment for a new purchase or lease.
Farmobile’s real-time data collection technology helps ag retail managers gather agronomic and machine data across a mixed fleet of applicators and tender trucks. The real-time functionality not only helps fleet managers and dispatch see machines working in the field at the same time for better logistics; the dashboard, machine utilization reports, historic look-backs and accumulated data by machine, allows customers to view and compare equipment performance and “crack the code” on idle vs working time.
One Farmobile customer proactively tackled this by monitoring efficiencies in real-time on a daily basis and comparing data from the previous year. The result was a 5% reduction in overall fleet idle time, year-over-year. And here’s the real data-to-dollar pay-off — that reduction represented nearly $46,000 in direct savings in fleet operations.
Step 2. Convert idle time to working time
While managing idle time effectively is usually, by itself, enough to pay for fleet monitoring technology — it is small potatoes compared to what that data and change it brings about can set in motion. Idle time is the proverbial “tip of the iceberg” or, in this case, just the beginning of the snowball as it rolls downhill.
Reducing idle time means that it can be converted into something more productive — working time!
That’s when the snowball really picks up “positive speed” with more acres covered per day and more acres covered per hour. Saving money is one thing, but creating more profitability by adding-back hours that you lost, or converting idle time to working time is money. And that’s the true tipping point.
For one of our customers, the process of shifting idle time to working time resulted in nearly 25% more acres covered per total hours logged. The snowball effect was nearly a six-figure shift in additional income.
In this customer’s case, the cumulative effect of increased working time led to fleet efficiency and the ability to eliminate five machines from the overall total fleet — YET the customer still covered more acres. What this means is the five machines will not be replaced thus freeing up working capital for other parts of the business. (Replacing those machines with new ones would have required over $2 million in depreciable capital assets.)
Start a snowball
The simple truth is, you can’t monitor what you can’t measure. Data drives fleet efficiency. Start there.
Agronomic and machine data collected across your entire fleet, in real-time, will start your own snowball effect — first, with logistics and then small wins like reducing an hour or 2 in idle time per day. And then watch it gain speed because data will tell your own fleet performance story resulting in more acres covered in a week and a leaner, meaner fleet at the end of the year.
And when it’s all done it means data did its job to put your business and fleet in a better position year-over-year.
Isn’t it time to start building your own snow ball… now?