Is yard management important? It is a question that I ask on many occasions and, depending on whom you ask, you could get a response similar to the ones below:
1) Yard Management is not important enough to invest the time/money/resource in.
2) Yard Management is important but it is not a priority at the moment, we have too much else to do.
3) Yard Management is probably more important than we know, we just can't prove it to the powers that be.
4) Yard Management is vital; we could not run our business without it.
So, I decided to write this blog and ask you some questions to see if yard management is actually important or not.
Given our current economic context, every business that has a supply chain operation has looked at the warehouse operation and transportation fleet to see where costs can be saved and/or efficiencies improved. How many of these companies have looked at the yard in the same way? Not too many in my opinion. Why is that?
Yard Management is the invisible link between the warehouse or cross-dock and the transportation fleet. It is the last "yard", so to speak, between these two operations and unfortunately is not always an integral part of a supply chain operation.
Now, if I told you that there is money to be saved by implementing yard management you would immediately think "of course he would say that, he sells yard management" which is a fair point. But let me give you some food for thought.
Benefits and Payback - "what is the ROI?"
To be honest, this is the toughest question to answer because every business is different. But, there are a number of things that should be considered when looking at ROI.
Shunter costs: i.e. fuel, maintenance, lease costs, and the driver(s).
Do you know what you spend on this? What would a 13% or 22% saving be to your operation? What would the impact be to your business if you could get 2-3 more moves an hour/per shunter? Yard management has proven to improve shunter efficiency by 29% to 38%. What impact would this have on your company's bottom line?
Trailer utilization: how quickly can you ‘turn' a trailer from inbound to loaded and ready for dispatch?
How much time does it take for your business to gate-in and gate-out a trailer, 4-5 minutes or more? What would you do if this could be 20-30 seconds? How many trailers could you eliminate from your operation? Would you need to rent/lease trailers for peak trading periods? Yard management and dock scheduling could reduce the number of trailers your business needs to meet today's operational requirements by 3% - 11%. How much could you save?
All of the above are immediate, quantifiable and tangible benefits. Real money!
However, I believe the above is only half of the benefits available when implementing yard management. In my next posting I will discuss some of the success stories that companies have had by extending visibility past the four walls of the warehouse. These benefits are usually substantial and are often difficult to predict.
Judge for Yourself
In the meantime if you would would like to have a demonstration of how a yard management system could provide value in your operation. Please contact us for a brief web demonstration of C3 Yard Smart.