Smart Material Handling: A Contractor and Integrator’s Best Friend


Take a moment and think about the supply bins you have within your warehouse or on a job site. You may have a technician periodically check your bin inventory levels. When items are running low, that technician goes into the warehouse or truck and replenishes the bin.

Thinking about efficiency, there’s time spent to actually check bin levels, determine replenishment needs, and then go into the warehouse or truck to grab replenishment items. (And that’s assuming the items are where they are supposed to be.) Only then can bins be refilled, accordingly.

 What if all these tasks could be done in a “smart” way?

What if your bins were “smart,” meaning that they were equipped with sensors automatically telling you what item is taken and when pre-determined inventory levels were low, needing replenishment?

A smart bin could automatically send out an order for the specific items needed and at the specific amounts required. How much time would that save you? Considering the many jobs you may have going on at one time, the time savings and labor efficiencies become significant.

Smart Material Handling Services and How They Work

Smart material handling is a cost- and time-efficient way to maximize profitability by significantly increasing workforce productivity. On larger jobs (those lasting a week or more), there are a number of material handling tasks that come up again and again, including: 

• Restocking critical items within your supply bins
• Searching the warehouse for hard-to-find key items from which your truck inventory is restocked each day
• Going on supply runs to fulfill inventory that is out of stock

Time loss is the common denominator in all of the above. Time is money.

While these tasks are all important to your overall success, contractors and integrators often pay technicians for tasks that don’t include actual installation work. It only takes a few minutes to restock a truck or job bin. Someone has to make a supply run to your local distributor when you run low, or worse, run out of important day-to-day inventory. Taking a look at this, you might find that a significant amount of time is spent on non-revenue generating material handling activities.

The Value in Smart Material Handling

Labor efficiency improvement is the core value proposition of smart material handling. By providing the right materials at the right time, delivered in full, possibly kitted or even pre-assembled, the time spent on material handling can be significantly reduced. The result is enhanced workforce productivity.

Although this may seem like an obvious benefit, it often requires changes in the everyday habits and practices for the contractor. Therefore, it may not appeal to every contractor or integrator. But it is very important to strategic, growth-oriented, professionally managed firms.

Seeing the Technology in Action

According to many contractors with whom we have spoken:

• Installation techs can leave a job site, on average, 2.5 times per week to look for parts
• 
The average cost of this lost time can be as high as $250 each time
• 
Installers typically go to the closest venue to buy these parts at a premium price instead of a supplier with optimal terms and pricing
• 
If the part cannot be found locally, it has to be ordered
• 
Rarely does a contractor track these “spot buys” or “shipping costs,” adding them back into the end-users’ BOM and charging them accordingly

A study by Dr. Perry Daneshgari, President and CEO of MCA, Inc., showed that the average electrical tech spent only 15 hours per 40 hour work week actually doing installation work and 16 hours on material handling. Daneshgari says, "The number one cause of delay on a job site is waiting for material ... before it can even be handled!"

Smart Material Handling Across Your Organization

Other material-handling areas like job safety materials, part pre-assemblies, “A” inventory items and maintenance-repair-operations (MRO) materials all stand to benefit from smart material handling.

Smart material handling means that job bins, warehouse inventory, job trailers, and the like can all self-monitor. They can: 

• Call for new inventory
• Monitor what is taken and when
• 
Provide access control via job badges

Additionally, smart material handling services can provide real-time usage reporting, allowing you to track and manage your materials up to the minute.

Material Management Technology Today

This technology isn’t something that may be available in the future – this is what smart material handling services can provide today. Implementation of smart material handling services can be completed in a matter of days or weeks, depending on complexity. Considering the labor efficiency potential, it’s no surprise that smart material management is quickly becoming the contractor and integrator’s best friend.

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