A STITCH IN TIME

Distribution executives agree that staying on top of small equipment concerns will make the big problems, which cost big money, go away. Increasingly, these preventive maintenance programs are being handled with a variety of automated systems."Preventive maintenance reduces overall operating costs and gives better up-time to equipment," said Mike Halliday, manager of maintenance and engineering for

Distribution executives agree that staying on top of small equipment concerns will make the big problems, which cost big money, go away. Increasingly, these preventive maintenance programs are being handled with a variety of automated systems.

"Preventive maintenance reduces overall operating costs and gives better up-time to equipment," said Mike Halliday, manager of maintenance and engineering for warehousing at Schnuck Markets, St. Louis.

In addition to their primary job of keeping materials-handling equipment up and running, some automated systems provide detailed data that gives managers the ability to compare equipment performance and longevity, making activity-based costing efforts achievable.

Figures such as cost per operating hour can be used to justify new equipment purchases or decide that maintaining existing equipment is a more cost-effective option.

Such systems also bring cost savings by alerting managers about warranty coverage. In addition, by identifying who is using what piece of equipment, the systems can point out employees who may require additional training.

"The most useful aspect of these systems is helping you identify when to replace pieces," said Ray Gooding, facility manager for Associated Grocers, Seattle. "They can also track your parts inventory and conduct a replacement analysis."

At Associated Grocers, a system using bar-code readers is employed to track mechanics' time, as well as repair costs, batteries, chargers and the truck fleet. Maintenance procedures, intervals and scheduled checks are included in the program as well.

Schnucks is currently employing a handheld system that reads bar codes on all equipment and parts. The wand scanner and notepad hardware enable the operator to time the amount of work being done on each piece of equipment in a paperless fashion. "The more paper reduced the better," said Halliday.

Parts are also included in the system's inventory-management capabilities. "We have a history of our stock -- what we need and what we have -- so that we can have the specific parts when they are needed. If we had one consistent failing before the system was put in place, it was in recording parts," Halliday said.

Schnucks has also captured savings with its system in helping to identify part failures. Through more automated record-keeping, Schnucks was able to identify that a steering shaft was not performing up to expectations.

After alerting the manufacturer, it was learned that the steering shaft was softer than was needed for the particular function it was being used for. With the problem identified, it was corrected.

Detailed cost and usage data is also helpful when distribution executives present their cases to top management, sources told SN. "A lot is done for the stores, but the warehouse is an industrial environment that is not understood," said Halliday.

"You have to sell senior management on the needs of equipment with finances and hard numbers," said Associated Grocers' Gooding.

Day-to-day upkeep of vehicles and equipment, along with regular preventive-maintenance programs, are of critical importance to retailers and wholesalers because they operate high-volume distribution centers with compressed delivery time tables.

"We have limited equipment that can be put to work for substitution," said Gooding. "We need to operate fully and maintenance helps us keep our efficiencies."

"If forklifts don't run, we can't move groceries," said Warren Frank, manager of warehouse productivity and equipment at Nash Finch Co., Minneapolis. "If not managed, this big cost center can become a pit."

Warehouse managers report that the maintenance systems themselves require frequent upgrades.

At Associated Grocers, the computerized maintenance-management system is operating off a mainframe computer. With the year 2000 on the doorstep, the wholesaler is ensuring its system will be Y2K-compliant. A PC-based, stand-alone system will be implemented.

Another function that maintenance-management systems can offer is tracking employee training. These systems enable warehouse managers to examine which operators have what certifications, and helps identify when additional training may be in order.

The information gleaned from the system at Nash Finch is used to compare performance and productivity from warehouse to warehouse. When differences are noticed, managers can delve into solving problems, which can range from inadequate floor maintenance to forklift damage to training issues.

"We are starting to be able to analyze data that wasn't kept at all or was not able to be read on paper," said Frank.

Associated Grocers is able to extrapolate a cost per hour or a cost per month on each piece of equipment along with damage costs. This data has often isolated a training issue.

"Breakdown reports can isolate operator problems," said Halliday.

"We send our mechanics to the equipment manufacturer for training on new equipment pieces and new systems," said Gooding. "We want our operators to know how to efficiently and safely run the equipment and this training is essential."

Maintenance becomes even more crucial because many distribution executives, lacking corporate funds for major capital purchases, use equipment longer than its recommended life span.

"The average life expectancy for power sweepers is four years, but my newest power sweeper is 11," said Schnuck's Halliday.

Maintenance tracking also keeps a check on safety issues. Properly functioning equipment reduces accidents in the warehouse and boosts the distribution center's efficiency.

Another key issue is ensuring that a maintenance-tracking system will actually be used by employees. Nash Finch employs a PC-based system in its facility-maintenance shops, which are generally staffed with only one or two people. The system has to provide ease of use for reporting schedules and equipment down times.

"Most other systems [are designed for] departments with clerks," said Frank. "We don't have them with such small shops. The real value in our people is in their ability to fix a forklift, not input data into a computer. We needed a system that took minimum time inputting data so that chances are high that the data will actually be entered.

"Preventive maintenance is crucial," he added. "The Occupational Safety and Health Administration requires certain procedures be done every day by each operator. Checks are made to make sure the piece of equipment is safe to operate. There are also standards for checks to be made at regular intervals."

"In the event of an accident, generally equipment failures are examined first," said Halliday. "Preventive maintenance helps little problems not become big ones. With constantly moving machinery you have to keep on top of it."