Key Performance Indicators for the Builders’ Merchants Sector

Benchmarking Guide

Acknowledgements
The following builders’ merchants took part in this benchmarking survey and are thanked for their participation:

Travis Perkins Group Wolseley UK Bradford and Sons Ltd Buildbase Ltd Long & Somerville Ltd UGS Ltd The BSS Group Saint-Gobain Building Distribution In addition, the Construction Products Association and Builders Merchants Federation are thanked for their important contributions.

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3 Survey Statistics 5 5 5 6 3 Survey Results 3.4 Number of Drops per Day 3.3 Kilometres per Drop 3.5 Value per Drop 3.1 Number of Runs per Day 3.9 Percentage of Contrained Loads 3.2 The KPIs 2.1 The Nature of the Builders’ Merchants Sector 2.4 External Benchmarking 1 1 1 2 4 2 The Builders’ Merchants Benchmarking Survey 2.11 Time Utilisation 8 8 9 10 11 12 13 14 16 17 17 18 4 5 Summary The Builders’ Merchants Transport Efficiency Road Map 19 19 ii .10 Deviations from Schedule 3.2 Number of Drops per Run 3.Contents 1 Background 1.7 Fuel Used per Drop 3.3 Which KPIs Are Right for Me? 1.6 Fuel Consumption 3.1 Measuring Performance in Your Own Business 1.8 Cost per Drop 3.2 What Should a Key Performance Indicator Be? 1.

how many miles your vehicles run empty or the number of late deliveries you make. Achievable. you will need to be able to accurately measure the resources you use to deliver your services.uk and from the Hotline 0845 877 0 877. can use this benchmarking guide to identify real opportunities to maximise transport efficiency. It aims to: Show participating companies how their own performance compares with that of others Highlight how the best operators in class are able to achieve their ratings Identify recommendations on how to improve efficiency Operators in the sector. comparing like with like. KPIs used in external benchmarking are essential tools for the freight industry to understand and then improve its performance. They provide a consistent basis for measuring transport efficiency across the fleets of different operators.freightbestpractice. 1. A KPI should be relevant and it should also be SMART .Specific. Weekly. Measurable. how much it costs you to deliver products to your customers. considers the delivery activities of builders’ merchants and provides KPI comparisons between the participating fleets. 1 .org. Only then can you identify areas for improvement and assess how effective any operational changes have been. Realistic and Timed.for instance. Producing graphs or charts will often be the best way of showing performance progress. Individual measures and data need to be turned into information that can help you to make decisions. This section is intended to explain the characteristics of useful KPIs that can be applied in various types of operation and by different people. The starting point for any performance improvement programme should be to understand the current performance of your operation. The Department for Transport. However. there are a number of things you can consider beforehand in order to decide which ones may be right for you. instigated by the Construction Products Association and conducted with their help and with the assistance of the Builders’ Merchants Federation. tactical and strategic decisions about your operation. reducing both running costs and environmental impact. monthly and annual reports allow you to monitor progress and see which areas need the greatest improvement. These measures are known as KPIs. through its Freight Best Practice programme. This means collecting data on key aspects of your operation and turning this information into specific measures that can help you to identify areas for improvement .1 Measuring Performance in Your Own Business If you want to make well-informed. This benchmarking survey. A KPI on its own will not tell you much. Already published are KPI survey guides for the following sectors: Key Performance Indicators for Non-food Retail Distribution Key Performance Indicators for the Food Supply Chain Key Performance Indicators for the Pallet Sector Key Performance Indicators for the Next-day Parcel Delivery Sector All of these publications are available FREE of charge from the Freight Best Practice programme website www. This means setting a target and measuring and monitoring KPIs over a period of time to see how your operation performs against this target. has supported a series of benchmarking surveys that have developed a range of key performance indicators (KPIs) in a variety of industry sectors.2 What Should a Key Performance Indicator Be? There are many different KPIs that can be used to measure performance in a freight transport operation and it can be difficult to know which ones might be right for you. 1.1 Background Every successful organisation needs to manage its assets effectively and can benefit from benchmarking its performance against that of direct competitors and those held to be excellent in its sector. whether survey participants or not.

Measurable KPIs can show changes in performance over time. 1. Figure 1 shows a basic step-by-step process for measuring performance. daily delivery drops or nightly trunking volume. If KPIs are specific and kept simple. type and management structure of a company is likely to influence the range of KPIs you might use. KPIs can be used to help managers develop strategy. comparing drivers when they drive vehicles of substantially different age or vehicle type can also be deceptive. such as staff absences in the warehouse. this could be misleading. simple to use and easy to understand. such as rotating drivers onto different vehicles and different routes and then monitoring both driver and vehicle performance.Specific KPIs should be specific. a picture can be provided of how you are performing in terms of revenue and profitability and overall fleet efficiency and in relation to customer service and legal obligations. reliable and consistent. to spot consistently high and poor performers. Similarly. when looked at in combination with other measures. It is easy to fall into the trap of comparing two drivers on different routes for time utilisation or miles per gallon (MPG). Regularly reviewing performance towards targets and then resetting the targets to encourage smaller incremental (but cumulative) improvements may work much better in the long run. The 11 KPIs developed and used by the companies that participated in the builders’ merchants benchmarking survey are detailed in Section 2. See the Freight Best Practice Guides Performance Management for Efficient Road Freight Operations This guide explains the process of measuring performance effectively. as comparison over time forms the basis of benchmarking and then improving performance. For this to happen it is essential to compare like with like data. plan and make decisions. If certain measures are not recorded and presented to the agreed timescales. There are ways you can get around these problems however. Fleet Performance Management Tool This spreadsheet tool is designed to help operators measure KPIs and manage performance. However. It is important that the data required to produce the particular KPI can be collected easily and on a regular basis. Realistic Remember that decisions and management actions will be taken as a result of the data collected and presented. Achievable Any targets that are set should be achievable. An individual KPI can tell you how well you are performing at an operational level. however. while at the operational level they can show clearly the areas that need improvement. the risk of changes in performance going unnoticed rises. It includes advice on how information is best collected and interpreted to allow informed decision making in order to achieve operational efficiency improvements. It may seem beneficial to set high targets in the hope that this leads to greater improvements in performance. they can be easily communicated across the business and there is no need for staff to have an in-depth knowledge of the area being measured. people can become disillusioned when they continually fall short of the targets set for them. If one route is more demanding than the other. The checklist on the following page shows some important questions you can ask to help set up a performance measurement system in your organisation. Complicated statistics and formulae can lead to confusion and uncertainty about what is actually being measured in the first place. or a change in approach. 2 . Weekly or monthly monitoring is recommended for many KPIs but this can depend on the measure and the needs of a particular business.3 Which KPIs Are Right for Me? The size. so the data collection method needs to be realistic. Some information may have to be collected on a daily basis.2 of this guide. Timed The frequency of monitoring is an important consideration.

Figure 1 The Process of Selecting and Measuring KPIs Performance Management Checklist: Select KPIs or Have you reviewed your existing KPIs or looked at those that might be appropriate for your type of operation? Are they Specific. higher targets in the future? Targets too high? No Yes Identify Strategy for Performance Improvement Take Action Implement Strategy 3 . Realistic and Timed? (SMART) Have you set targets for these KPIs? Set and Review Targets Data Collection Do you know how well your operation is performing against your targets? Do you need to raise or lower them? Review/Evaluation (Including Benchmarking) Have you considered external benchmarking to compare your operation’s performance with that of others? Have you reviewed or set up a data collection system to give you the information you need? Reporting & Feedback Do you have a good system in place for analysing and reporting your KPIs? Results Targets met? No Yes Do you use information technology systems to help you? Have you considered actions that can be taken to improve your operation’s performance and meet new. Achievable. Measurable.

enabling you to compare the relative efficiency of your own fleet operation and identify measures that you can take to improve performance. In other words. Throughout this guide you will see charts showing the KPI survey results.Runs per Day Sector Average Individual Depot Unique Number of Each Depot 4 . KPI Figure 2a Heavy Deliveries .1.4 External Benchmarking The basic process of measuring performance internally is extremely useful but to fully understand how your operation compares with that of your competitors. This benchmarking survey guide for the builders’ merchants sector is designed to highlight the performance of some of the best-in-class operators within the sector. This process of external benchmarking will enable you to understand the characteristics displayed by the best-in-class performers across a range of KPIs. you must benchmark your performance with the best-in-class performers in your sector. Each chart shows the participating depots’ relative performance (see the example chart below). understanding exactly why some operators perform better than others in certain KPIs will help you to decide the best measures to implement in your own operation to improve operational efficiency.

shown in Table 2. The five core KPIs used in previous benchmarking surveys (vehicle fill. on a day-to-day basis most vehicles are managed by the depot manager who is very often not a transport professional by trade. their customer interface is typically through local depots serving a relatively small geographical area. It is there to serve a purpose. A site or depot might typically have a small fleet of three or four vehicles that serve a local network of customers.5 tonne GVW vehicles. Although many of the larger builders’ merchants have either national or regional distribution centres (RDCs). These include the so-called ‘heavy’ materials such as bricks. Their focus can be on customer service and not necessarily transport efficiency. tools. Vehicles of 7. local builders and large construction companies. Members of the group included representatives from the Construction Products Association. regional and local merchants. A working group was established to develop the KPIs for the sector.2 The KPIs In any benchmarking survey it is essential to establish and use the most appropriate set of KPIs possible and ones that everybody in the survey can accurately measure. potentially leaving other parts of the day with less work to do. Further KPIs were carefully considered and a set of 11 finally agreed. plumbing and heating supplies. but not all of them were deemed to be relevant to builders’ merchants transport operations. blocks. the Builders’ Merchants Federation and eight builders’ merchants. deviation from schedule and fuel consumption) were considered. time utilisation.5 tonnes gross vehicle weight (GVW) to 32 tonne GVW rigid vehicles form the mainstay of the sector’s fleet for carrying ‘heavy’ materials. there has been a trend in recent years towards the acquisition of smaller companies by larger national or even Europe-wide businesses. The transport function of these depots in the sector tends to be seen as very much a derived demand. Whilst ‘light’ materials may be carried on the larger rigid trucks (particularly when part of a mixed ‘light’ and ‘heavy’ load). limiting the type and size of vehicles used. Builders will usually expect deliveries to arrive early in the morning. 2. that of delivering goods to the customer. with a significant proportion delivered as well as over the counter trade where the buyer collects the goods. Journey planning is based very much on the personal knowledge of staff as to local routes and locations of customers. Journey lengths are normally short and road access to delivery sites can be tight. fittings. This early morning delivery pattern compresses lorry activity into a narrow delivery window. to supply them with materials for that day’s work. sand and aggregate.2 2.1 The Builders’ Merchants Benchmarking Survey The Nature of the Builders’ Merchants Sector Table 1 Categories of Deliveries and Examples of their Load Type Delivery Light Deliveries Load Type Heating and Plumbing equipment Tools Fasteners Transport Van Light/ Medium Truck Builders’ merchants supply a diverse range of materials essential to the construction industry. they are more normally carried by vans and 7. and not as an entity in itself. To facilitate site unloading these vehicles are often equipped with lorry-mounted cranes. empty running. and ‘light’ materials such as fixtures. These include the general public. Like many industries. Orders are typically taken for delivery of the goods on the next working day. The sector comprises national. Heavy Deliveries Aggregates Bricks Blocks Medium Rigid Trucks Large Rigid Trucks Whilst regional and national merchants maintain overall control of the fleet centrally and will have a nominated transport manager or director. The survey detailed in this report deals with the transport efficiency of these local depots. 5 .

Heavy depots are those principally supplying aggregates. Depots Vans Up to 7.5t GVW Up to 18t GVW Up to 26t GVW Up to 32t GVW Total 25 7 8 17 12 Heavy 21 Mixed 7 6 10 Total 35 14 39 Percentage of Constrained Loads Deviations from Schedule 31 9 40 Time Utilisation 19 15 34 1 63 2 42 3 130 Light depots are those primarily supplying heating and plumbing equipment. bricks.Table 2 The KPIs Measured during the Survey were: KPIs Number of Runs per Day Number of Drops per Run Kilometres per Drop Number of Drops per Day Value per Drop Fuel Consumption Fuel Used per Drop Cost per Drop The number of times the vehicle sets out from the depot with a load The number of deliveries made per run The average distance between deliveries The total number of deliveries made by a vehicle in the day The invoice value of the goods being delivered per drop The number of kilometres run per litre of fuel used The amount of fuel in litres consumed per delivery The total cost per delivery (including fixed and variable costs) The proportion of vehicles that during the loading process ran out of payload capacity. However. Table 3 provides further information on the participating depots and fleets. including the fitment of auxiliary equipment such as lorry-mounted cranes or tail lifts and the use of in-cab telematics equipment. blocks and so on and are typically transported on medium/large rigid trucks. tools. ‘light’ or ‘mixed’ depots. Additional data was also collected from participants to help further investigate the reasons for either above average or below average performance. these activities were separately benchmarked. This information. regional and local merchants operating ‘heavy’. Seven depots in the survey operated fleets for deliveries of both light and heavy goods. These are identified as mixed depots. often with lorry-mounted cranes. deck length or cubic capacity The percentage of trips that incurred a journey or unloading delay of over half an hour The use of the vehicle throughout the day: Running on the road Break from driving Loading in the depot Pre-loaded. 2. fasteners and so on. can be found in Table 4. 6 . They represented national.3 Survey Statistics Eight builders’ merchants businesses participated in the benchmarking process. These goods are generally transported by van or light/medium truck. the same KPIs were used for both light and heavy activities. Table 3 Builders’ Benchmarking Survey Participants Depots Light No. awaiting departure Significantly delayed Idle (empty and stationary) Maintenance or repair These KPIs were selected because they: Are effective reference points for monitoring efficiency and identifying improvement Are relevant to the interests of operators Quantify the levels of fuel and vehicle use Owing to the significant operational differences between the delivery of heavy goods and light goods.

The builders’ merchants trade has a winter off-peak period when often the poor weather impacts on the construction industry. The survey was conducted in March to try to reflect an average level of demand. Table 4 summarises the additional information collected about any specialist equipment fitted to participating vehicles (seven out of eight companies provided data about vehicle equipment). Some 23. For mixed depots. large rigid trucks were fitted with lorry-mounted cranes. The survey was synchronised over a 48-hour period from 07:00 on Tuesday 7th March 2006 to 07:00 on Thursday 9th March. March generally represents the beginning of the trade building up to strong demand between Easter and the autumn. 665 deliveries and 99 trips.5 tonne GVW’ category were equipped with tail lifts.heavy against heavy.291 deliveries for heavy depots. the light and heavy fleets were reported and analysed separately and are benchmarked only against the relevant activity. Thirty-five depots representing a total of 130 vehicles took part in the survey which averages between three and four vehicles per site. light or heavy.462.839 km. likely benefits. 7 .For the purpose of the KPI survey analysis only like-for-like fleets are benchmarked with each other . Collectively.594 and light products worth £402. light against light. Light depots accounted for 10. during the audit period participants delivered heavy products to the value of £312. issues to consider and associated costs. Information Technology for Efficient Road Freight Operations This guide provides an overview of the available and relevant systems.Vehicle Equipment Vans up to 3.5t GVW Total Number of Vehicles Air-flow Management Kit Sat nav Equipment In-cab Engine Management Display GPS Tracking Equipment Vehicles with Crane Equipment Vehicles with Tail Lift Equipment 4 14 Rigid up to 7.5t GVW 39 Rigid up to 18t GVW 40 Rigid up to 26t GVW 34 Rigid up to 32t GVW 3 4 2 5 1 3 3 32 22 1 20 See the Freight Best Practice Guides Truck Specification for Best Operational Efficiency A step-by-step guide to the process of correctly specifying an efficient and ‘fit for purpose’ vehicle. Over half of the rigid HGVs in the ‘up to 7. Table 4 Additional Fleet Information . covering their uses. Typically for the type of operations conducted.120 km were run over 379 trips and 1. None were fitted with satellite navigation equipment.

Some of the depots achieving the highest number of runs per day in the survey are also those that pre-load vehicles.2 is achieved by a depot in the light category that pre-loads its vehicles for the next morning’s work.5 tonne GVW trucks.3 3. However. reflecting a combination. For light deliveries there was no difference in runs per day between vans and 7. vehicles in the 18 tonne category actually averaged the highest number of runs per day at 2. Figure 2a Heavy Deliveries . a high number of runs per day must not be taken to mean an efficient operation if the vehicles are only partly loaded or are making special one-off trips. For example. For the light fleets in the survey (shown in Figure 2b) the average number of daily runs per vehicle is 1. Overall vehicle utilisation can be maximised and fleet size minimised by ensuring that vehicles undertake second and third runs during the working day.4.1 Survey Results Number of Runs per Day This simple KPI measures the number of times the vehicle sets out from the depot with a load. The relatively small delivery area covered by many merchants’ depots means that vehicles can often return to depot for more than one load per day. the highest run rate of 3.Runs per Day Figure 2b Light Deliveries . For heavy deliveries. the typical number of runs per day is two. of a higher number of drops per run and a larger delivery area.Runs per Day 8 . depending on depot. Figure 2a shows that overall for the heavy fleets. High customer service levels can also be offered in terms of same-day or next-day deliveries.3.

This suggests good vehicle specification for the tasks being undertaken which most likely assists in maintaining a high drop rate. the number of drops per run varied greatly across the entire survey sample as well as between companies’ own depots (see Figures 3a and 3b).7 for heavy goods. In both the light and heavy delivery fleets. Figure 3a Heavy Deliveries .2 Number of Drops per Run The number of drops or deliveries made per run can depend on several variables including consignment size. light activities overall averaged a higher drop rate than the heavy deliveries .5 tonne GVW vehicles working on light deliveries achieved over nine drops per run. Not surprisingly. On average.Drops per Run Figure 3b Light Deliveries .7 drops per run for light goods versus 3. compared with around five for vans.6.4. the two heavy goods depots that show a drop rate of double the sector average are operating 7. Commentary on light delivery activities for lorries and vans is provided in Section 3.Drops per Run 9 . vehicle type.5 tonne GVW vehicles with tail lift equipment. Interestingly. distance between drops and scheduling practices.3. 7.

Whilst this is most likely a historical matter of depot location. delivery area and vehicle routing and scheduling.3 Kilometres per Drop Overall. It can therefore be assumed that their depot delivery area is similar to those companies operating a national network of depots.5 km for heavy activities and from 7 km to 35.Km per Drop 10 . Figure 4a Heavy Deliveries . the nature of builders’ merchants activities in the survey means that.9 km to 35. delivery distances are short. Depots within the same company can show large variations in drop distance. Figure 4a shows the average distance between deliveries for heavy activities. The regional and local merchants participating in the survey did not report any drop distances above the sector average.9 km for vehicles engaged in light activities. in comparison with many other transport activities. When comparing the heavy drop distances with those of the light activities (see Figure 4b). significant deviations from the sector norm merit investigation in terms of depot location. it can be seen that the spread is remarkably similar – 5.3.Km per Drop Figure 4b Light Deliveries .

The average distance between drops was reported as 16.7 litres per drop compared with 3. whilst the 7. the vans in the survey averaged six drops per day.50 cost per drop recorded for van operations.5 tonne vehicles .30.7 km for 7. most vehicle types show the same performance levels (see Table 5).5 litres for vans. the cost per drop for 7.Drops per Day Here. some 38% lower than the £26.4 Number of Drops per Day Figures 5a and 5b show the total number of deliveries made per day by vehicles operating from heavy and light depots. when investigating the relationship between vehicle type and drops per day.5 tonne vehicles 2. The average value per drop was also higher for the 7. The greater ‘drop rate’ and shorter drop distance result in a 22% lower fuel use per drop for 7. Once again. The one marked difference is the performance comparison on light activities between vans and 7.5 km for vans.5 tonne GVW trucks. Figure 5a Heavy Deliveries .3.5 tonne vehicles delivering light goods is £16. Overall. This is often facilitated by short drop distances. Figure 5b Light Deliveries . The ‘best in class’ performers are those making the highest number of runs per day and the highest number of deliveries per run. Overall.9 respectively. Delivery scheduling and vehicle routing play a key role in maintaining good performance in terms of drops per day. Issues regarding value per drop and vehicle specification are further highlighted in Sections 3.£670 in comparison with the average value for drops by vans of £460.Drops per Day 11 . there is a wide spread of performance both across the survey sample and between individual company fleets.2 drops.5 tonne GVW vehicles averaged 11. This suggests that operators are generally specifying vehicles correctly for the nature of the activity to be performed.5 and 3.5 tonne GVW vehicles and 19. This again reflects the operational efficiencies and cost savings achievable where the vehicle is well suited to the type of work being undertaken.

Value per Drop From the data the average invoice value of a heavy delivery has been identified as £355. Seven of the eight participants have provided information on value per drop. However.000. values range from £150 to around £540.5t GVW Rigid Up to 18t GVW Rigid Up to 26t GVW Rigid Up to 32t GVW Rigid 6. With the exception of two depots reporting very high values of over £1. Whilst it is not directly an indicator of either efficiency or profitability.5 Value per Drop The invoice value of the goods being delivered per drop has not typically been used as a benchmarking KPI for transport activities. the variation in drop value across the depots is very large – from less than £60 to nearly £2. Figure 6a Heavy Deliveries .8. have more usually been adopted. For light activities. Measures related directly to trucks. such as vehicle fill and running time.2 Heavy Light 6 11.000. and the average for a light delivery as £720 (see Figures 6a and 6b).2 3. A break down by vehicle category of delivery value and delivery cost is shown in Section 3.Table 5 Drops per Day by Vehicle Category Activity Vehicle Category Up to 3. it is a useful starting point to identify where delivery activity can be of most value to the creation of profit for the business. the survey participants adopted this measure as an important business indicator. The difference in value per drop across the participating heavy depots is relatively modest. Figure 6b Light Deliveries .2 6.Value per Drop 12 .5t GVW Van Up to 7.2 7.5 7.

3 2.7 3. Vehicle Category Van .6 Fuel Consumption Table 6 Fuel Consumption by Vehicle Category Kilometres per Litre of Fuel Used Fuel consumption.Long Wheelbase Up to 7. They provide an overall fuel consumption figure across all vehicle types.Short Wheelbase Van .5 Heavy Depots Figure 7a Heavy Deliveries .3.5t GVW Rigid Up to 18t GVW Rigid Up to 26t GVW Rigid Up to 32t GVW Rigid Fuel Consumption (Km per Litre) Light Depots 5. was recorded by vehicle type for each fleet during the survey period. measured in kilometres per litre. It should be noted that good consumption figures returned by the long wheelbase van and 32 tonne GVW truck categories may not be representative.9 4.4 5.Km per Litre Figure 7b Light Deliveries . Table 6 provides a more detailed breakdown of fuel consumption figures by vehicle category.Km per Litre 13 .6 6. as these vehicle types were operated only by two survey participants and in small numbers. The results are shown in Figure 7a for heavy activities and Figure 7b for light activities.2 2.

and the implementation of a fuel management programme including driver development.5 litres per drop as shown in Figure 8b. This KPI measures the amount of fuel used per delivery made and thus measures not only the energy input but also the work output. There is a large variance between ‘best in class’ and ‘worst in class’ performance. one participant used almost two and a half times as much fuel per drop at one depot compared to another. For example.7 Fuel Used per Drop Measuring fuel consumption alone does not necessarily provide an accurate measure of overall efficiency or performance. fuel figures may look poor because of high use of auxiliary equipment such as lorry-mounted lifting equipment. What counts more is the amount of ‘work done’ for a given amount of fuel. many depots are getting three times as much ‘work’ per litre of fuel in comparison to what appear to be very similar operations.4 litres per drop and this is illustrated in Figure 8a. These actions are explored further in Sections 4 and 5. only half of the participating depots actually carry this out on an on-going basis. Fuel use per drop also varies greatly across the depots of individual companies within the survey. Not surprisingly. 14 . An operator may show apparently good fuel performance figures. Alternatively. Initiatives could include management actions. such as fuel monitoring. Nevertheless. For light activities it is 3. the use of lifting equipment and limited opportunities for improving fuel use through measures such as vehicle aerodynamics mean that vehicles operating in the builders’ merchants sector are likely to show a higher than average fuel use. Even disregarding the very best and the very worst performers. Whilst fuel use has to be monitored closely as part of the benchmarking process. significant fuel savings could be made. the results do show that there is good reason for a number of operators to investigate the causes of poor fuel figures at specified depots. Average fuel use for heavy activities is 6. but the vehicle may only be partly laden or there may be a large proportion of empty running. those depots that are monitoring fuel use perform better than those that do not. Short journeys. This is termed as ‘energy intensity’.3. If these causes were understood and appropriate action taken. This compares with over 70% for transport operators in general.

Figure 8a Heavy Deliveries .Litres per Drop Figure 8b Light Deliveries .Litres per Drop 15 .

and also compares delivery value.showing a very high delivery cost and a very low load value.90 25. there is no direct positive correlation between delivery costs and the value of the consignment.90 1207.60 297.Cost per Drop 16 .90 Not available 31.3.70 34.Long Wheelbase Up to 7. for one depot the two measures were inversely related . The average cost per drop across all vehicle types for heavy activities is £26 and for light activities it is £24. Table 8 shows the cost per drop by vehicle type.7 16.80 Figure 9a Heavy Deliveries .8 Cost per Drop Detailed company-based investigations will prove beneficial in helping to determine the profitability of product lines. delivery activities and locations.70 26. Importantly.375 18.70 235.Short Wheelbase Van . The cost per drop or delivery was calculated using the fixed and variable cost information collected from survey participants as shown in Table 7.10 462. Figures 9a and 9b show that the cost per drop varies greatly across both light and heavy depots.30 458.5t GVW Rigid Up to 18t GVW Rigid Up to 26t GVW Rigid Up to 32t GVW Rigid Value Cost Value Cost per per per per Drop (£) Drop (£) Drop (£) Drop (£) 1. Table 8 Cost and Value per Drop by Vehicle Category Light Depots Heavy Depots Table 7 Cost Information Collected Fixed Costs Vehicle depreciation Vehicle insurance MOT Drivers’ wages (drivers’ wages include employer costs but NOT additional costs for temporary drivers covering holiday periods) Variable Costs Fuel Vehicle repairs and maintenance Tyres Vehicle Category Van . Indeed.50 35.

Where this occurs. Load constraints were reported to be less frequent in the light fleets.one operating vehicles plated at 12 tonnes GVW. The main contributor to delays was ‘problems at the delivery point’. Significantly. means that the precise measurement of load configurations in terms of weight or cubic capacity is difficult and ultimately not that important in terms of day-to-day transport activity. However. 3. In total. deck length or cubic capacity. vehicle fill was not selected as a KPI by the participating fleets. 7. weight etc. Furthermore.Cost per Drop 3. eight heavy depots and two light depots reported deviations from their delivery schedule. five heavy depots belonging to two different participants reported every trip to be constrained by weight . the load must be split and either an additional vehicle loaded or a second run made. Figure 10 Causes of Delays Whilst local delivery restrictions limiting vehicle size will ultimately determine the size and capacity of the vehicle selected for a job.3% of all trips surveyed were affected.Figure 9b Light Deliveries . Figure 10 shows a breakdown of the contributory causes of the delays. one company reported regular delays at all of its depots. participants recorded instances where loads could exceed payload capacity. it seems clear that there are instances where the use of vehicles with a higher payload capacity would lead to fewer trips and greater efficiency. Nearly half of the survey depots reported a load constraint by weight and a third by length and cubic capacity. size. and the other operating 26 tonne GVW and 32 tonne GVW vehicles. The diversity in product range.9 Percentage of Constrained Loads In this benchmarking survey. Two merchants reported depots where 50% of all trips were subject to delay. 17 . although one company noted a problem with payload capacity.10 Deviations from Schedule Survey participants recorded significant delays (of over 30 minutes) affecting deliveries against four possible reasons: Own company actions Problems at delivery point Traffic congestion Vehicle breakdown Of the companies included in the survey.

Figures 11a and 11b show the activity profile of the heavy and light fleets. there are opportunities to pre-load vehicles. This compares favourably with some other daytime-based vehicle activities such as parcels and pallet load deliveries.3. Vehicle activity. Since orders for the next day’s first deliveries are generally processed by mid-afternoon.11 Time Utilisation During the survey period an hourly audit of vehicle activity was recorded. This identified what vehicles were doing at any given time.out of hours deliveries are rare. but less well with some retail fleets where idle time can be as low as 20%. this practice is not adopted universally across all depots or by some of the survey participants and therefore could be a good way to increase productivity. facilitate second and third run opportunities and generally increase vehicle productivity. awaiting departure Significantly delayed Idle (empty and stationary) Maintenance or repair Delivery activity in the sector is currently a daytime activity . The activity categories are: Running on the road Break from driving Loading in the depot Pre-loaded. However. Figure 11a Time Utilisation for Heavy Activities Figure 11b Time Utilisation for Light Activities 18 . in terms of running on the road. This can help to maximise the working and driving time available. Over 18% of the heavy fleet in the survey was reported to be pre-loaded in this way. is therefore typically between 05:00 and 17:00. It can be seen that vehicles are idle and unproductive for more than 40% of the time. and which can benefit from out of hours delivery schedules.

payload and auxiliary loading equipment have been identified in the survey as critical in ensuring maximum productivity. these conditions can inhibit efficiency and make significant improvements a real challenge for those in the industry. Through the individual survey reports produced for them. Identifying the variance between depots has allowed participants to investigate best and less than best operational practices. the fold out back cover of this guide sets out a transport efficiency road map for builders’ merchants – an action plan of measures that can be considered by anybody in the sector. It identifies the measures that can be ‘owned’ and initiated by those managers responsible for transport within the business. for example. such as nominated delivery days for less than full-load consignments. For some. the potential use of 32 tonne GVW rigids is noted for investigation. The industry culture that currently demands an early morning delivery deadline compresses activity into a period of peak-hour traffic congestion and can leave vehicles idle for significant parts of the working day. fuel consumption has perhaps. marketing and procurement departments. It also shows wider strategic measures. Such measures would. for example. A number of the survey participants can most probably benefit from specifying 26 tonne GVW vehicles instead of 18 tonne GVW vehicles. of course. performance across depots varies greatly. Significant anomalies identified at some depots in the survey have warranted swift investigation. Correct vehicle specification .4 Summary 5 Operational conditions for truck fleets in the builders’ merchants sector are clearly different than those for other sectors of the freight industry. traditionally not been a major focus for depot managers. together with a signpost identifying relevant guidance and support material available from the Freight Best Practice programme. Variations in fuel consumption between depots show that there are potential benefits in implementing fuel management programmes. therefore journey distances tend to be short. Maximising time running on the road by pre-loading vehicles is practised by some of the sector. There is a strong emphasis on early morning deliveries and even a tendency to despatch vehicles partly laden to fulfil a customer order. require the close involvement of other parts of the business. . this pays dividends in terms of the number of deliveries that can be made in the day and represents good practice that could be employed on a wider basis. of course. have its own conditions and constraints. Taken collectively. many company and depot specific recommendations have been made and acted upon. With relatively low annual vehicle mileage. fuel management and load preparation. For many. The action plan is set out under the following six headings: Saving Fuel Equipment and Systems Developing Skills Performance Management Fleet Performance Supply Chain Reconfiguration Specific actions are identified under each category. reduce transport costs and avoid deviations from schedule and delays. 19 The Builders’ Merchants Transport Efficiency ‘Road Map’ Based on the findings of the survey. Each depot will. sales. Encouraging customers to accept deliveries at other times of the day will help to maximise vehicle utilisation. Fleets can be large but operate in small clusters that are dispersed over a number of depots. and the survey has shown that even within the same operation.

Consider rate discounts for off-peak deliveries. For example: UNITISATION OF CUSTOMER ORDERS • • • Brick pack – bricks. SUPPLIER DIRECT DELIVERIES Investigate benefits of supplier direct delivery.Performance Management • • Set targets Benchmark across depots MONITORING PERFORMANCE Fleet Performance Management Tool Establish relevant key performance indicators and measure performance: LOAD PREPARATION Increase pre-loading of vehicles of next day’s loads to ensure maximum productive delivery time. Preparation by yard staff of second trip loads whilst vehicle is on first run. plasticiser Door pack – door. allowing second run loading during morning peak traffic congestion and post-peak second run. INTER-DEPOT CO-OPERATION Establish standardised customer service levels and serve customer from most appropriate depot for the delivery site. valves Sector Initiative . screws Plumb pack – pipe. Supply Chain / Logistics Director ZONING Consider delivery of less than full loads on nominated days by geographical area. hinges. Fleet Performance PRICING MECHANISM Consider rate discounts for off-peak deliveries. DELIVERY WINDOWS Encourage customers to accept pre-8am deliveries. Sales staff to ‘lead’ customers to available delivery times. Increase pre-loading of vehicles of next day’s loads to ensure maximum productive delivery time. Establish economic thresholds. CONSOLIDATION CENTRES Review industry-wide opportunities for trip reduction through multiple construction site delivery consolidation centres. joints. Supply Chain Reconfiguration SUPPLIER GATE COLLECTIONS/ BACK-LOADING Make Back-loading Work for You Investigate benefits of collecting supplies direct from suppliers – ‘supplier gate pricing’. Review opportunities for reducing empty running by back-loading. cement. Investigate market opportunities for further unitisation of deliveries and consolidation of orders.

Consider fitment of auxiliary equipment to reduce unloading time. Audit current fuel management processes. Implement effective fuel management programme: Ownership or Initiator Saving Fuel Stock control Dispensing In-use control • • • • • Purchasing Data collection ROUTING AND SCHEDULING Computerised Vehicle Routing and Scheduling (CVRS) for Efficient Logistics Audit order processing. routing and scheduling process. Implement driver development programme. Equipment and Systems TELEMATICS Telematics Guide Consider benefits of in-cab telematics and communications systems to enhance expected arrival times. MULTI-TASKING Train yard staff as drivers to provide flexibility for holiday cover and sickness cover. Depot Manager VEHICLE SPECIFICATION Truck Specification for Best Operational Efficiency Review vehicle specification and potential benefits of the introduction of vehicles with increased: • • • Payload Load bed Cubic capacity . Developing Skills DRIVER DEVELOPMENT A Guide to Safe and Fuel Efficient Driving for HGVs Conduct training review audit. Review potential benefits of computerised routing and scheduling. Consider implementation of driver league tables and rewards scheme. and reduce dependency on agency staff. traffic avoidance and performance monitoring.Builders’ Merchants Transport Efficiency Road Map Efficiency Measures for General Consideration General FUEL MANAGEMENT Fuel Management Guide Specific Description Appoint Fuel Champion. Optimise journey planning.

covering their uses.org. Equipment and Systems Information Technology for Efficient Road Freight Operations This guide provides an overview of the available and relevant systems. service delivery levels and accident rates. including those listed below.Freight Best Practice publications. Printed in the UK on paper containing at least 75% recycled fibre. Public Sector Efficient Public Sector Fleet Operations This guide is aimed at fleet managers in the public sector to help them improve operational fleet efficiency. It includes advice on how information is best collected and interpreted to allow informed decision making in order to achieve operational efficiency improvements. Operational Efficiency Expert Advice Helps Cut Fleet Costs This case study shows the savings achieved by Denholm Industrial Services Ltd as a result of the measures implemented as part of a site specific efficiency improvement plan.freightbestpractice.uk Saving Fuel Fuel Saving Tips This handy pocket book is ideal for drivers and managers looking for simple ways to reduce fuel consumption. likely benefits. Alternatively. FBP1049 © Queens Printer and Controller of HMSO 2006. issues to consider and associated costs. Developing Skills Proactive Driver Performance Management Keeps Fuel Efficiency on Track This case study shows how Thorntons implemented a highly effective driver incentive scheme combining in-cab driver monitoring. they can be downloaded from the website www. Performance Management . can be obtained FREE of charge by calling the Hotline on 0845 877 0 877. Performance Management Performance Management in Freight Transport Operations This guide explains the process of measuring performance effectively. November 2006.