October 22, 2018

Getting The Most From What You Have

We roll-off guys work in a capital-intensive business. Trucks and containers represent a significant amount of hard to come by capital.
Shipping containers stacked on top of each other

We roll-off guys work in a capital-intensive business. Trucks and containers represent a significant amount of hard to come by capital. Investors and bankers want to see how their capital will be reliably put to a productive and profitable use before they hand it over. And, having low overhead and controlling disposal costs is not nearly enough to make this price competitive business work.

Our hardest job is getting the most out of our trucks and containers every day despite having very little regularly scheduled work. For the roll-off operator who fails to maximize paid hauls per truck per day, there is nowhere to hide and nowhere to get more capital.

In the trash hauling business, virtually all the assets of the business are mobilized every day and go to the service points where they create value remotely. These assets can only be made more efficient by shortening the time and distance between the points where they create value and revenue.

For most of the trash hauling industry the exercise to create efficiency is straight forward, albeit sophisticated when practiced well. Two thirds of the trash hauled (by number of vehicles) serves commercial and residential customers. This work is done almost exclusively under fixed contracts and is performed on a routine, repetitive basis on regular routes over long periods of time. Because of these characteristics, routing efficiency, revenue and value creation can be measured, modeled, planned and adjusted to fine tune the very best usage of equipment in an optimal way. Once patterns are designed and optimized, it’s all about repetitive execution, much like the assets deployed in manufacturing. Trash hauling operators always search for “density” in their markets, seeking to add work as physically close to exiting or planned work as possible.

The exception to this is the one third of vehicles hauling construction and demolition debris, serving one time or short term needs by professionals and homeowners and is generally associated with roll-off dumpsters.

Roll-off operators face the challenge of trying to deploy very expensive assets across very broad geographies. They serve customers who specifically don’t usually want service provided on a regular basis, they want it on demand at their convenience, often on a same day basis.

Commercial roll-off customers migrate within and outside of the market area, opening new service locations and closing others constantly. Consumers who use roll-offs do so infrequently and unpredictably from a location standpoint. The points of service are different every single time with initial delivery and repetitive service locations being unique at every single work sit.

The problem in this case, of course, is that once a roll-off operator gets beyond the size of a few trucks and a few hundred dumpsters, in this uncontrolled, random and constantly changing environment, it’s literally impossible to develop patterns and, virtually impossible to keep track of and optimize these expensive resources.

Expensive assets in fixed locations have key advantages for optimization, they are constantly visible and controllable for adjustment and change, and there is no delay in the overall system performance information available to make efficiency adjustments. So, the only true solution to gain the maximum opportunity to manage the expensive mobilized roll-off resources moving randomly and dynamically is to deploy an information system that has two key characteristics.

1. Optimized around orders not routes: The information system must be designed with tools and systems to allow the operator to model efficiency with individual orders, not groups of orders or routes.
2. Live, real-time information. The roll-off operator must have live, instant access to all the inputs that bear on the entire fleet’s workload and status, with the same ability operators have over fixed assets, that is the ability to optimize, re-optimize and constantly optimize again dynamically during each work period.

Only a live, mobilized roll-off information system that creates a real time connection from the customer to the dispatcher to the driver and down to the load and container ID level can give the operator a fair chance to optimize use of the resources they have and significantly improve the return on those assets.

I couldn’t find a roll-off software system to do this for me, so I built one myself. I’d be happy to show Starlight to you.



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