Tag Archive for 'construction equipment'

GPS Tracking of Light/Medium Duty Fleets Increases Profitability Through Driver Accountability

By Carlo Chatman, Power PR

For any company with a fleet of light or medium duty vehicles, from service contractors to vendors and those in the transportation industry, increasing profitability often comes down to fostering an environment of greater employee accountability.

The concept of accountability is defined as “the obligation of an individual to account for his/her activities, accept responsibility for them and to disclose the results in a transparent manner.” Implied in this definition is the ability to verify tasks are completed as expected, on time, efficiently and per company policy. For fleet managers, this can only be accomplished through real-time GPS tracking devices on all vehicles.

After all, it is an established fact that drivers that know they are being monitored by such systems are less likely to make unnecessary detours or stops for personal reasons, may avoid spending unnecessary time at job sites or avoid idling the engine while filling out paperwork in the vehicle.

But accountability is not about discovering what a driver is doing “wrong,” it is actually more about what the driver is doing right. Through GPS tracking, drivers can take more ownership for their jobs, have more clarity of tasks and results, can self-correct, improve and do not have to be micromanaged. 

Advanced Tracking Technologies’ GPS tracking systems are used in the construction industry to provide employees and owners accountability and peace of mind. 

Even well intentioned drivers may discover that there are areas of improvement and efficiencies that could make them more productive. 

There are also indirect benefits as well. When all drivers are monitored, those not pulling their weight are more easily identified so faster, more productive employees do not have to pick up the slack with extra deliveries or service visits.

Finally, with greater accountability, higher performing employees are more likely to be recognized and rewarded based on verifiable performance.

So, with a host of benefits for the employee, fleet managers that have avoided the “leap” to GPS tracking are missing out on a win-win scenario. After all, more accountable drivers lead to greater efficiency overall, which means increased profits. It’s an argument that is hard to deny, particularly as GPS tracking continues to improve while the cost of entry plummets.

Holding Drivers to a Higher Standard

Although GPS trackers have been around for some time, advances in the technology allows for more real-time tracking and simplified reporting. Fleet managers, after all, don’t want to spend all day on their computers sifting through complex analytical data. Instead, they want simplified, easy to read reports that summarize what they need to know. Fortunately, such systems exist today and at rates less than $20 per vehicle.

The advanced units today allow real-time and historical tracking of each vehicle in a fleet. This allows dispatchers to assign the closest vehicle to a job, which expedites the service work or delivery and saves gas, labor, and vehicle wear-and-tear. It also allows historical routing analysis, which enables even greater routing efficiencies to be determined on an individual or fleet-wide basis.

Through GPS tracking, drivers can take more ownership for their jobs, have more clarity of tasks and results, can self-correct, improve and do not have to be micromanaged.  
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However, the greatest improvements in fleet management occur when GPS tracking devices are used to hold drivers to a clear, unbiased standard to encourage better performance for the company and themselves.

Real Life Results

As an example, when Reilly Construction & Development implemented their first GPS tracking system last year, the Vero Beach, Florida-based residential and commercial construction company benefited from significant productivity gains and operational efficiencies.

The construction company has installed Shadow Tracker Vision III GPS tracking devices from Advanced Tracking Technologies (ATTI), a Houston, Texas-based designer and manufacturer of GPS tracking products, on two of their construction trucks. 

Compared with typical GPS tracking devices that may only update every few minutes,

the device provides real-time location updates every 10-seconds, as well as location, speed and idle time alerts if something is amiss. This data is transmitted via satellite and cellular networks to a smartphone or PC on a 24/7 basis.

With such accountability for how every minute of each day is spent, employees know they are always “on the clock”. This helps to eliminate frivolous or unnecessary stops during the workday, and decreases wasted time during a stop. 

“Now we know exactly where our vehicles and drivers are in real time,” says Sharon Arnold, Office and Assistant Project Manager at Reilly Construction & Development. “We can spot check our drivers to make sure they are where they are supposed to be and not at unauthorized places because some people will take advantage. That has saved us a few thousand dollars in salary alone. The system more than pays for itself in enhanced productivity.”

On the plus side for employees, the use of such GPS tracking systems helps verify on-time arrival at customer sites. And automated reporting such as that provided by the ATTI system can virtually eliminate the reporting burden for employee and employer in regard to driving logs. Automated exception reporting can also flag potential issues that need to be corrected, such as excess vehicle mileage or idling.

“We are trying to work smarter, not harder,” says Arnold. “We are trying to make things simple and straight forward. With everything out in the open, people know what to expect.”

Increased Productivity, Reduced Fuel

Once drivers and the work crew know they are accountable for their actions, it is amazing how much more they will accomplish. Using such an approach with advanced GPS tracking commonly improves productivity 10 to 20 percent while reducing fuel costs 10 to 15 percent, as drivers start to pay attention to their driving and work habits throughout the day.

Indiana-based Gordon Plumbing Inc., which offers services ranging from small fixes to remodeling and construction, currently uses ATTI’s GPS tracking system on 54 vehicles, and has used three different tracking systems over the last decade.

“The ATTI system not only expedites job dispatching but also enhances accountability and profitability while reducing costs,” says Shannon Allen, Gordon Plumbing Service Coordinator. 

Allen points out that being able to access a vehicle’s position in real time means “our vehicles can reach customers very quickly when there are emergencies.” She adds, “If our drivers on the job need help from a tech specialist, we can immediately find one in their area and dispatch them to that address.”

According to Allen, the system provides one link for all the covered vehicles. “The GPS tracking system puts our vehicles on a map, so I can see all of them at once,” she says, noting that the view can be narrowed to any department or geographic area, as desired. “It is so accurate that it lets me see exactly where a vehicle is parked.”

Because the GPS system is automated, reports are delivered without anyone having to open software. In addition to the real time views of the activity taking place, next day reports are delivered by email, documenting everything that happened the day before. The reports can be customized, for example, to show how many drivers idled for more than 30 minutes or how many miles were put on a vehicle.

Allen emphasizes that the system can quickly spot driver habits that need correction, such as a driver stopping for five or 10 minutes between jobs several times a day. 

“With the GPS system, we are able to notice and point out that even five to 10 minutes stops between jobs each day adds up to a lot of lost productivity,” says Allen. She concludes, however, that her drivers are quite used to the system and even appreciate it when it proves that they are getting to and doing their jobs as required.

For a free demo, visit https://www.advantrack.com/free-demo/. For more information contact Advanced Tracking Technologies, 6001 Savoy Drive, Suite 301, Houston, TX 77036; visit www.advantrack.com; call 800-279-0035; email sales@advantrack.com. 

This feature appeared in the January 2020 issues of the ACP Magazines:

California Builder & Engineer, Construction, Construction Digest, Construction News, Constructioneer, Dixie Contractor, Michigan Contractor & Builder, Midwest Contractor, New England Construction, Pacific Builder & Engineer, Rocky Mountain Construction, Texas Contractor, Western Builder

Gypsum Solutions

Selecting a Pump to Maximize Productivity and Profitability in Gypsum Applications

By Tripp Farrell, President, Blastcrete Equipment, LLC

New construction is on the rise across the country – especially for multi-family residential units, where completions are at record numbers and show little evidence of slowing down into 2020. These projects create an ideal environment for contractors looking to break into or grow their business in high-flow material markets with gypsum floor underlayment, grouting, cellular concrete, plaster and stucco applications. 

Recent advancements in rotor-stator technology led to the introduction of an adjustable rotor-stator pump with inline pressure gauge to the gypsum mixer/pump market. This innovation allows contractors to adjust flow to meet a project’s unique requirements, resulting in less wear and tear on pump components

However, success in this field requires an investment in specialized equipment – a limiting factor for many bottom-line-conscious contractors. While there is no way to offset equipment costs altogether, recent innovations in gypsum mixer/pumps have made these units more affordable, user-friendly and versatile than previous options. With the right equipment, contractors can see quick ROI and increased efficiency.

Here are several key factors to consider when selecting a gypsum mixer/pump to maximize productivity and profitability.

Pump Type

The type of pump is perhaps the most important feature to consider when investing in a gypsum mixer/pump. For contractors considering lower output gypsum applications such as radiant heat, smaller and more economical peristaltic/squeeze pumps can be used successfully. However, squeeze pumps will surge, which results in a light interruption in material flow. Minimal surging can lead to splatter on drywall, resulting in unnecessary cleanup. The squeeze pump has a maximum 450 psi line pressure which limits pumping distance to around 300 feet.  

Rotor-stator pumps, on the other hand, provide continuous flow, eliminating surges and increasing productivity. These pumps can generate up to 600 psi of pumping pressure – about 30 percent more than squeeze pumps – for pumping distances in excess of 150 feet vertically and 500 feet horizontally. 

Gypsum mixer/pumps that can be charged directly with a specially designed skid steer bucket not only saves time and energy; they allow contractors to set up sand and gypsum stockpiles in a separate location when space is at a premium. 
 

Recent advancements in rotor-stator technology led to the introduction of an adjustable rotor-stator pump with inline pressure gauge to the gypsum mixer/pump market. This innovation allows contractors to adjust flow to meet a project’s unique requirements. Tightening the rotor-stator results in maximum pumping distances, which is ideal for high-rise and long-distance jobs. When the job requires shorter pumping distances – between 200 and 300 feet – contractors simply loosen Gypsum mixer/pumps that can be charged directly with a specially designed skid steer bucket not only saves time and energy; they allow contractors to set up sand and gypsum stockpiles in a separate location when space is at a premium.  rotor-stator. This flexibility results in optimum pumping pressure for the application. 

Adjusting the pump to fit the application specifications results in less wear and tear on the rotor-stator since these are the primary wear parts on this style of pump. Monitoring and adjusting the line pressure helps contractor double or even triple the life of these components. To further minimize lifetime maintenance costs and unnecessary downtime, some OEMs design their adjustable rotor-stator pumps with easy access to mechanical seals. This user-friendly design allows operators to perform mechanical seal maintenance without dismantling the rotor and stator, drastically reducing labor expenses and saving hours of unnecessary downtime. 

Price Point

No product selection discussion would be complete without touching on price. Cost is an important factor in determining the value a piece of equipment brings to a business and whether it’s worth pursuing. In the past, a limited selection of gypsum mixer/pump models meant contractors looking to invest in gypsum equipment might be stuck with a higher price tag and unnecessary features for their operation. 

The type of pump is perhaps the most important feature to consider when investing in a gypsum mixer/pump. Rotor-stator pumps provide continuous flow, eliminating surges and increasing productivity.
 

A lack of specialized gypsum equipment options also led some contractors to purchase units designed for more general cementitious applications – a situation that came with its own host of problems. However, as the gypsum industry continues to develop, more economical mixer/pump options with simpler and more user-friendly designs are filling the gap, offering contractors the ability to select equipment based on their needs without overinvesting.

Prices for a new gypsum mixer/pump can range from $45,000 to well over $125,000. Comparing apples to apples in terms of capacity and output, contractors will find minimal difference between most gypsum machines. The industry average is 12-cubic-foot mixers and pumping speeds well over 100 bags of gypsum per hour. 

Differences arise with a closer inspection of the spec sheets. Contractors looking to not pay for more than they need should contact manufacturers to walk through what features are necessary for their specific operation. For example, engine size can play a huge part in price differentiation. Gypsum mixer/pumps range in size from 3,350 pounds with a 32-horsepower engine to nearly 10,000 pounds with a 100-horsepower engine. 

Exactly how much horsepower is necessary will depend on the target applications, so discussing options with OEM experts is important for making the most practical and economical decision. While gypsum mixer/pumps are not totally customizable, partnering with certain OEMs allows for a more personalized result, often with a significant cost savings over standard models. 

Simplified Design

The saying “less is more” often applies to gypsum mixer/pumps. In addition to reducing the initial cost, selecting a reliable gypsum mixer/pump that does the basics and does them well often results in a user-friendly unit that’s easy to operate, maintain, and keep clean.

Hydraulic spiral mixers offer a benefit over paddle mixers since they can operate at higher speeds without splashing or throwing material out of the mixer. This mixer also limits possible maintenance issues and unnecessary downtime by minimizing moving parts.

To make the most of an equipment investment, the machine needs to have high utilization. For contractors looking to operate at multiple jobsites with multiple crews, selecting a gypsum mixer/pump with the essential components and no frills equates to less training, less downtime and less stress. Machines with a simple, intuitive design are easy to operate with minimal training. This opens up the door for maximum productivity since contractors can train several crew members and still deliver quality results.

Fewer moving parts also means less mess and less maintenance. A unit’s mixer is a good example of this. Most units feature either a paddle type mixer or a hydraulic spiral mixer. Both work quickly, mixing a full load in about two minutes. However, hydraulic spiral mixers offer a benefit over paddle mixers since they can operate at higher speeds without splashing or throwing material out of the mixer. This leads to increased productivity since crews are not spending unnecessary time cleaning. 

Additionally, the paddle style mixers used in gypsum equipment usually have two mixer shafts, which doubles the moving parts. Compare this to a single planetary gearbox driving the spiral mixer. With features like spiral mixers, new gypsum mixer/pumps limit possible maintenance issues and unnecessary downtime by minimizing moving parts.

These time-savings aren’t limited to major maintenance. Proper cleaning is vital for any concrete pump, including gypsum equipment. The less there is to clean, the faster this process will be. Look for a model with easily accessible wear parts to make daily cleaning as efficient as possible. Some manufactures have gone a step further to simplify maintenance by engineering a removable mixer and pump kit that simply detaches from the machine for the ease of cleaning and scheduled maintenance.

Maneuverability

Transportability is another key consideration when selecting the right mixer/pump combination. The larger and more remote the contractor’s service area, the more vital this becomes. Units featuring robust trailers for long-distance travel and a lighter footprint provide a more practical solution for extended service areas. For maximum maneuverability, look for a unit with a dual axle high-speed towing trailer and tubular steel frame to enable safe travel on highways. 

Onsite maneuverability is another area to keep in mind. Once the equipment has arrived, its placement and use can be quite the logistical challenge – especially on crowded jobsites. A gypsum pump with a smaller footprint can increase overall productivity. The charging process for different machines is a good example of this. Some models include a skip hoist to charge the mixer. The hoist is filled with sand and gypsum either by hand or with a skid steer bucket. When full, it rises and dumps into the mixer. 

This system requires sand and gypsum material to be stored near the pump and ample space for the hoist to maneuver, limiting where contractors can set it up. Gypsum pumps without the skip hoist eliminate the additional step and can be charged directly with a specially designed skid steer bucket. This not only saves time and energy; it allows contractors to set up sand and gypsum stockpiles in a separate location when space is at a premium. 

Customer Service

As with many equipment decisions, brand is an important factor to consider when selecting a gypsum mixer/pump. The right machine will ultimately be the one with the ideal combination of features and price, but the service and support behind that unit can’t be discounted. Partnering with a manufacturer that has a reputation for robust, high quality machines means operators can expect fewer breakdowns over its lifetime. Plus, when parts and service are required, knowing the team behind the brand is available 24/7 can be a huge relief. From fast delivery of parts to expert troubleshooting, dedicated OEMs help their customers increase efficiency.    

Making the Right Selection

The surest route to success in any business starts with investing in the best equipment to get the job done quickly and efficiently. Recent advances are making it easier and more economical for first-time and veteran gypsum contractors to take this step, but there are still many factors to consider. From design to durability, selecting a gypsum mixer/pump for maximum productivity and profitability must begin with the contractor’s unique needs. 

This feature appeared in the December 2019 issues of the ACP Magazines:

California Builder & Engineer, Construction, Construction Digest, Construction News, Constructioneer, Dixie Contractor, Michigan Contractor & Builder, Midwest Contractor, New England Construction, Pacific Builder & Engineer, Rocky Mountain Construction, Texas Contractor,
Western Builder

Protecting DEF from Extreme Cold and Other Conditions Can Keep Your Truck Running Smoothly

By Jeffrey Harmening, Manager – EOLCS/DEF/MOM, American Petroleum Institute

According to the Farmer’s Almanac, the winter of 2019-2020 will be filled with bitterly cold weather in the eastern parts of the Rockies and east to the Appalachians. The Northeast should also experience very cold temperatures as well. For municipalities, public utilities, landscapers and others that are involved in outdoor work and snow removal, there is always plenty of annual winter preparation.

One thing that may be overlooked is the proper management of Diesel Exhaust Fluid (DEF) used in many diesel-powered trucks. Handling and storing DEF can be challenging in wintertime for drivers filling up on the road and for shops. Made from a mixture of technically pure urea and purified water, DEF freezes at 11 degrees Fahrenheit and needs to be properly maintained and dispensed to preserve its quality.

Like water, DEF will expand up to seven percent when frozen and can damage the storage tank if it is full or nearly full when it freezes. Keeping a tank that you think may freeze less than full is a good idea. If DEF freezes in the vehicle, do not put any additives in the tank to help it melt. DEF needs to remain pure for it to work correctly. The vehicle will start without a problem and the DEF tank has a heating element that can quickly thaw the DEF.  Don’t worry; on-spec DEF is specifically formulated to allow the fluid to thaw at the proper concentration to keep your vehicle operating smoothly.

In addition to cold, there are other things to consider when purchasing, storing and handling DEF. Drivers accustomed to purchasing DEF in containers should look at the expiration date on the bottle and be sure to use it before this date as the product has a limited shelf life. If a date is not present, ask for the most recently delivered DEF products.  Also, be sure to look for the API certification mark on the bottle as well. Many diesel engine manufacturers recommend that drivers use API-licensed DEF.

Storage conditions have an impact on its quality. DEF can be expected to have a minimum shelf life of 12 months or even longer in optimum conditions. Check the label for recommended storage temperatures.  API recommends that you don’t store if for too long in your truck once you purchase it, especially if the storage area in the vehicle is routinely exposed to extreme heat or sunlight.

Purchasing DEF for Shop Use

API has found that the biggest misconception by fleet managers is the belief that if the urea concentration of their DEF is on spec, then the DEF meets the required quality. While it is true that the concentration is very important, there are many other important quality characteristics built into the ISO 22241 specification regarding DEF.

Those responsible for procuring DEF should confirm that their suppliers are providing DEF that meets the entire ISO quality standard. One way to do this is to ensure that their supplier is providing a Certificate of Analysis (or Quality) with every shipment that addresses all of the quality characteristics that the specification requires. You can also check to see if the DEF they are buying is licensed through API’s real-time directory of licensees on the API website

Managing DEF in Shops

For shops, the handling, storage and dispensing of DEF is very important so that off-spec DEF doesn’t reach the marketplace. Temperature during transport or at the point of storage or sale can harm the shelf life of DEF sold in containers. Make sure the stock is rotated to use the oldest product first. Proper storage temperatures in a shop is also vital. Storing in temperatures above 86 degrees Fahrenheit will limit the shelf life of the DEF over time. Some additional things to consider in storing and handing DEF include the following:

  • Bulk storage tanks should be dedicated for DEF. Don’t switch products in the bulk tank without thoroughly rinsing the tank with distilled or de-ionized water or on-spec DEF. 
  • A closed loop system for transferring DEF from a drum or bulk tank is recommended so contaminants don’t get into the DEF. This is particularly important in a shop or construction site that has dust or dirt in the air.
  • Use dedicated equipment for dispensing DEF. Don’t use funnels, pitchers, hoses, etc. that are used for other fluids when putting DEF in a tank. 
  • Anything used for dispensing DEF should be cleaned with distilled or de-ionized water and followed by a DEF rinse. Don’t use tap water for cleaning.

For shops and drivers, it’s important to know what you are putting into your DEF tank. The quality of the DEF going into your vehicle is as important as the quality of the engine oils or fuels used in your vehicles.  Use of API-licensed Diesel Exhaust Fluid will ensure that the DEF meets the high standards required by engine and vehicle manufacturers.

This feature appeared in the December 2019 issues of the ACP Magazines:

California Builder & Engineer, Construction, Construction Digest, Construction News, Constructioneer, Dixie Contractor, Michigan Contractor & Builder, Midwest Contractor, New England Construction, Pacific Builder & Engineer, Rocky Mountain Construction, Texas Contractor,
Western Builder

Customized Mobile Lube System Meets Unique Jobsite Needs for Beard Construction

By Todd Versteeg

More than 250 pieces of machinery working on anywhere between 12 and 15 commercial or industrial excavation jobsites across as many as seven states takes a lot of resources to keep every machine operating at peak capacity. 

It’s the daily reality for Port Allen, Louisiana-based Beard Construction, and that’s why Equipment Manager Lee Morrison relies on Sage Oil Vac systems. He recently took that relationship to a new level with a customized machine that meets the specific, unique needs of many of Beard Construction’s jobsites.

By the time Morrison joined the Beard Construction team in 2010, the company was already using Sage systems for mobile fluid changes. The company’s 25 to 30 job superintendents were already familiar with the benefits of using Sage systems for mobile oil changes and lubrication services on the jobsite after having previously worked with a local company to build lubrication units. As mobile maintenance requirements grew and evolved, Morrison saw a need for maintenance equipment that was simple, straightforward and efficient, but could accomplish more on each jobsite. 

“Our old units were standard large tank trucks with each unit having its own oil pump. The problem with those units is there are so many pumps and there’s always a leak somewhere, or there’s an issue with the plumbing or pump itself,” Morrison said. “Sage systems are so much less problematic with no pumps, and the plumbing is virtually problem-free. They’re customizable, more compact and they really hold up well.”

Designed for Specific Applications

The ability to customize Sage systems is a benefit that extends well beyond basic jobsite functionality, and it’s one that Morrison is fully leveraging with the latest addition to the 15-year-old Beard Construction maintenance fleet. On top of the two multi-tank Heritage skids and their jobsite trailer currently doing services, Morrison worked with Sage Customer Service Specialist Kyle Ottmers to build the company’s latest system from the ground up. The process started with an idea and a conversation.

“I wanted a unit designed for specific applications that only had what we needed on it and nothing else,” Morrison said. “We knew the dimensions and that we needed full containment, and we got together and sketched out some drawings and came up with what would work best. With a lot of companies, you’re at their mercy, they have what they have and if you want it customized, you have to do it at your own shop. With this Sage system, we worked together and came up with the exact rig we needed.”

The process yielded a one-of-a-kind machine. By combining a Sage lube skid with a Morooka tracked vehicle, Morrison now can solve a long-standing problem on many jobsites. Working in the southern and southeastern U.S., heavy, wet soils are common on many jobs, making it difficult for operators to maneuver large, heavy service vehicles where they need to be to perform service and maintenance. 

Customized Machine Benefits

Morrison needed a smaller, more maneuverable vehicle to get the job done. Between a Sage lube skid with a smaller physical footprint and a tracked vehicle with a 10-foot by 7-foot bed, Morrison worked with Ottmers and the Sage team to customize a maintenance vehicle with everything necessary to provide jobsite maintenance for the company’s excavators and other jobsite machinery.

“The vehicle is based on a Morooka tracked machine and a Sage lube skid. It’s not like anything we’ve ever done before. We have customized vehicles before, but this machine is unique in that it has two product tanks, a place for diesel exhaust fluid (DEF) and a place for grease,” Ottmers said. “The footprint is smaller, and the fluid containment system and different components are all pretty specialized and geared specifically to what Lee was looking for.”

The benefits of the customized machine stretch beyond productivity. It helps Morrison better manage labor, and it’s a safer, cleaner way to provide jobsite machinery maintenance. 

“Some of the jobsites we got this unit for probably have $10 million worth of equipment on them. The better you can keep that equipment serviced, the more value you’ll have in it in the long run,” he said. “This machine matches our needs 100 percent from a labor standpoint, and it helps us achieve our No. 1 priority of safety. Everything is at an arm’s reach for the operator, and the controls are simple and easy to use. And, we’re not leaking any grease or oil on the ground. That’s huge for us since being environmentally sound is important to this company.” 

Future Work with Sage 

Moving forward, Morrison expects the company’s next 15 years to build on the success of its first decade and a half. A big part of that growth and advancement will come in streamlining equipment and machinery to best meet the specific needs of the large-scale excavation jobs that are common for the company. Tools like Sage mobile lubrication systems will be a large part of that ongoing evolution. 

“As we continue to update our fleet, I want to continually add customized systems like this to our mobile lubrication lineup so that we are working with machines that meet our direct, specific needs. Gone are the days when we will work with machines that are generic and straight off the shelf. These Sage systems are low-maintenance. We believe in quality, and quality pays.”

In addition to the utility of Sage systems on Beard Construction’s jobsites, Morrison said they have already shown promise for other areas of the business. Not only do they work more efficiently, they also provide a visual representation of Beard Construction’s innovation and attention to productivity and efficiency.

“In the long run, if you buy quality equipment, it will generally pay for itself,” Morrison said. “When we go to our large industrial clients, it’s no small bid. You are selected for these large bids based on your performance, safety, innovation and how proactive you are with how you operate and the equipment you use. These machines help us get the job done and leave a better impression with our customers.”

This feature appeared in the November 2019 issues of the ACP Magazines:

California Builder & Engineer, Construction, Construction Digest, Construction News, Constructioneer, Dixie Contractor, Michigan Contractor & Builder, Midwest Contractor, New England Construction, Pacific Builder & Engineer, Rocky Mountain Construction, Texas Contractor,
Western Builder

Equipment Leasing and Finance Industry Confidence Up Again in December

The Equipment Leasing & Finance Foundation (the Foundation) releases the December 2019 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) today. Designed to collect leadership data, the index reports a qualitative assessment of both the prevailing business conditions and expectations for the future as reported by key executives from the $900 billion equipment finance sector. Overall, confidence in the equipment finance market is 56.2, an increase from the November index of 54.9.

When asked about the outlook for the future, MCI-EFI survey respondent Valerie Jester, President, Brandywine Capital Associates, Inc.,  said, “We are experiencing a strong finish to the year and the fourth quarter. Given all the distractions of the national political stage I am a bit surprised. The tariffs that were imposed earlier in the year are having their effect on certain industries, but we continue to see good investment in equipment with the predominance of our customer base. I believe many have learned to tune out the ‘noise’ and focus on the necessities to compete in today’s markets. Waiting to make certain equipment investments is just not optional if you want to stay in the game.”

December 2019 Survey Results:
The overall MCI-EFI is 56.2, an increase from 54.9 in November.   

•   When asked to assess their business conditions over the next four months, 10.3% of executives responding said they believe business conditions will improve over the next four months, down from 13.3% in November. 82.8% of respondents believe business conditions will remain the same over the next four months, an increase from 73.3% the previous month. 6.9% believe business conditions will worsen, down from 13.3% in November.

•   10% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, a decrease from 13.3% in November. 76.7% believe demand will “remain the same” during the same four-month time period, an increase from 63.3% the previous month. 13.3% believe demand will decline, down from 23.3% in November.

•   20% of the respondents expect more access to capital to fund equipment acquisitions over the next four months, 80% of executives indicate they expect the “same” access to capital to fund business, and none expect “less” access to capital, all unchanged from November.  

•   When asked, 30% of the executives report they expect to hire more employees over the next four months, an increase from 26.7% in November. 63.3% expect no change in headcount over the next four months, a decrease from 73.3% last month. 6.7% expect to hire fewer employees, up from none the previous month.

•   23.3% of the leadership evaluate the current U.S. economy as “excellent,” up from 16.7% the previous month. 76.7% of the leadership evaluate the current U.S. economy as “fair,” down from 83.3% in November. None evaluate it as “poor,” unchanged from last month.

•   13.3% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, up from 10% in November. 80% of survey respondents indicate they believe the U.S. economy will “stay the same” over the next six months, an increase from 76.7% the previous month. 6.7% believe economic conditions in the U.S. will worsen over the next six months, a decrease from 13.3% in November.

•   In December, 23.3% of respondents indicate they believe their company will increase spending on business development activities during the next six months, a decrease from 30% last month. 73.3% believe there will be “no change” in business development spending, an increase from 63.3% in November. 3.3% believe there will be a decrease in spending, down from 6.7% last month.

December 2019 MCI-EFI Survey Comments from Industry Executive Leadership:

Independent, Small Ticket
“We’re more hopeful than optimistic that there is pent-up small business capital equipment demand that will release and spur increased financing volume. We wonder whether the trucking recession is the canary in a coalmine for future problems, or an isolated sector problem.” Quentin Cote, CLFP, President, Mintaka Financial, LLC,

Bank, Small Ticket
“Our volume, credit quality and portfolio performance have all remained strong. Economic indicators are positive. Moving into an election year and the uncertainty that comes with it may cause stagnation.” David Normandin, CLFP, President and CEO, Wintrust Specialty Finance

Bank, Middle Ticket
“Demand for financing within our core commercial & industrial loan business remains steady, and the pipeline is strong into the beginning of 2020 indicating continued pent-up demand for capital expenditures. Money costs remain at all-time lows, which may continue to fuel growth. Unemployment numbers continue to decline. Admittedly there is uncertainty in some sectors such as rail, but these seem to be cyclical in nature and focus primarily around energy. We do anticipate growth in the plastics sector to offset some of this.” Frank Campagna, Business Line Manager, M&T Commercial Equipment Finance

Why an MCI-EFI?
Confidence in the U.S. economy and the capital markets is a critical driver to the equipment finance industry. Throughout history, when confidence increases, consumers, and businesses are more apt to acquire more consumer goods, equipment, and durables, and invest at prevailing prices. When confidence decreases, spending and risk-taking tend to fall. Investors are said to be confident when the news about the future is good and stock prices are rising.

Who participates in the MCI-EFI?
The respondents are comprised of a wide cross-section of industry executives, including large-ticket, middle-market and small-ticket banks, independents, and captive equipment finance companies. The MCI-EFI uses the same pool of 50 organization leaders to respond monthly to ensure the survey’s integrity. Since the same organizations provide the data from month to month, the results constitute a consistent barometer of the industry’s confidence.

How is the MCI-EFI designed?
The survey consists of seven questions and an area for comments, asking the respondents’ opinions about the following:
1.   Current business conditions
2.   Expected product demand over the next four months
3.   Access to capital over the next four months
4.   Future employment conditions
5.   Evaluation of the current U.S. economy
6.   U.S. economic conditions over the next six months
7.   Business development spending expectations
8.   Open-ended question for comment

How may I access the MCI-EFI?
Survey results are posted on the Foundation website, https://www.leasefoundation.org/industry-resources/monthly-confidence-index/, included in the Foundation Forecast eNewsletter, and included in press releases. Survey respondent demographics and additional information about the MCI are also available at the link above.