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Large or small, electrical contracting companies have a significant investment in tools. To protect that investment, it is necessary to know where those tools are. The larger the company, the more tools to account for.
As computers came into wide use, their value for keeping track of tools seemed obvious. Many contractors created systems for that purpose, while outside companies developed programs for “tracking” tools and other inventory.
Simple tracking systems have evolved to include true tool management capabilities that can positively affect a company’s bottom line. As these systems have advanced, they have become easier to put in place and use, and suppliers cite a relatively fast payback on investment.
Even so, only about half the country’s electrical contractors are using a purchased tool tracking system, said Don Kafka, president of ToolWatch.
“About 30 percent are using some other form of tracking, such as Excel, white boards or a homegrown method, and the remaining 20 percent are not using anything,” he said. “Automated tracking and management systems can significantly reduce tool loss, improve warehouse and job-site productivity, and provide detailed job cost and billing information. It will reduce unscheduled downtime, improve safety reporting and reduce liability exposure. In the past three years, we have seen a shift to cloud-based and mobile applications. These applications allow multiple people in an organization to securely access the tool management system from anywhere at anytime.”
ToolWatch, CribMaster and GigaTrak provided information for this report. Trimble AllTrak (formerly Accubid), did not respond to the invitation to participate.
“True tool management systems go far beyond tracking location; they provide the critical information necessary to make business decisions that impact an organization’s operational and financial performance,” Kafka said.
“ToolWatch’s Enterprise is a comprehensive system to manage tools, equipment, materials and consumables,” he said. “The cloud-based application is easy to use and securely stores critical information about warehouse and field operations in one centralized database. The system also includes the supporting modules, such as service and calibration, purchasing and receiving, and job cost and billing.
“The subscription service is priced so even the smallest contractors can enjoy the same software that the largest contractors are using. Most of the cost for initiating a system is tied to training and mobile scanning devices. The typical system starts with an annual subscription for one user, a mobile bar code scanner and web training for about $8,000. The Enterprise subscription that includes all software modules is $150 per month.
“Tools, equipment and materials are identified and tagged with bar codes, RFID tags or global positioning system [GPS] tags. As these items move from the warehouse to job sites or to employees, they are scanned and recorded electronically. These transactions then provide all of the data necessary for job cost and billing, tool management, inventory management, service management, reporting, and more.
“Beyond the cost of the subscription, an organization must dedicate personnel to identifying and tagging tools, equipment, materials, and learning the new system. We provide three training options: live online training with real-time instructors, classroom training at our training center in Denver, and a series of online lessons through our ToolWatch University. These costs are dependent on the size of the organization. However, the return on investment is almost always recouped within six months, no matter what the size of the organization.
“Once the system is in place, it is designed to be as transparent as possible to the warehouse and field operations. As items are scanned and loaded onto trucks, automation in the background is adjusting inventory levels, generating job cost information, billing information, reorder information, etc.,” Kafka said.
Susan Hebrank, marketing services coordinator, said: “Lost tools are no longer accepted as the cost of doing business, but attempting to keep track of tools using manual data entry to log inventory transactions is error-prone.
“With a computer-based inventory-management system, the entire tool management process is automated to provide the control and accountability required to allow employees to get to their jobs and proceed with their work without interrupting workflow.
“A tool-tracking system establishes a basic level of accountability with employees or contractors authorized to have use of the tools. The system tracks who removed the tool and when it was returned. It is a reality that, in any productive environment, tools get lost, misplaced, or are returned unusable. An effective tool management system tracks and monitors tool movement in and out of the cabinet and reduces the search time to locate the missing tool. It also manages tasks such as equipment calibration and gauge testing, tracks historical data by cost center, generates detailed reports to identify cost-savings opportunities, and automates the replenishment process. [The] user-friendly interface enables contractor compliancy by removing steps in the process to issue and return tools.
“Effective inventory management and tool control is paramount for contractors of any size. It’s important to start with a system that has the capability to easily upgrade for further control as a company grows or needs change.
“CribMaster is a leading provider in inventory management and radio frequency identification [RFID] tool control solutions. With RFID-embedded hand tools paired with software and RFID tracking devices, companies have the ability to manage, monitor and trace tools anywhere in their facilities. Passive issue technology utilizes RFID and weight-sensing technologies to allow the user to simply get the items required to the task at hand in the shortest amount of time possible. With the RFID-embedded tools, the setup time is greatly reduced by eliminating the process of adhering the tag to the tool. With ergonomic designs, it is no longer necessary to sacrifice comfort or functionality. Additionally, in discovery mode, the software automatically recognizes each tag, enabling rapid deployment of the complete tool tracking system,” Hebrank said.
Robert Hagerman, GigaTrak’s founder, said: “Tool tracking is limited to informing management of where a tool is and who has it. True tool management covers the life cycle of a tool and also includes planned and unplanned maintenance history and costs, proper usage, warranties, and total cost of ownership. Tool management solutions save organizations owning tools time, money, and provide information about tool usage, which impacts the true profitability of specific jobs.
“The GigaTrak Tool Tracking System [TTS] is for small to mid-sized contractors for managing their tool investment, consumables, kitted materials and rented items. We also offer Stores Tacking System [STS] for contractors to specifically manage consumables that are used on the job site. It includes inventory and purchasing features.
“The advent of solutions like GigaTrak TTS make it more feasible for small to mid-sized contractors to benefit from this simple and easy-to-use technology. Our solution is very easy to manage. The design is focused on the user with the goal of keeping usage simple. Once up and running, contractors will wonder how they ever lived without it.
“We offer a complete solution that consists of the software, hardware, training and startup, if needed. Two things that are key: the first is availability of information in the field, and the second is something that we call BYOD—bring your own device. Customers are beginning to embrace using devices in a real-time fashion outside of the four walls with web portals. Even though industrial handheld barcode terminals work best inside the four walls, the use of PCs, tablets and smartphones in the field allow employees access to information to make better and timelier decisions.
“Tool management reduces losses by holding employees and jobs accountable for the equipment they are provided. Each tool can be quickly located, and the system provides a report of what is in the employee’s possession. By automating the management of tool inventory, a solution normally pays for itself in just months.
“The cost for an average-sized contractor to be up and running is $6,000. Basic tool management starts at $2,000. Our solution can be easily enhanced if more features are required in the future.
“The largest investment isn’t the cost of the solution itself. It is the commitment to change the way a contractor manages their business, specifically capital assets like tools. The days of running a business with clipboards and spreadsheets no longer makes sense. The cost of doing nothing is too high with the increasing competition that contractors are facing.
“Adoption of tool management programs definitely is growing, and, with more cost-effective solutions hitting the marketplace, using technology to manage tools will become the norm in the next five years,” Hagerman said.
Another solution was introduced at press time by Dynamic Systems Inc.CheckMate software reduces the time it takes to locate equipment and ensures that items will not be lost or left behind after a job. CheckMate records where the item is, who has it and when it is due back. The software includes a Maintenance Module that records repairs, schedules regular periodic maintenance, records warranty expiration dates, and tracks vehicle service and registration renewals.
Dynamic Systems offers a variety of barcode labels, including metal tags. The introduction of metal tags enables users to track items where a typical barcode label would not adhere.
“Loss of tools or equipment and damaged or nonworking equipment are major overhead costs that can be contained with a well-designed tracking system. Our customers see a typical payback for the CheckMate Equipment and Tool Tracking System within three to four months,” said Alison Falco, Dynamic Systems’ president.