july2023 - 19

[ FINANCES ]
W
hen Milwaukee County Transit System's
maintenance garage got a push from county
officials to start electrifying their fleet,
management knew it was time for some equipment
upgrades to their shop.
Management's first concern was dealing
with the significant weight capacity increase
their lifts would need going from 13-ton diesel
buses to 18-ton electric ones.
MCTS' Ron McCorkel, director of maintenance,
and Dwyane Reese, deputy director of
maintenance, went right to pricing new lifts
that could hold the extra weight. And thanks
to their budget strategy for capital improvements
calculated every five years, they were
able to purchase 14 Stertil-Koni in-ground telescopic
piston DIAMONDLIFTs and 16 Mobile
Column Lifts.
" We had to make sure that we invested in
some equipment that would take us into the
next 15-20 years and plan just in case the next
group of buses gets heavier, " McCorkel said.
No matter the size, all fleet maintenance
operations must accurately estimate their
budgets to keep up with changes in equipment
and technology, as well as offer competitive
wages to increasingly in-demand labor.
Tracking the known
Transervice Logistics uses a home-grown
system that tracks the number and age of
their assets, predictable and demand maintenance
needs, and labor costs to calculate
their budgets. One critical metric they track
is wearable component replacement.
" We can look at brake pads and know what
those parts cost today and calculate how often
we will need to replace them over the life of
the vehicle, " said Michael Dominguez, VP of
business operations at Transervice. " We do
an analysis based on the number of miles the
vehicle will operate each year, factoring for
both normal wear and tear and severe conditions,
the expected life span for the vehicle,
and where it will be operated. We couple that
with our manpower formulas for labor cost. "
Focusing on part life also helps a shop
reduce the incidents of emergency repairs,
which lead to higher unexpected costs. That
predictability helps manage a budget more
effectively, according to Robert Ziemba,
marketing lead at Decisiv, a provider of service
relationship management solutions.
The company recently developed calculators
to help predict revenue increases. Decisiv
also focuses on optimizing repair events,
which helps fleets avoid taking trucks back
out of service and taking a hit on the revenue
side. This helps both the cost management and
revenue generation side of the budget, said
Mark Wasilko, VP of marketing at Decisiv.
" A Decisiv calculator won't help budget, but it
will remind you of the reason to do it, " Wasilko
said. " If you're on a platform and you're proactive,
then you're optimizing the service schedhamzaturkkol
| 1396139907 | Getty Images; 39509108 | Taesmileland | Dreamstime
July 2023 | FleetMaintenance.com
19
» Truckway's maintenance manager, Eric Silz,
said that even the newest tech software and
the smartest accountants in the industry
could not have budgeted for the unpredictable
costs incurred in recent years, including the
additional diagnostic laptops and software
needed to troubleshoot the many different
types of vehicles at each Truckway facility.
Truckway
Current challenges
in budgeting
Planning for new equipment
While Americans continue to pivot their
spending for inflation, forecasting equipment
sales specifically in today's equipment
market remains challenging, Transervice's
Dominguez explained.
Silz agreed, adding that even the newest
tech software and the smartest accountants
in the industry could not have budgeted for
the unpredictable costs incurred in recent
years, including the additional diagnostic
laptops and software needed to troubleshoot
the many different types of vehicles at each
Truckway facility.
" A typical trucking company may run a fleet
of 100 vehicles, all the same make and model
trucks, " Silz said. " In the leasing and contract
maintenance business, we find ourselves
uling and the work that you've done and more
intelligently budgeting repairs. "
Sometimes the best predictor of the future
is to look at the past. Truckway Leasing, a
full-service commercial leasing, rental, and
maintenance provider, bases its maintenance
budget on a percentage of revenue derived
from historical costs.
Eric Silz, Truckway's maintenance manager,
said that's easier said than done. Those historical
costs have to contend with the low mileage
rates they are forced to charge, skyrocketing
dealer labor rates, and increased parts and tire
costs. But in the rental and leasing world, the
more units on the road, the more the revenue
will increase.
A poorly planned budget has a direct effect
on a shop's bottom line, ultimately impacting
the employees, Silz said.
http://www.FleetMaintenance.com
july2023

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