Since Butler Transport began using the Kenworth Premier Care Connect Plus maintenance management system, the Kansas City KS-based trucking company has shaved its parts inventory costs by 60%.
“Before we began using the system, our parts inventory was about $175,000,” said Paul Arnold, Butler shop manager. “With PremierCare Connect Plus, we've dropped that to the $60,000 to $70,000 range. Instead of keeping an inventory of seven to 10 days, we've cut it down to one to two days. The program tells us how often different parts are needed based on usage. That allows us to stock the right number of fast-moving parts and to reduce or get rid of parts that aren't used often. That saving is put to work elsewhere in our company.”
Kenworth introduced PremierCare Connect Plus in 2003 as an upgrade of the PremierCare Connect fleet maintenance management program. Customers tested the program for 18 months and reported favorable results.
The new system gives medium and large fleets an online tool to manage their parts and maintenance expenses. It is a flexible system that can be customized and integrated with different accounting systems. This eliminates double-entry of data, ensures tighter cost controls, and improves management of parts, labor, and receivables. By monitoring a fleet's shop labor costs and parts usage, Connect Plus is able to provide detailed, accurate, and timely cost-per-mile data for each truck.
Arnold said that besides making the parts inventory leaner, Connect Plus has helped Butler's maintenance department become more productive. A Connect Plus report that projects the time needed to perform preventive maintenance and other work enables Arnold to schedule mechanics' time. He also can monitor technicians to see how they match the projection.
“The Connect Plus reports enabled us to reduce indirect labor costs by 20%, which means more time devoted to repair and maintenance work,” Arnold said.
Arnold gets a monthly maintenance report — soon to be bi-monthly — on each of Butler's 250 tractors, including its 150 Kenworth T600s, T2000s, and W900s. The company also operates 340 refrigerated trailers.
Another PremierCare Connect Plus customer, Giant Industries of Bloomfield NM, recently started using the system after struggling with a competitor's inventory management program.
“We wanted a system to track our mechanics and their time, create invoices, reduce our daily inventory, monitor parts usage, and give us real-time information,” said Leo Marquez, maintenance manager for the petroleum products company. “With Connect Plus, they customize the program to our needs. Since it's online-based, we get the changes in no time at all.”
Giant operates 80 tanker trucks, most of which are Kenworth T800s and W900s. It delivers crude oil to its refineries in New Mexico and fuel products to retail stations or corporate customers. The company maintains its own trucks at one facility in New Mexico. A New Mexico parts warehouse provides parts for 100 trucks in the state.
“Within three months, our goal is to reduce our $250,000 parts inventory by $100,000,” Marquez said. “We also want to reduce our parts inventory by 1,000 items. With Connect Plus, we can keep track of what parts are infrequently used and get them out of our inventory.”