Scaffolding rental maximize ROI

How to Maximize Your Scaffolding Business ROI

Do you have excess inventory gathering rust in your scaffold yard? Then, you could be missing out on an easy way to maximize your utilization and cash flow.  

The scaffolding rental market is projected to grow at 5.32% from 2018-2022 (source). Renting out scaffolding and equipment can help you expand your business and diversify your revenue stream.

While it is a highly lucrative business, many scaffolding vendors struggle to attain the levels of success they desire. 

Without the right inventory management systems in place, managing all of the moving parts involved can become a nightmare. 

In this blog post, you will learn more about the secrets to maximizing ROI with scaffolding re-rentals.

What Are the Challenges for Scaffolding Rental Business Owners?

First and foremost, a lack of inventory management is the biggest obstacle to running a rental business. Without the right forecasting, management, and invoicing systems in place, you could find yourself exposed to any number of risks, as described below.

Inventory Control

Most scaffolding firms still rely on spreadsheets and paper-based shipping documents for asset management and rental inventory tracking. These approaches are error-prone and full of costly inefficiencies.

Shipping documents are often duplicated or triplicated to track scaffolding rentals from the yard to job site, and back. But they aren’t always properly checked and signed. 

In some cases, the shipping list gets lost, making it difficult to keep track of rental equipment coming in and out of the yard. When the shipment arrives, it is not counted correctly due to the lack of verification against shipment. This makes it difficult  to capture over-shipments or missing components as they travel back and forth between yard and job site.

Another common problem is the lack of a formal count sheet or inspection procedure for rental inventory, thus limiting your visibility into stock levels. While some generic software can handle trackable items with serialized numbers, bulk assets don’t get accounted for over time. Without regular inventory counts, businesses can lose a fortune due to lost or stolen inventory. 

Unfortunately, this is the reality for many scaffolding businesses.

Billing and Invoicing

Inaccurate order tracking also causes all kinds of headaches to the folks in accounting. They rely on physical count of the stock to identify discrepancies between inventory records and the actual stock in hand. 

Missing or damaged components that fell off your radar end up not being billed at all. Mistakes in invoicing could cost your company hundreds of thousands each month. And this is where the nightmare begins. You can’t charge customers for repair or replacement costs if these problems get discovered too late. At the same time, a drop in inventory due to equipment failure could lead to unplanned downtime, affecting your rental activities. 

Yes. Running a successful rental business isn’t easy. 

Don’t pour your money down the drain with inefficient paper- or spreadsheet-based systems or manual inventory records.

We built Quantify to help you automate your rental management, so you can focus on closing deals and improving inventory turnover.  

“Quantify took us from tracking being almost an impossibility to being able to do it with a couple of clicks.”

– Jack Dalrymple, Commonwealth’s director of branding and operations

Learn how you can leverage a modern scaffolding inventory management system to manage your rentals with ease. 

Quantify: Intuitive and Powerful Solution for Profitable Scaffold Re-Rentals

Quantify offers an all-in-one platform that can streamline your workflow and boost re-rental profitability for both internal and external use. Keep reading to learn how Quantify solves common challenges in scaffolding inventory management and billing.

External use

You can either import product quantities into the estimate or create a new estimate for rentals based on the current inventory located at the job site:

product quantities and estimates
Quantify Estimates

Then, issue the delivery order from your estimate:

Quantify Shipping and Logistics
Shipping and Logistics

The best part? You can manage the entire rental fleet to ensure accurate stock levels for all customers in one place:

Working with multiple rental fleet
Working with Customers

As mentioned above, you can generate invoices for all charges, including billable amounts for rent and sales of consumable items. You can integrate Quantify with major accounting tools like QuickBooks, Oracle, and Xero, among others.

With inventory tracking, Quantify will immediately flag missing items when they don’t make it back from the job.

Inventory Tracking
Inventory Tracking

Internal use

Quantify integrates seamlessly with Scaffold Designer. This means that with just a click you can generate the materials list for your project in Scaffold Designer. Then, you can export it to Quantify to cross-check inventory and manage your project. 

Need to make changes to your plan on the fly? You can edit the Bill of Materials, such as adding parts and quantities, and then create instant estimates for your end-users. 

Sharing and managing scaffolding material lists
Sharing and managing scaffolding material lists has never been easier. 

Besides monitoring rented items and prices during shipment and return. You can also manage ongoing hire billing by items. 

These are just a few of the ways Quantify helps you unlock your company’s profit potential through re-rentals. See others below!

How to Maximize Revenue with Scaffolding Rentals

Beyond inventory management capabilities that you can find in generic software, Quantify takes into consideration every detail that goes into running a profitable scaffolding business.

Maintaining scaffolding utilization rate

Specialized software like Quantify allows you to manage cross-hire in line with your stock record. This way, you can collect data for inventory utilization forecasts.

Generic accounting software only reveals utilization trends over time, meaning you’re not able to use it to determine your actual capacity to handle an upcoming job. Quantify solves this problem with instant inventory utilization reports, enabling you to monitor your utilization rate in real time.

For instance, if you are already utilizing 90% of your current inventory, you may not have enough equipment to serve the next customer coming through the door. Or, if your utilization rate is below 70%, you may be leaving money on the table with too much equipment in the yard.

Ideally, you should aim for a 75% to 80% utilization rate for your equipment fleet to ensure a healthy inventory for immediate demand, and consistent revenue stream. 


Related: 5 Critical Metrics Every Scaffold Business Needs to Know


Generating revenue from the sale of consumable items

With Quantify, you can also sell consumable items that go to a job but never come back. If you have a good stock of items like gloves and harnesses, for example, you can make a profit from them. Quantify enables billing and invoicing of consumable parts as well. 

Increasing profit margins with asset valuation

Inside Quantify, you have the ability to track the list price of your equipment purchases and set your rental price based on various costing factors such as average cost..

By blending the original cost into total average fleet cost, you can ensure higher ROI from the monthly rental rate, no matter what happens with daily business transactions.

For example, if you purchase 100 items at $3 per piece and another 100 items at $6 per piece, your average cost is $4.50. Then, you can charge a fixed percentage of the list price ($4.50) as a standard rental rate.

Using an accounting software, you can also track the total asset value and take a depreciation deduction on your tax return to improve profit margins.

Think Scaffolding Business. Think Quantify.

To run a wildly successful scaffolding business, you first need to get organized, especially when dealing with high-volume equipment rentals. Leverage Avontus technology to streamline your processes, add efficiency to operations, and maximize your profit the right way. 

Track your asset movements with real-time inventory visibility.

Improve accounting efficiency with fast and accurate billing automation.

Gain insights into your business with industry-specific software solutions.

Are you ready to reinvent your scaffolding rentals? Get in touch with our team for a personal Quantify walkthrough!

critical metrics scaffold business

5 Critical Metrics Every Scaffold Business Needs to Know

“Domino’s 30-Minute Delivery or Free Pizza” is not just a marketing gimmick. It’s also a quality metric that measures the efficiency of the company at delivering goals (and, of course, pizza).

With performance metrics, you can evaluate how successful your business operations are at accomplishing key company objectives. Most importantly, you can swiftly make amendments should the metrics show a downward trend. 

But there are a lot of performance metrics, and using them all is not practical or helpful. They key is to choose metrics that can accurately and concisely reflect your company’s main objectives.

In today’s blog post, we’ll let you in on the five critical metrics that the most productive and profitable scaffolding businesses use to track their success. 

Using Company Objectives to Establish Meaningful Metrics

For mariners, a lighthouse serves as a navigational tool and warns them of potentially dangerous areas. In the business context, performance metrics function as the lighthouse for organizations. 

These metrics guide your company to accomplish goals successfully by evaluating the effectiveness of business operations. They keep your company afloat by quickly revealing activities that fail to achieve business goals.

Since these metrics can make or break your business, it’s important that you establish meaningful metrics based on your scaffolding company’s key strategic objectives. This way, when you achieve your Key Performance Indicator (KPI), you’ll successfully accomplish important business objectives too. 

For most scaffolding businesses, key objectives and the corresponding metrics may revolve around the following important departments.  

Finance Department

  • Key Objective 1: Achieve and maintain high profitability
  • Key Objective 2: Maintain healthy cash flow
  • Key Objective 3: Minimize inventory losses

Customer Service Department

  • Key Objective 1: Provide excellent customer service
  • Key Objective 2: Attract and retain profitable customers

Operations Department

  • Key Objective: Achieve and maintain high yard productivity

Note that the objectives are all long-term and help paint the big picture about what’s important to your scaffolding company. 

The next step is to match these objectives with appropriate metrics so that you can monitor the progress of said objectives regularly.

More on that below.

Critical Metrics That You Must Know to Achieve Your Company’s Business Objectives

We’ve narrowed down five critical metrics that can successfully steer your scaffolding company and operations in-line with important long-term key objectives. 

1. Inventory Accuracy

This metric is crucial, especially for a business that relies on accurate inventory counts to maximize profitability. 

Inventory Accuracy can be interpreted differently by various departments in your scaffolding business. For example, the Finance department may calculate it in terms of dollar value. Their goal would be to ensure that the dollar value of scaffolding materials in the ERP system and those out in the yard match. On the other hand, the Sales department’s take on Inventory Accuracy is even more straightforward in terms of actual scaffolding material counts. 

💡 How to calculate: The difference between physical goods and inventory items reported by ERP software or department.

No matter the approach, Inventory Accuracy helps you to gauge if you have adequate scaffolding pieces to furnish your customer’s project. Besides that, it also gives a clue if your bookkeeping and data management practices are working well for your company. A high discrepancy between physical scaffolding pieces and inventory items in the system could be due to theft or human error at manual data entry. And if left uncorrected, these problems could affect your company’s profitability. 

🎯 Target: Aim for the difference to be as low as possible.

2. Rental Rate

This is why regular inventory audits throughout the scaffolding process – in yard/depot, before shipping to customers, at the customer’s jobsite, and after a job – is crucial. While the practice of conducting cycle counts is advantageous, take it up a notch by leveraging innovative technology like ERP accounting software and barcodes. With one-stop ERP solutions like Quantify, you can easily barcode serialized and non-serialized items for efficient inventory management.  

Another equally important metric for a scaffolding business is the Rental Rate, as it’s directly responsible for your company’s cash flow and profitability. There are many factors that can influence Rental Rate; one of them is the type of scaffolding material that you provide to your customers. Usually, systems scaffold fetches a higher Rental Rate because it’s easier and faster to erect; thus, efficiently reducing the customer’s labor costs and project timeline. Additional expenditures like labor and transport costs can also inflate or deflate your Rental Rate.  

💡 How to calculate: The total rental revenue that you receive for each piece of scaffolding item. 

An accurate Rental Rate also cements your company’s reputation as a competitive and reliable scaffolding business. We know how cutthroat the scaffolding industry can be, where frequently the lowest scaffolding bids win! So, be sure to merge the original cost of your scaffolding materials into the total average fleet cost to ensure higher ROI from your Rental Rate, regardless of your business operations. 

🎯 Target: Aim for accurate and competitive Rental Rates.

With an automated scaffold management system, you can easily manage Rental Rates and successfully recoup costs incurred due to maintenance, storage, administration, etc. 

3. Time Utilization Rate

While you can always rent out various scaffolding materials, you must understand the value – in terms of productivity and monetary – that each piece brings to your company. You can measure the former via Time Utilization. In simpler terms, this performance metric tells you how often a scaffolding item is being rented out.

💡 How to calculate: Items on rent against items owned. The items could be by scaffolding piece or total value of equipment.

Knowing which scaffold inventory is heavily rotated can also guide you to track items that require servicing for optimal performance. You can even create a routine maintenance period for high-value scaffolding parts. 

Too high a Time Utilization Rate is bad, as you may have to turn away potential customers if your materials are always away for use. In contrast, a low Time Utilization Rate could mean that the scaffolding item is not being sought after by your customers. Or perhaps you have too many of the same item. Try to avoid this as the cost of storing and maintaining these items can quickly add up and affect your company’s long-term profitability.

🎯 Target: Aim for a 70% to 80% Time Utilization Rate for optimal inventory usage.

4. Financial Utilization Rate

Combat too low and high Time Utilization rates by keeping rental rates of the scaffolding materials low and high, respectively. For example, if your scaffolding item is not heavily rotated, you could always reduce its rental rate within a reasonable limit to capture more demand.

The next vital metric is Financial Utilization Rate. To put it simply, this performance metric indicates the scaffolding item that’s bringing your company the big bucks. You can then manage its supply chain for higher ROI. Financial Utilization Rate is usually measured throughout an item’s lifetime; or, the shortest time period is over a year. 

💡 How to calculate: Cost of scaffolding items at rent against the total cost of scaffolding materials. 

For example, if your scaffolding materials cost a total of $1,000,000 and you have rented out $900,000 worth of scaffolding pieces, then your Financial Utilization Rate is 90%. Watch out for too low of a Financial Utilization Rate as it could mean that your rental rate is either too low or too high. The former prevents you from getting adequate ROI from each job. While the latter simply makes it difficult for you to win bids. 

Or it could also mean that you’re offering scaffolding items that are not commonly used in construction projects; hence the low demand and poor utilization. In the long run, this could drain your business of its profit. Ideally, your scaffolding items should have high rates for both Time Utilization and Financial Utilization. 

🎯 Target: High Time and Financial Utilization rates.

5. Day Sales Outstanding (DSO)

Reach this target by achieving the right balance between sending out scaffolding items to generate revenue and cover business expenditures while ensuring that they’re not out for too long. Not only that, consider increasing the quantity of items with high Financial Utilization Rate to ensure sustainable productivity and profitability. 

A business is nothing without its customers and, of course, their payments. Keep track of your customer invoices and how quickly you are collecting payment from your customers via Days Sales Outstanding metric. 

💡 How to calculate: The amount of accounts receivable divided by the total credit sales in a certain period of time. The number is then multiplied by the number of days in that period of time. 

A standard DSO schedule is usually categorized in a monthly, quarterly or annual basis. However, it’s important that you collect outstanding accounts receivable as quickly as possible so that you can put the cash to use efficiently.

Elevated Days Sales Outstanding could mean that you have slow-paying customers or that your business is slowing down. So, implement appropriate corrective and preventive actions to nip these issues in the bud. For example, if your customers aren’t paying on time, charge late payment fees. Alternatively, offer reasonable discounts for early payments to encourage customers to pay on time. Also use this metric to cultivate a healthy list of customers by weeding out slow-paying ones.

For seamless invoicing and bill tracking, leverage an automated and comprehensive scaffold management system. With it, you can customize billing and invoicing options based on different rent rates and job costs. 

Tracking Performance Metrics via Quantify for Sustainable Scaffolding Productivity and Profitability

From increased productivity to assured profitability, leverage an all-encompassing scaffold management system like Quantify. 

With Quantify, easily accomplish important business objectives and get real-time data to see the progress of your metrics. Most importantly, make data-backed business decisions for optimal company performance.

Want to see Quantify in action? Just check out these videos

Formwork Planning & Inventory Management with Trimble and Avontus

This article was originally published at Tekla Warehouse

Concrete contractors face unique challenges when estimating, planning, and managing their formwork operations. In addition to needing an accurate and understandable design, inadequate planning can result in costly delays that affect the entire project. And, knowing when and where equipment is needed is essential. Trimble and Avontus have partnered to help concrete contractors with these challenges.

 

“Tekla Structures, including its unique concrete pour planning and formwork tools, has been a game changer for our customers” says Andy Dickey, Business Development Manager at Trimble.  “Our powerful 3D modeling and BIM capabilities make creation of detailed formwork plans faster than ever before.  Contractors have full visualization into how formwork is planned and can more efficiently manage and coordinate their work.”

 

Enhancing Trimble’s commitment to improving operational efficiency, Trimble has partnered with Avontus, driving a more streamlined and productive way for concrete contractors and formwork providers to estimate, plan and manage their formwork operations. The equipment information in detailed formwork models created with the Tekla Structures is now integrated into Quantify, Avontus’ inventory management software.

 

“The bottleneck in inventory management has always been the lack of an easy-to-use bill of materials.” — Brian Webb, CEO/Founder of Avontus

 

“When shipping equipment for multiple pours to a site, it’s very important to consolidate formwork materials into a unified list. These lists are used to ship exactly what you need to the site to get the job done, as well as to return formwork as soon as it’s no longer needed.”

 

Joining Tekla Structures with Quantify takes the industry to an entirely new level. Formwork modeling and detailing is now integrated into a fully-featured equipment management suite.

 

“Whether a small concrete contractor or a large multi-national formwork provider, the combination of Tekla Structures and Avontus Quantify allows those planning and managing formwork to solve bigger problems. This new integration between our software will vastly improve their operations.” Dickey says.

 

Learn more about Tekla solution for concrete contractors

Download Quantify Pour Sync in Tekla Warehouse (available for customers in maintenance)

 


Tekla Software by Trimble

Tekla software solutions for advanced BIM and structural engineering are produced by Trimble. Trimble’s construction offering ranges from total stations to advanced software, giving the industry tools to transform planning, design, construction and operation of buildings. Tekla software is at the heart of the design and construction workflow, building on the free flow of information, constructible models and collaboration. Information about Tekla software: www.tekla.com

 

Trimble

Trimble is transforming the way the world works by delivering products and services that connect the physical and digital worlds. Core technologies in positioning, modeling, connectivity and data analytics enable customers to improve productivity, quality, safety and sustainability. From purpose built products to enterprise lifecycle solutions, Trimble software, hardware and services are transforming a broad range of industries such as agriculture, construction, geospatial and transportation and logistics.

 

Quantify

Quantify makes managing your formwork business easy. From one user-friendly program, you can monitor inventory, ship materials, generate invoices, job costs, set reminders, manage re-rentals, and oversee all of your projects. Using your custom catalog, Quantify will track where every piece of equipment is and calculate how much you’re owed in rental. Anytime you want to know more, just run a custom report. You’ll stay on top of your business and free up countless hours. Information about quantify: www.avontus.com

 

Avontus

Avontus’ has been producing quality software since 2002, focused exclusively on the formwork, shoring, and scaffolding industries. Their easily-operated and thoroughly tested software is the most technically advanced in the industry.

Quantify Cloud and Designer Pay-As-You-Go

Originally posted on Monday, June 2, 2014

See the complete newsletter here.

Affordable software to manage your scaffold, formwork, or industrial services company.

PICK YOUR PRICE

Introducing cloud and pay-as-you-go pricing options for all Avontus software products. On-premise or in the cloud, it’s your choice. With a small startup cost and a minimal monthly fee, you can have the best software available for scaffolding, formwork and industrial services companies.

SWITCH EFFORTLESSLY

You can start with a budget-friendly cloud-hosted or pay-as-you-go solution, and as your company grows, you can quickly convert to on-premises, if needed.

QUANTIFY CLOUD

The exact same feature-rich version of Quantify is available in the cloud. Quantify was built from day 1 to evolve with the ever-changing needs of scaffolding, formwork, and industrial services companies. Quantify Cloud offers a low-cost, server-free solution without any per-user charges. This includes our fully-featured API, which allows your developers to tie our logic and data into your custom back-office solutions. With a single monthly fee, all of your customers and employees can do exactly what they need to do, all with no IT involvement.

  • 99% up-time
  • Servers located across the globe
  • No IT involvement needed
  • Automatic updates to the newest features
  • Regular backups
  • Quantify Web included with each subscription
  • From $349/month!

PAY-AS-YOU-GO

If you are on a budget or have a temporary need for design software, you can purchase a Pay-As-You-Go license. Pay-As-You-Go also has a minimal startup cost and a small monthly fee. Pay-As-You-Go is installed on your desktop, laptop, or tablet, and is easily activated and de-activated.

Scaffold Designer for Cup, Ring, and Kwikstage: $249

Scaffold Designer Kwikstage-only: $149

Handset Designer for Symons-style forms: $149

GETTING STARTED

As with our on-premises offering, full implementation, data conversion, and customized training is included in your purchase of Quantify Cloud and Pay-As-You-Go products.

ONGOING SUPPORT

Cloud and Pay-As-You-Go customers receive the same highly-responsive and professional support as our on-premises customers.

UPDATES

Software updates are automatic and require no IT assistance. The cost of all updates is included in the subscription fee. Whenever our software is updated, web-based training specific to new features is provided at no additional cost for subscribers worldwide. View the training schedule.

Contact us for a Free Demo

By: Michelle Caskey

Quantify is Now in the Windows Store

Quantify is Now in the Windows Store

Originally posted on Thursday, May 9, 2013

If you’re thinking about upgrading to Windows 8, we want you to know that Quantify has been accepted into the Windows Store. In order for an application to be accepted into the Windows Store, Microsoft must first rigorously test it, to ensure compliance with Windows 8.

We’re pleased to be the first and only software application in the scaffolding industry that meets their stringent requirements.

Quantify is Now in the Windows Store

By: Brian Webb

 

 

Latest Quantify Product Guide Available

Originally posted on Saturday, June 18, 2011

 

The latest Quantify product guide is available online. The guide provides an overview of features, as well as details on specific Quantify functions. Find out all the ways Quantify can make your business life easier.

 

www.avontus.com/products/quantify/pdf/productguide.pdf  (3.5 MB)

By: Brian Webb