Those costs are compounded when inefficiencies – downtime waiting for parts to arrive, disorganized inventory or overlooked routine maintenance resulting in equipment breakdown – are allowed into the system. If you don’t invest to keep things running smoothly today, the debt will come due tomorrow and will most likely cost more than it would have otherwise.
Alfred McFadden, operations manager of the maintenance division at Pleasant Valley Farms of Berkshire LLC in Richford, Vermont, shared his strategies for keeping shop operations running smoothly during the 2019 Operations Managers Conference, presented by Cornell’s Pro-Dairy and the Northeast Dairy Producers Association. McFadden, a former parts manager for major car dealerships, now handles purchasing, shipping, receiving and inventory, along with recordkeeping, for the farm’s maintenance division.
The maintenance division at Pleasant Valley Farms consists of a dozen workers, including the mechanics servicing the large multibay shop and a full-time machinist in the steel shop, where parts and equipment are fabricated or welding repairs are performed. Aside from the on-farm equipment, the multilocation operation also has a methane digester, a fleet of fuel trucks and other on-road vehicles serviced through the maintenance division.
Establishing a system to manage the workload efficiently is the first step to cutting inefficiencies and ultimately saving money for the farm. McFadden first eliminated dealing with parts and equipment salesmen, opting to deal directly with parts stores within a 100-mile radius of the farm. This allows him to shop around for the best price and to select off-brand parts for savings when possible.
“Go right to the source,” he said. “You need a person to do this who isn’t the maintenance guy. Create another position,” if needed to handle the ordering, shipping and receiving. He negotiates directly with the shops and forces them to compete on price. Even different branches of the same chain store will often offer different pricing. Early ordering each spring, when he stocks up on commonly needed items, comes with a 10 percent discount, McFadden said. With many parts stores, “the more you buy, the more you get back,” so taking advantage of loyalty programs and discounts can add up.
Picking up parts can save on freight costs, but only if a designated person (and not the shop mechanic) is making quick and efficient runs to the store, or if trucks already on the road can make the pickups. When having items shipped, orders placed after 3 p.m. carry additional charges to expedite immediate shipping, so don’t procrastinate when placing orders for the day.
It’s also important to remember that, depending on the brand, parts aren’t always interchangeable. Knowing whether a specific part will fit all of your tractors or not is best done before you need to replace a part and find you have the wrong part in stock.
“Sometimes purchasing the part isn’t necessarily the best option,” McFadden said, and getting it repaired can be worth it.
Most importantly, McFadden is the only person authorized to order and purchase parts. This enables him to develop a direct relationship with the parts stores, capitalize on rebate programs and manage the parts inventory seamlessly. In his first year, the money he saved the farm was equivalent to his salary.
Managing the inventory, ordering, shipping and receiving starts with putting a system in place, McFadden said. A protocol for every step, led by one person, keeps things organized and accountable.
Providing the wrong information when ordering a part or receiving the wrong part from the store causes holdups and often is the result of disorganization and lack of accountability. Invoices are often inaccurate, and having one point person to do the ordering, check the shipments and reconcile the invoices can help catch any mistakes and keep things running smoothly.
Inventory should be stored accessibly and kept stocked with the correct parts for your equipment. Inventory control means there is a system in place that accounts for anything leaving the storeroom or entering it. At Pleasant Valley Farms, a three-story building was designed specifically for inventory. When the equipment breaks, you need the part now, not in a day or more, so having enough parts on hand to get you through the season is recommended. Reordering commonly used parts prior to your stock being depleted is also imperative.
“Keep the parts in stock that you need. Your downtime is when you’re waiting for your parts,” McFadden said.
The value of the crops decreases if you can’t get to them due to broken equipment. Part of keeping equipment in operating condition is having any on-road vehicles inspected. Pleasant Valley Farms has established its own state-approved inspection station. Despite the equipment and training needed to operate a Vermont state inspection station, which includes audits and inspector visits, it saves money to do it themselves, saving time and therefore money with their large fleet of trucks, McFadden said.
All of the farm equipment cycles through the shop on a monthly basis to provide maintenance and prevent breakdowns. Every piece of equipment on the farm has its own file, and written documentation is kept on all routine service as well as repairs. The file identifies the appropriate parts for easy reference. Each shop technician has his or her own toolbox, so they have all they need right at their fingertips, saving time, keeping employees accountable and decreasing stress levels.
Technicians each have clipboards, where they list the parts they’ve used that day. This helps with inventory control and ordering. They have designated personnel to work on the methane digester, the portable motors, the service trucks and the tractors, plus a few “floaters” to fill in where needed.
“The shop is in pretty good shape most times,” McFadden said, despite all of the activity it sees on a daily basis.
Equipment is pulled into the shop during extremely cold weather so it will start the next day, avoiding downtime. In an effort to save fuel costs, the farm purchased a local fuel company, and they now own tanks and trucks to provide heating oil, as well as fuel oil. Fuel trucks can go out to the equipment in the fields, avoiding downtime when the equipment has to come in for refueling.
With everything going on in such a large operation, the tendency toward chaos has to be curbed through organization and protocols, keeping things running smoothly and eliminating costly oversights. McFadden said they’ll be making additional improvements in the efficiency of the maintenance division by hiring a service manager. This person will delegate tasks, oversee and assist with procedures and organize scheduling.
“Without us, the girls don’t get fed. They don’t get milked,” McFadden said. “We don’t make the money for it. We save the money for it.” And without these savings, “the farm economics don’t work.”
PHOTO: Inventory control means there is a system in place that accounts for anything leaving the storeroom or entering it. Organization to those parts is key. Photo by Lynn Jaynes.
Tamara Scully, a freelance writer based in northwestern New Jersey, specializes in agricultural and food systems topics.