Lift Truck Maintenance: Satisfying your Customer Checklist

The growing popularity of leased lift trucks has created a parallel increase in outsourced fleet management programs. Whether provided by the lift truck dealer or a third party, the maintenance, repair and operations (MRO) services come in a range of options from basic, planned maintenance (with all other MRO activities handled in-house) to complete maintenance (oil changes to engine replacements).

Because lift trucks play a vital role in the warehouse or DC, leasing them means also considering overall equipment utilization, total cost of ownership over the complete lease term, and other financial and customer service-related issues.

“The customer-driven trend toward more leasing is the result of operations realizing that purchasing equipment results in fleets being kept beyond their economic life,” says Bill Buckhout, director of leasing and remarketing at Yale Materials Handling Corp.

On older trucks, for example, the cost curve increases quickly and results in substantially higher costs for owned fleets. Similarly, companies have discovered that they are not specialists in equipment repair and maintenance, and that maintaining a fleet on your own is typically much more expensive than one maintained by a dealer.

“Many factors impact how parts are treated in a maintenance agreement,” Buckhout says. “Companies should negotiate the best maintenance agreement possible—one that includes uptime guarantees.”

Figuring out the total cost
Break the cost of owning a forklift down over a five- to seven-year period and you’ll come up with two significant cash outlays: the truck itself and the battery (for electric vehicles typically used in warehouses).

Once those two costs are amortized over the length of the lease, then battery charging and maintenance are the two ongoing expenses. If all of your vehicles are not up and running due to poor maintenance, then issues like lower productivity—or the need to run out and rent a forklift for the month at an additional expense come into play.

“From the operational expense point of view, the maintenance side is the single largest expense around operating your fleet, by far,” says Neil O’Connell, senior vice president of technology, innovation and product development at TotalTrax. “It’s definitely worth paying attention to.”

Dealer vs. third party
Just how dealers meet their maintenance agreements can vary, but in most cases they’ll either stock parts at their facilities or have a way to order them for quick delivery. “If a dealer cannot repair a unit in 24 hours with on-site parts or those shipped from a warehouse, typically they will offer a free rental unit until the customer’s unit is ready for operation,” Buckhout explains. “Ask dealers what their ‘first visit completion rates’ are and require them to keep and report data on their performance with your fleet.”

Other key questions to ask yourself when selecting a disciplined maintenance approach for leased vehicles include: Do we require 24/7/365 service coverage? Do we need an on-site technician? What do we want to cover in our agreement—tires, seats or accidental damage? Will the contract be paired with a new equipment lease? What are our billing requirements? How much do we actually use the equipment? “For both lease and maintenance, rates are based on use,” says Buckhout. “Buying too many or too few hours costs operations more.”

Jim Gaskell, director of global technology business development at Crown Equipment, says service quality should also come into play, and that it starts with the very first service call. “How good is the quality of the call, was it recorded, and how was it disseminated or distributed to the service technician? These are all questions you’ll want to ask right out of the gate,” says Gaskell. Urgent repairs, for example, should be handled immediately (based on the agreement between the company and the provider).

During those service calls, be ready to get as detailed as possible, says Gaskell. Instructions like, “We have a Hi Lo down on dock four that needs repair” aren’t enough to get the job done quickly and efficiently. “With those light details, the provider will have to send out a technician just to find out where the truck is, what model it is, and who the operator is,” says Gaskell. “That can be a big time waster when you’re trying to get your equipment back up and running quickly.”

Consistency of contact
Knowing that lift trucks will require ongoing maintenance and occasional repairs, Gaskell says it’s a good idea to put someone in charge of them in the warehouse or DC. “Don’t just take a random approach to this,” he cautions. “If the truck needs to be serviced, there should be one representative from your company who actually makes the call for service and interfaces with the service channel, versus having just anyone call in from the store level. That consistency of contact is important.”

This consistency also helps establish a relationship between the company and the service provider—something that can prove valuable when last minute calls or unexpected repair needs surface. “It doesn’t have to be complicated,” Gaskell points out, “but you do need someone who can be accountable for the process on your end.”

In return, Gaskell says companies get equipment that lasts longer and that costs “far less” to own and operate over the term of the lease. “A non-managed program will cost you a fortune, but a managed program will save you money,” he says. “More importantly, you’ll have the equipment operational and ready to use when you need it.”

Working side by side
When assessing the ongoing MRO needs of the typical lift truck, John Rosenberger, a product/program manager at The Raymond Corp., says lessees should factor in scheduled maintenance (every 500 hours) and also any extreme circumstances (i.e., usage in a freezer or other harsh conditions). Also look at the total amount of use and abuse that the vehicle has endured over the same period, says Rosenberger, as well as its age and total MRO costs. If, for example, you’re trying to get one more year out of a 7-year-old vehicle—but paying $10,000 a year on repairs and maintenance—then it’s probably time to lease a new lift truck.

And don’t be afraid to ask your lift truck and/or maintenance providers for advice on usage and future equipment leases, particularly to improve fleet mix and ensure you’re using the proper equipment for the right application.

“Many times we see firms using four or five reach trucks as glorified pallet trucks, but with the right amount of data and telematics, we can help them improve ROI and warehouse efficiency by leasing them four pallet trucks instead,” Rosenberger explains, noting that the latter can pick up three pallets at once and deliver the goods down the dock more efficiently than a reach truck can. “We’re helping customers get more velocity through the warehouse and save money at the same time.”

Finding the right partners
When leasing lift trucks, O’Connell says companies should source from more than one vendor. “I rarely see companies that use only one,” he says, “and in most cases they have four to six different vendors.” This varied approach can create complications in the MRO area, O’Connell notes, and often prompts companies to work with third-party leasing companies that sell and service multiple brands and models. “This is a big part of the decision criteria that companies have to think through,” says O’Connell.

He adds that companies should also seek out vendors and/or third-party service providers that provide relationship-based services rather than just replying to one-off service calls and then disappearing until the next routine maintenance visit or service call comes up. “There was a time when forklift vendors were focused on selling or leasing more trucks,” O’Connell explains, “but now they’re taking on trusted advisor roles, helping customers cut down on the number of trucks they’re using, and providing better maintenance on those vehicles.”

Buckhout recommends checking references from service providers to validate their capability to meet your needs. Pick a comprehensive service, leasing and equipment provider so that everything can work seamlessly together. “Schedule biannual meetings with your service provider to review actual use against use allowed in the lease agreement,” says Buckhout. “Evaluate the service provider’s uptime performance and address any issues with the equipment, service or lease. If equipment is properly maintained and is used based on the provisions in the lease, there should be no issues or added costs at the end of the lease term.”

Finally, it’s also a good idea to visit reference sites to review what customers have experienced with the provider (online review sites like Yelp and Google Reviews are both good starting points for this type of research). “Picking the right service provider is critical to successful outsourcing,” says Buckhout. “If you do your homework, you can find the right one for your needs.”

Companies mentioned in this article:

• Crown Equipment
• The Raymond Corp.
• TotalTrax
• Yale Materials Handling Corp.