Former Tool Owner Now Rents

W hen finishing superintendent Johnny Estes joined Phoenix-based Pete King Construction Company 15 years ago, the interior construction contractor was devoting a staggering 160 labor hours each week to maintain their drywall taping and finishing tools.




Moreover, each of the company’s 10 to 15 crews spent a significant amount of time repairing tools in the field—what Estes terms “making tools work on-the-tailgate.” Meanwhile, the company also retained a full-time technician to manage routine tool cleaning and maintenance. Estes, a former finisher, eventually reversed this practice and boosted production times, as well as King’s bottom line.




“We make money two ways: more efficient tradesmen and less overhead,” explains Estes. “It took us time to appreciate the fact that tools—whether we own or rent them—are only profitable when they are operating at 100-percent efficiency.”





Like most contractors, the 70-year-old framing, drywall and painting company began this discovery process by investigating its total tool investment.





In addition to pulling contractors away from active production, maintaining tools required thousands of parts to keep the estimated 200 to 300 tools operating properly. The typical automatic taping and finishing tool set contains more than two dozen wear-parts that must be replaced during the normal course of operation. Additional parts are needed to replace broken or damaged tools. All of which is why tool parts and components represented a considerable annual expense at that time, according to Estes.





The heavy investments in jobsite labor and replacement parts helped the family-run company book a significant amount of backlogged commercial projects—a considerable accomplishment in this still-recovering market. However, at more than 8,000 man-hours annually, King management couldn’t help but wonder whether there was another way to reduce, if not eliminate, the significant level of tool maintenance costs.





“We’re not a tool company, nor did it play to our strengths,” Estes admits. “Once we started using job-ready tools, we finished jobs more quickly, improved our finish quality and boosted profitability. The production value isn’t on the tailgate, it’s in the construction.”
Renting Raises Contractors’ Productivity
Over the course of its seven decades, the company experimented with a variety of tool rental and tool purchasing arrangements—even once hiring a machinist to design their own tool prototype. In the end, King management was left believing that renting would be more costly.










“Just like purchasing a car, tool ownership is often perceived as the more economical option. But in fact, tools only depreciate in value. At AMES, we tell everyone that the value of tool ownership hinges on proper tool maintenance. Just as you would drive a car slower with defective brakes, contractors must compensate for poorly performing or broken tools by working longer or overstaffing jobs.
In addition to the many consumable or wear-parts that require replacement, job-site hazards can also compromise tool performance. Occasionally, tools are crushed in the jobsite box, knocked over while leaning against a wall, or damaged when quickly thrown in the back of a truck at the end of the day. Proper alignment and calibration is critical on corner finisher blades and automatic taper advance and cutting actions.





A defective tool is not only a drag on the bottom line, Wilson argues, but also a liability that inevitably results in decreased productivity, substandard quality, time-consuming repetitions or jobsite injuries.






Productivity Is King


At Pete King Construction, the issue over the true cost of tool ownership came into focus as Estes was rushing to replace a $390 corner finisher. Asked by his tool sales rep why he didn’t rent the tool and outsource the maintenance, Estes began trying to rationalize the company’s 30-year decision to purchase tools by analyzing his actual spending.





As part of his investigation, Estes asked his crews to rate tool performance, finish quality and any operational difficulties. While some brands were likened to “Volkswagens” and some to “Cadillacs,” roughly eight in 10 contractors cited a preference for tools that were easier to control, finished cleaner and eliminated the need for touch-ups. Overall, contractors appreciated the ability to minimize downtime by immediately changing out a defective or broken tool with a clean, fully calibrated replacement.





Reviewing the worker comments and the cost data—from tool purchase to repair parts, contractor downtime and the time it takes to compensate for broken or inaccurate tools—Estes found the expense of tool ownership far outweighed the return on this investment. So, in 2010, Estes sold back the bulk of the company’s taping tools through his local AMES store, and began renting tools based on the particular requirements of each job—adding and returning tools according to need.





For example, Estes anticipated doubling the company’s tool inventory last summer to accommodate an expected increase in school-related construction projects. In addition to providing flexibility to support a large project, tools can be easily tracked by project or by individual contractor.





Today, at Pete King, contractors verify tool serial numbers when they receive their weekly time cards. Periodic “tool audits” conducted by Estes and his local tool rep reinforce this tracking process. Capturing all the costs associated with a particular project also helps the company accurately monitor costs.
Do It Right the First Time
Beyond expense reductions through better tracking, Estes challenged his staff to work smarter with factory-fresh tools.





“With our rental agreement, I don’t allow my guys to use a broken, dirty or substandard tool. They start every job with a fresh new tool,” explains Estes, who equates the top-performing equipment to a quality control system in which standardized tools yield uniform results. “Instead of working harder to compensate for a tool operating at 75 percent capacity, we want that same finisher to finish 20 percent more board feet each day. This way, the same number of people can complete more jobs.”





In the event that a contractor can’t immediately bring a tool back to the store, Estes keeps a complete set of spare tools in the company’s warehouse. This way if a tool breaks, it can easily be swapped out with a fully-calibrated replacement—allowing contractors to focus exclusively on finishing tasks.





Pete King Construction Company has been so impressed with their ability to maximize worker productivity through tool rental that they’ll never go back to owning and maintaining tools.





“For us, the misconception was assigning finishing contractors the role of service technicians,” concludes Estes. “When we freed up contractor’s time so they could spend more time actively finishing, we finished more jobs in less time and with less staff. In the end, we found that smart money is ‘on-the-wall’ not in the tool.”






Mark Wilson, a 15-year company veteran, serves as director of education for Ames Taping Tools and is based at the company’s Stone Mountain, Ga., headquarters. Wilson brings more than three decades of industry expertise, including roles as a professional finishing contractor and product specialist, and he has held a variety of sales and regional management positions as well. Email him at [email protected].

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