Truckast – Logistics and Commerce for Concrete

This is my interview with Kurt Kratchman, CEO of TRUCKAST, Inc.

Can you tell a little bit about your company’s background?

We are a team of veteran software developers and entrepreneurs passionate about construction, logistics, economic development, collaboration and productivity tools and technology innovation. When cloud, mobile and other open source software tools came together, we realized we could develop cost effective solutions for complex logistics problems.

We are also business analysts and we understand that transporting low-cost commodities with an eye toward saving money requires seamless communication and information sharing among suppliers, intermediaries, carriers, and consignees. Any breakdown in this interchange can result in compromised service performance and reliability, not to mention increased transportation and logistics costs.

What is Truckast, in a few words?

truckast-mobile-orderTruckast is logistics and commerce for concrete. We are a leading provider of mobile and cloud software solutions for building construction materials logistics and field service operations. Truckast offers logistics software, collaboration and order management tools to help increase profits and reduce costs for ready mix concrete contractors and suppliers. The platform allows concrete construction materials customers to plan, track and order their jobs on any mobile device. One master view, shared by both contractors and suppliers, providing transparency and trust through the use of mobile collaboration technologies. The app is accurate, secure and user friendly; the user interface is efficient, easy to learn, and satisfying to use.

The nation’s leading technical, infrastructure and commercial builders are using Truckast. Since we launched the app and platform in 2014, over 3.3% of concrete pours by volume (13.1 million cubic yards of ready mixed concrete) were planned, ordered and tracked using the Truckast software. Adoption, volumes and usage continue to increase as the industry realizes the tangible value that Truckast creates. Our website www.truckast.com shows real time data on concrete being poured through our system today, over the last 90 days and since we launched.

What are the origins of Truckast and what is the problem that it solves?

Construction is not immune from innovative technologies that have been disrupting all industries. Significant disruptions to the construction industry include: Increased collaboration (making an opaque industry more transparent and substantially more efficient) and ever-more sophisticated design software and visualization.

We began by investigating how we could use technology to help the construction industry. We observed that the relationships between suppliers and contractors, in general, were not as collaborative or transparent as they could be. We set out to change this by using technology to help contractors and suppliers build better relationships with each other, improve efficiency, and provide enhanced services. Because ready mix concrete is a perishable product used in all types of construction, this seemed like a good place to focus our attention.

Truckast-track-mobileTruckast is sophisticated software for visualization and collaboration. We take all the relevant data that is available from the supplier and make it available to both sides, the contractor and the supplier. This is a classic two sided platform using supplier data from their ERP systems, ordering, dispatch, a variety of sensors and gps, and we move it up to the cloud and present it on any PC or mobile device. This real time data allows contractors to save time not having to call dispatch or sales, they are more efficient because they have access to the data at any time, and this allows them to better utilize their resources, saving the developer money. Supplier’s on the platform demonstrate innovation, transparency and improved customer service and retention. Truckast changes the conversation and strengthens the relationship. We hope the entire industry will adopt this idea.

It’s always best to hear it directly from the end users (more customer quotes at http://www.truckast.com/faqs/):

“When I’m doing my cost reporting, I can easily check how much concrete was delivered to a specific job site. Before the TRUCKAST app, I would often have to track down the final quantity of concrete delivered from my accounting department. Not only does TRUCKAST help me manage the day-to-day concrete delivers at job sites, it has also sped up my cost reporting workflow.”

– Tim Brogan, Sr. Project Manager, Shiel Sexton

“[Before TRUCKAST] we never knew where those trucks were or when they’d get there. If they got 5-10 minutes late, we’d have to call dispatch, or we’d call our sales person and they’d call the plant or dispatch to check on our concrete. The issue is knowing where you’re at on yardage. It’s critical that we don’t have four extra trucks sitting there and you can’t use their concrete. That’s thousands of dollars extra.”

– Casey Harvey of Custom Concrete

Who should use it how will it change their day-to-day operations?

We have laid the groundwork for improved communication and collaboration between contractors and suppliers. Streamlining supply chain processes is a critical differentiator among companies looking to retain existing contracts and compete for new ones. We see the entire construction industry headed in this direction.

The project team, sales and operations, and back office all benefit in unique ways. I’ll list out each contractor role for you here so you can see how day-to-day operations are improved.

If you are a …

  • Project Engineer: Monitor change orders from concrete subcontractors, verify correct materials are being used prior to each pour, and compare theoretical progress with actual progress (budgeting).
  • Project Superintendent: Track QC test results from each pour, monitoring activity of subcontractors, ready mix providers, material providers, verify correct materials are going to be delivered at the right time, monitor on site crews as they perform work in real time and benchmark contractors, suppliers and material providers.
  • Project Manager: Research past jobs for timing of pours and materials delivery history and retain detailed audit logs to assist in resolving and reducing disputes.
  • Estimator: Compare theoretical performance with actual to refine estimation, track quantity of materials, and validate labor requirements based on past and current orders in progress.
  • Logistics Specialist: Monitor the delivery of equipment and materials from a single app and track on-time or late deliveries with log history to determine cause for delays.
  • Safety Specialist: Post safety specific messages in each order and post info about safety incidents on-site which are logged and archived.
  • Accounting & Accounts Payable: Verify subcontractor material usage and invoices, validate project milestones, monitor schedule of projects for cost tracking purposes, forecast earnings and profitability using real data.
  • Procurement Specialist: Benchmark materials suppliers by monitoring their performance on site.
  • Operational Specialist: Monitor orders placed and delivery schedules past and current.
  • Small Contractor: Delivery and order transparency, personalized attention for the “little guy,” and increased knowledge of supplier product offerings.

What do you need to have and do to get Truckast into use, and what are the costs?

From a technical perspective, the time it takes Truckast to be up and running typically is half a day (approximately 4 hours).  Pricing for ready mix suppliers is based on several factors, including number of plants, annual CY poured, databases, number of contractor customers and types of projects, integration points, remote access capability, and custom data fields. We use this information to calculate data transfer rates, data storage, data processing, and state of readiness. We can typically estimate this over the phone.

If you are contractor, you can be set up in minutes as long as your supplier in on the platform. The cost for a contractor is $240 per year, per user (single user license fee) with unlimited use. We will offer month-to-month plans. If the contractor wants a supplier on the platform, then they should call their supplier and request the Truckast service. The supplier should be happy to learn about an industry innovation that helps them add value to their customers. You can also send us an email with your supplier’s contact info and we will contact them to discuss how to fast track their set up.

Where is Truckast available?

In North America, we have contractors and suppliers on the platform in California, Florida, Illinois, Indiana, Kentucky, North Carolina, Ohio, Michigan, South Carolina, Tennessee, and Toronto, Canada. We plan to be in every state and every country! 

What tangible benefits have the customers already received?

What is the value of Truckast to the end user? How can we quantify it? In a conservative industry where the promises of technology have failed to deliver, the value of a new product or service needs to be clear. The two areas we feel are most relevant and defensible is time spent ordering concrete form dispatch (transaction costs) and time spent on project administration. Truckast has measured a significant Return on Investment (ROI) with its product by first measuring the efficiency and time savings.

To get our time savings data, we conducted a survey of construction personnel asking how much time using Truckast saved them personally, instead of calling dispatch. On average they said that they saved 2.5 hours per person every week. This is pretty amazing when you consider that 2.5 hours is more than 6% of a regular fulltime work week. Multiplying these time savings by salary data resulted in a net savings of $6,250 per year per user.

Annual Time Savings: $6,250 per person / year

Project administration is one of the hardest things to measure, yet its huge impact makes it something that can’t be ignored. On large projects, rework is a constant and expensive problem. It is common for project managers to change orders due to interdependencies on the subs, suppliers, logistics, weather, resources. Making sure the invoices are verified and match the orders is a cumbersome and time consuming process. The cost of calling sales reps and dispatch, verifying orders, checking invoices from past orders, submitting change orders outside of regular business hours are all part of the project managers responsibilities. Before Truckast there was no way to do any of this without calling and meeting with suppliers and accounting, leaving voicemails, chasing down people, sending emails and waiting. Truckast’s automatic syncing, distribution, and access to accurate and archived data eliminate this problem, resulting in large savings.

“This was the largest unknown that I gain from using Truckast. It allows me to do this type of administrative work at any time, not in business hours. This has tremendous value for me because I can focus on the big issues during the day. I don’t have to waste time calling dispatch or the sales rep or my own internal accounting staff. So this saves other people time and money too, additional resources at our company and at the supplier.”

– Project Manager 

To get our Project Administration data, we conducted a survey of Construction and Supplier personnel asking how much time using Truckast, instead of calling their sales reps and accounting, saved them personally. On average they said that they saved an additional 2.5 hours per person every week. 2.5 hours is more than 6% of a regular fulltime work week. Multiplying these time savings by salary data resulted in a net savings of an additional $6,250 per year per user.

[alert alert_type=”info” ]Project Administration Annual Savings: $6,250 per person / year [/alert]

Adding up time and project administration together results in annual savings of $12,500 per year. The total project cost for Truckast per user is $240 per year. This leads to an ROI of 5108% or 50x.

$12,500 – $240 = $12,260 (Annual Savings – Truckast Cost)

ROI: ($12,500 – $240) / $240 = 5108% or 50x

ROI 5108%

Assuming an hourly rate of $50/hour, less than 5 hours using the app pays for the annual use of the app.

Another way to think about from the contractor’s side is the “rule of 10s”:

  • 10 yards of concrete costs $1,000
  • Installed cost in the structure is $10,000
  • Ripping out and replacing that load is $100,000

So preventing one bad load of concrete from getting into the structure is worth real money.

What plans do you have for the future?

TRUCKAST is a proof point for the larger construction software industry. We are planning to move our construction software into other perishables like asphalt and cement. And we think there is a lot of room to improve logistics and ecommerce capabilities with other building material suppliers and contractors. We see opportunities for construction industry to develop their own apps and innovation technologies on top of our platform. We will open our platform to other developers. I’ll close on this anecdote: a couple of weeks ago one of our customers wanted to see some data from another company that provides quality control data from sensors during a pour. In a very short time we successfully brought into Truckast the 3rd party data that our customer wanted to see. In the eyes of the supplier and contractor, the value of the Truckast platform became exponential.