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Blog March 2022

7 Ways an Automated Dispatch solution can boost the profitability of your scrap recycling business

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Conor Dowd Product Marketing Manager

The cost of collecting scrap from suppliers can represent up to 20% of the landed cost of scrap purchases and this percentage is increasing with recent increases in fuel and driver costs. For a scrap metal recycling business, it is therefore critical to ensure that it can manage both it’s fleet and container assets at maximum efficiency to reduce costs and boost profitability.

However, many scrap companies struggle to gain visibility and control over the transport operations as they are ill equipped with either manual dispatch systems or those which are not integrated into their overall enterprise management systems.

A modern automated dispatch solution will support the following key functions:

Using a  modern automated dispatch solution that is fully integrated with your enterprise management system will boost your profitability in the following ways.

1. Automate the key dispatch functions to increase productivity by 40% 

 A modern dispatch solution will automate planning to the highest extent saving planning time and ensuring that plans are cost efficient, realistic and deliver high levels of service accuracy. A dispatch solution should have digital maps, visual tools to support load balancing and timeline projections with a built-in road network with a distance calculator to deliver fast and accurate plans. A dispatcher should have full visibility on the available trucks, drivers, and containers so they can set the collection plan up for success. These tools will free up your dispatch staff to ensure that they can focus on high value tasks rather than repetitive manual planning tasks that are prone to errors. Planning time can be reduced by 40% using this level of automation. 

2. Take your dispatch automation to the next level with Intelligent Optimization 

The most advanced dispatch solutions have access to intelligent optimization algorithms which offer even higher levels of automation to support automated productions of schedules and then modify them as the day progresses.

An intelligent optimization system will look at the live roll-off orders and automatically build the most efficient schedule taking into consideration the most optimal sequence of container services (lifts, drops and exchanges etc.) as well as planning constraints such as customer access times, driver preference rules etc. 

This level of optimization increases your agility and responsiveness to daily unplanned events like truck breakdown, priority orders, traffic congestions etc.

Optimization algorithms are faster and more accurate than human planning capabilities and can deliver savings in the order of 15% per annum in terms of transport costs. 

3. Understand your transport costs to protect margin

It will allow you to track both the internal and external costs of collections to arrive at a transport cost per ton for each load. Your solution should be able to record the transport cost by zone, truck, container and service type. Where you are using third party haulers, your dispatcher needs easy access to up to date freight costs to ensure the correct choice of carrier.  The total landed cost is an important metric, given that scrap recyclers collect material on a Free on Board (FoB) basis where the seller is not charged a separate line item for transport. Unless you track your landed cost per ton, your margin will be hit by factors such underweight containers. Better still your pricing engine should be able to automatically adjust your purchase price when container weights fall below expected weight thresholds.

4. Manage your container inventory to increase their utilization by 30%

Roll-off containers start at $3000 cost per annum and many scrap recyclers have thousands of units but poor visibility on their location and utilization. A modern dispatch system needs a functioning container inventory system so that you always know where your containers are.  Containers can be tracked by assigning an individual identity by using a simple barcode feature or a more advanced IoT tracking solution.  Having access to real-time container inventory means that dispatch will know what capacity is available to sell and it can create on average up to 30% additional service capacity from existing container inventory. It can also minimise container leakage and help to identify and recover container theft. Furthermore, it will allow you to address slow moving containers pro-actively and an automated pricing engine can apply rental charges where appropriate.

5. Gain insights into your driver behavior to reduce transport costs by up to 14%

A modern dispatch solution will integrate with on board vehicle systems such as telematics, driver in-cab mobiles and onboard scale systems. Telematics data can provide you with rich insights into both driving behaviours such as idle time, harsh driving, unauthorised breaks and off prescribed route driving to allow you to reduce both your fuel and driving costs.  Telematics solutions are proven to reduce fuel costs by up to 14%. A real time link to a driver in cab mobile will allow the dispatcher and driver to interact in an efficient manner and for the driver to record important cost impacts such as delays on customer sites.

6. Connect your dispatch function with every part of your business

Dispatch is an integral part of any scrap recycling business as it can manage both incoming and outgoing loads from your yards as well as the yards of your customers and suppliers.  It therefore needs to be integrated with each key scrap recycling function such as the scales, purchasing, finance, sales, brokerage and operations.  This approach will increase your operational efficiency across your operations and reduce administration costs. 

7. Align communication and collaboration between dispatch, drivers, suppliers and customers

An automated dispatch solution is designed to keep all stakeholders informed in real-time of all events and support live tracking of truck activity to ensure accurate communication with customers (e.g., ETA notices). Innovations such as a modern browser interface that allows access on any device , driver mobile apps and a range of self-serve portals allow the sharing of information and orders. This reduces the cost and incidence of calls, emails, administration, and miscommunication

The AMCS Transport Management System is the most advanced automated dispatch system designed for the specific challenges of the scrap metal recycling industry and it forms an integral part of the AMCS Platform for Metal.

The AMCS Platform for Metal is an enterprise-grade cloud software platform designed to automate and optimize all the processes of a scrap recycling company including, dispatch purchases, compliance, scales, grading production, inventory management, sales, brokerage and outbound logistics. 

To learn more about the AMCS Platform for Metal, please click here

Please come and visit us at Booth #901 at the 2022 ISRI conference in Vegas on the 21st-24th of March – book an appointment with us here.

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