Construction Logistics Strategy saving cost and reducing environmental impact

WRAP is a Client of The Logistics Business - Material Logistics Plans

A year ago we reported on how WRAP (the Waste & Resources Action Programme) was promoting good practice in construction logistics as a way of minimising waste and reducing carbon emissions. The leading supply chain and logistics consultancy company, THE LOGISTICS BUSINESS, has undertaken a number of projects on behalf of WRAP to evaluate the effects of applying good logistics practice to construction projects. These include the use of Material Logistics Plans (MLP) and the application of logistics strategies such as Construction Consolidation Centres (CCCs); Just In Time (JIT) delivery of materials; IT tools for delivery management and materials control; on-site logistics specialists and off-site manufacture. The findings of this work illustrate the powerful and positive impact logistics has on the construction process, and in particular the benefits of developing Material Logistics Plans for construction projects. The findings have been included in a range of Case Studies soon to be available on WRAP’s Website, and the Website also includes guidance on using MLPs. The following are just a few examples of what these case studies show:

Central St Giles is a mixed development in central London providing 400,000 sqft of office space, 56 apartments, 53 affordable homes and 26,000 sqft of restaurants and retail units at ground level. Central to the logistics strategy was the use of a Construction Consolidation Centre. This was operated by logistics contractor Wilson James, who managed the transport between the CCC and the site, and also the on-site logistics- including other site services such as security.

Contractors instruct their suppliers to deliver to the consolidation centre rather than directly to site. This mainly concerns materials in the fit-out stage, while large loads such as steelwork and heavy plant are still delivered directly. On arrival at the CCC, responsibility for the movement of the materials to the workplace is taken over by Wilson James.

The contractors on site order materials from the controller at the CCC two days in advance.  The controller then consolidates loads, which leads to far fewer vehicles arriving at the site compared with normal direct deliveries. These regular deliveries mean only minimum quantities of materials need to be held on the site, reducing the risk of damage, obstructions and H&S incidents caused by congestion.

Some notable achievements on the project are:

  • There was a reduction in vehicle journeys to the site (and corresponding reduction in CO2) of 75% compared with if consolidation had not been used.
  • A delivery accuracy averaging over 97% was recorded – measured as vehicles arriving within +15 minutes of required time and with the correct load – thereby avoiding congestion and waiting time. Studies have shown that typically only 40% of deliveries in the industry arrive within +30 minutes of the scheduled slot.
  • During the six month study period, plasterboard waste was running at just 6.4%.  This compares extremely favourably with the industry average of 22.5% waste, and significantly exceeds the 15% target set in the Contractors and Developers Voluntary Agreement in 2008.

Barts and The London Hospital are two hospitals redeveloped under one of the largest Public Private Partnerships in Europe, with a construction value of more than £1 billion.  The main contractor Skanska was one of the companies engaged with WRAP when WRAP’s MLP guidance document was first drawn up. Barts was a pilot project in this process. Located in the centre of London, it uses a CCC and on-site logistics specialists. The London hospital is the larger of the two projects, but as the site is less constrained a CCC is not used and contractors are responsible for their own material handling on site.

The logistics operation at Barts is similar to that at Central St Giles, and we can see similar positive impacts resulting from use of the CCC:

  • There were 2,229 fewer delivery vehicle journeys into central London between March 2008 and July 2009 (the study period) as a result of consolidation – a 74% reduction (and a corresponding reduction in carbon emissions) amounting to 18 tonnes. Overall cost savings as a result of reduced congestion charges and other factors were significant.
  • A vehicle delivery accuracy of between 95% and 100% was consistently recorded – measured as arriving within +15 minutes of the scheduled slot – and helping to avoid congestion and waiting time.
  • Skanska was able to work with one of its major suppliers to develop the use of a re-usable pallet box to handle electrical items. This improved product protection, made handling easier and significantly reduced packaging waste.

A visit to the two sites gave an immediate impression of the impact the different logistics strategies had. Barts was an extremely tidy site with no large stockpiles of materials, just small consolidated holding areas at the points of use by each contractor. There were no vehicles queuing at the gates. Conversely, at The London Hospital congestion was frequent, with multiple vehicles arriving simultaneously and the various contractors handling their own material, often leading to queues at lifts as well as the regular double handling. At The London Hospital site there was more stored material and more waste in evidence – the housekeeping was not at the same level as at Barts. In comparing the two sites, it must be noted that The London Hospital was a much larger site and that in fact on overall waste performance, both sites diverted 95% from landfill. However, looking at one material – plasterboard – the wastage rate at Barts was about half that of The London Hospital, thanks in large part to the handling and storage methods used.

Carmel College is an £18.5 million building project in St Helens. The overall construction project was quite conventional, but the contractor Keir North West put material logistics firmly at the top of the agenda, with positive results in both cost savings and environmental performance. Initiatives included:

  • Involving contractors – joint planning. Joint logistics planning with all contractors was introduced to focus on reducing unnecessary materials on site, eliminating damage, eliminating congestion and reducing double handling. The aim was a JIT approach to material delivery.
  • Controlling the inbound supply chain. This involved setting and enforcing strict delivery windows. Kier North West worked with contractors to avoid over-ordering and the build-up of excessive volumes on site. Inbound transport was scheduled so that some major items could be taken directly from vehicles into the work area – e.g. some roofing materials were never laid down in storage, which avoided double handling.
  • On-site storage. Dedicated storage areas for different contractors were introduced.  They were limited in size and overseen by Kier North West’s forklift operator. Well laid-out storage, good security, careful handling and a limited amount of material on site reduces waste through damage.
  • Material supply into the workplace. During build and fit out, rules were introduced limiting the amount of material that could be brought into the building at any one time. This reduced the risk of damage to materials, and it also improved working conditions and reduced the risk of injuries.
  • Material usage. Material usage was put under the spotlight by Kier North West’s project manager and it has been continually followed up with all contractors. This includes:
  • Controlling quantities carefully and avoiding over-ordering
  • Not automatically throwing off-cuts in the skip, but storing them without damaging them, and making concerted efforts to reuse them
  • Paying close attention to handling and storage methods so as to minimise – or eliminate – waste through damage

By focusing on logistics and involving all major contractors in the process, Keir North West not only achieved excellent environmental performance in terms of waste minimisation, it also reduced the cost of wasted materials by 60% compared with the expected level.

These examples, and the results of the other studies undertaken, demonstrate clearly how a well executed logistics strategy brings benefits to a construction project. There are reductions in waste and carbon emissions, and reductions in the costs of wasted materials.  However, potentially the largest benefit is improved productivity on site created by drastically cutting the time lost waiting for, looking for, and handling materials. Congestion and bottlenecks are reduced and, with just the appropriate quantity of materials in the right place, good logistics solutions maximise the productive time of the trade contractors, with the result of improving programme certainty.