The Third Critical Challenge Facing Every Owner & Manager in The Crane & Lifting Industry Today – A Series
This is challenge number three in our five-part series.
In today’s competitive landscape, the crane and lifting industry is facing mounting pressures from increasing operational costs. As a result, many businesses are finding themselves in survival mode, forced to make difficult decisions that impact their long-term sustainability. One of the most significant challenges in this environment is managing the costs associated with equipment damage, failure, and the subsequent delays to projects.
Economic downturns often lead to cutbacks in critical areas like safety investments and risk management programs. In many cases, loss-control personnel are laid off, and necessary upgrades to aging equipment are delayed. With fewer employees handling more responsibilities, it becomes difficult to maintain the operational standards required to prevent breakdowns and accidents.
The Impact:
- Equipment Damage
- Increased Risk of Accidents
- Wasted Funds
When equipment is not maintained properly, the risk of breakdowns increases, leading to potentially expensive replacement costs. For instance, replacing a rough terrain crane can cost anywhere between $200,000 and $1,000,000, a major financial burden for any company. Similarly, rental costs for cranes can add up quickly, with daily rental rates for a rough terrain crane ranging from $2,000 to $5,000. Large lattice boom crawlers can cost over $15,000 per day, significantly eroding profit margins.
Project Delays Due to Equipment Problems
The crane and lifting industry is particularly vulnerable to project delays, especially in offshore operations where time is of the essence. Equipment damage or failure can result in cascading delays, including:
- Time and Cost Overruns
- Disputes and Litigation
- Waiting for Rented Equipment
The financial impact of these delays can be catastrophic, and no business can afford to lose valuable time due to poorly maintained or damaged equipment.
A Proactive Solution: Routine Inspections
One of the most effective ways to mitigate these risks is through consistent, thorough equipment inspections. Ensuring your lifting equipment is regularly checked and properly maintained can reduce the chances of costly breakdowns. Routine inspections are a proactive step that help businesses save time, reduce risks, and ultimately save money.
The U.S. Occupational Safety and Health Administration (OSHA) conducted over 34,000 inspections in 2023 alone, reflecting an ongoing trend of increasing enforcement. These inspections were split into programmed and unprogrammed categories, with some focused on fatalities or catastrophic events. The goal is clear: prepare for the unexpected and maintain a safe and productive work environment.
The Benefits of Regular Inspections
Implementing OSHA-required “frequent” and “periodic” inspections carried out by trained and qualified inspectors offers several key advantages:
- Enhanced Safety: A safer, more productive environment for employees.
- Reduced Accidents and Failures: A proactive approach reduces the likelihood of accidents and equipment failure.
- Reduced Downtime: Proper preventative maintenance can reduce downtime by up to 85%.
- Lower Maintenance Costs: Preventative maintenance has been shown to save 12-18% in comparison to reactive maintenance.
The ROI of Predictive Maintenance
According to the U.S. Department of Energy, predictive maintenance can yield impressive results:
- Return on Investment: 10x
- Reduction in Maintenance Costs: 25%-30%
- Elimination of Breakdowns: 70%-75%
- Reduction in Downtime: 35%-45%
- Increase in Production: 20%-25%
The Importance of Thorough Inspections
OSHA outlines the essential components that must be checked during inspections, including operational mechanisms, excessive wear, and maladjustments that can interfere with the proper operation of lifting equipment. These inspections go beyond basic visual checks, ensuring that every aspect of the equipment is functioning optimally.
For critical equipment, such as process cranes, downtime can result in costs exceeding $1 million per day. Routine inspections help prevent such breakdowns from occurring, ensuring smooth operations and protecting the company’s bottom line.
By prioritizing preventative maintenance and regular inspections, crane and lifting businesses can mitigate the risks associated with equipment failure, reduce costs, and maintain a safer working environment for everyone involved.
