How Trusses will be Priced in the Future

Although today you may be a “board footer,” or a “material times factor guy” or even a “time and motion person,” at sometime in the future you will be pricing your trusses and wall panels using a completely different system then you are today. I can I be so certain of this? It’s because there is a way to price components that simply makes too much sense not to use, and the tools to enable you to use this method either already are, or shortly will be, available to you.

What computers are good at

Beginning in the 1980’s running each individual truss on a computer replaced referencing a standard design in a manual. It did not take long to realize that the computer’s ability to calculate the truss’s material content (BF) or cost ($), (while checking the structural integrity) was too valuable and easy NOT to use. This spawned The Big Three pricing methods:

Board Foot x Factor – Flexible in that it can be used regardless of truss type (girder, attic,) simple in that you are dealing with one computer-generated number (BF) and one variable (the “Factor.”) Limited in that the Factor must take into account a lumber cost index, labor, markup and overhead.

Material Cost x Factor – Same idea – one computer generated number, one variable. Board footage and material cost tell the estimator nothing about the complexity of the truss, so either the complexity is ignored or has to be subjectively applied by looking at the profile of each truss.

Time and Motion – This is my shorthand name for any labor estimating formula composed of setup factors and “run” factors. It uses any number of calculable items about the truss to create the formula. For example, it might use the number of joints and pieces to estimate the setup time for the first truss, and the number of pieces to calculate how long it will take to build the 2nd, 3rd, 4th, etc. trusses – possibly adding a surcharge for long pieces, or 2x6 pieces, or longer trusses. A Time and Motion method always charges more per truss for smaller quantities and less per truss for larger quantities. Despite its obvious strengths, the Time and

Motion method, like its simpler cousins, still involves guessing; the difference is that the guessing involves more variables. More computer generated numbers paired with more Factors. The higher complexity of this method appeals to some, and puts off nearly as many.

As long as we attempt to use one of the “Big Three” to estimate labor (and other price factors) we are playing guessing game. Our Factors may have proven themselves worthy over the long haul, but on an individual job we frankly are going to have very little clue as to the what the factor should be, or why. When it comes to adding things up, computers are king. The “tough nut” is figuring the labor, and a computer examining a truss on a computer screen is innately limited in what it can do. Why? Because it is not looking at several things that we know intuitively are needed to really estimate what the labor cost will be.

What current methods lack

When using standard methods to price, we are not taking into account:

·What trusses will be built together? (what larger production group is the truss part of?)

·How will the pieces be parsed (what saw?) and sorted (in what order?)

·On which work centers will the trusses be built?

Looking at this in more detail, we know, or can figure out, what production groups the job will be subdivided into. We know how we batch jobs for the saw and what our sorting routines are. We know what table and stations we are most likely to build certain trusses on. And we know, or learn over time, the typical metrics for each piece of equipment (setup time per piece, run time per piece (saw) and per truss (table.)

We know all these things, but we don’t use them for estimating. Truss pricing in the future will.

The future

The pricing of the future will be by plant simulation. Once the design work is done (at least the initial pass,) the job passes to the plant simulator which:

·Knows how our saw strategies, creates a batch cutting list on the fly, and estimates the time each part of the process will take

·Knows how we break trusses into production groups, and does it

·Knows what station and table we build each type of truss, knows the metrics (expectancies) for that station, and then applies those expectancies to the work assigned to it

Plant simulation becomes an overwhelming array of numbers unless we can match those estimates up against their real-time counterparts. The “home run” here is to build an estimating simulation that includes only those metrics that you also are measuring in your plant. The more you can (or want to) measure, the more detailed (and potentially accurate) your simulation can be. This is where plant simulation differs from Time and Motion. No guessing; you need to see side by side your estimates next to your actuals.

My example is highly simplified; we would want much more detail in order to understand exactly what the difference was between what we thought would happen and what actually did happen. Plant Simulation is going to become the standard simply because no other method is as practical or accurate.

Is it worth keeping an old, inefficient saw in production when the work could be done on a more efficient saw?

Here is another thought experiment. Let’s say we have one saw that takes 20 seconds to set up, and another that takes a minute. We are now dividing up the work between the two of them, to keep both as busy as possible. Would we be better off retiring the old saw and just using the new one? I’ll present a method to answer that question and invite you to apply that method, using your own numbers, to your shop.

Let’s quantify several things about each saw.

1. How long does it take to set up a new piece, including the time between when the last piece has cleared the saw and the operator (or computer) initiates the next setup?

2. How long to set up a new piece if the new piece is also a different size (2x4 to 2x6, etc.)

3. How long to run the last piece through the saw before the next setup can be started?

Once we have these saw metrics, let’s look at the work we are doing. When we do, let’s make sure we get the number of:

1. Pieces

2. Length changes

3. Size changes

The two together will enable us to estimate how long it will take to cut the work on each saw.

We will make up some numbers for our ‘thought experiment’ saws:

The “sample job” MiTek distributes with its software has about 50 different roof trusses in it. Using the default sorting routines, the job breaks down as follows:

Let’s assume this is a typical job, but perhaps it isn’t a typical job for you! The only way to know is to run the numbers on your own jobs and see what you get. Moving on… Let’s see if we can come up with a plausible way to estimate the time it will take to cut this work. We’ll use numbers from the Old Saw first.

· The job begins, the saw sets up (30 seconds)

· The saw cuts (3.1) pieces (on average) and each one takes (2 seconds) to cut

· The saw takes (20 seconds) to clear

· Total = 56.2 seconds

This is repeated for each new piece (303) so the total is 303 x 56.2 seconds = 17028.6 seconds. Add to that 4 size changes for another 120 seconds (4 x [60 seconds for the size change – 30 seconds for the length change already accounted for]) and you get 17148.6 seconds or 4.76 hours.

Now, we will work the problem using New Guy numbers.

· The job begins, the saw sets up (15 seconds)

· The saw cuts (3.1) pieces and each one takes (2 seconds) to cut

· The saw takes (20 seconds) to clear

· Total = 41.2 seconds

303 new setups x 41.2 seconds is 12883.6 seconds plus 20 more for the four size changes and you have 12906.6 which is 3.59 hours.

Presented as a chart, this looks like:

About 33% less cutting time on the New Guy compared to the Old Guy. If they split the job up 50-50 (151.5 piece setups each) then the New Guy would be done with his work in 1.8 hours and the Old Guy would finish up in 2.4 hours. In order for them to finish at the same time you would have to give New Guy about 175 of the setups and the Old Guy about 128. They would both get done after about 2 hours. Putting this all in a chart:

In conclusion, it would seem that the least expensive way to cut the job is to have the most efficient saw cut it – and shut down the older saw. This is only true if the one saw can keep up with the shop. The two saws, working together and splitting their work more or less in proportion to their efficiency, would be able to cut four jobs like the “sample” job in eight hours. The New Guy saw, working alone, would only be able to cut 2¼ “sample” jobs in the same time.

We’ve only scratched the surface here. What about comparing costs when we give the Old Guy only “quantity greater than 10” work and give the rest to New Guy? Hopefully this method can be the starting point to your own investigations and lead you to new ways of thinking about how you use your component saws.

Some Links on the Internet

Here are some links that may be helpful.
 

Used Equipment Sites

There are still a lot of bargains out there. Wasserman and Associates has lots of listings. The font on their pages is very small, so I’ll share a Windows trick I’ve learned: On most web browsers, if you have a scroll wheel on your mouse you can hold down the Ctrl key and use the scroll wheel to make the text larger or smaller as needed. No scroll wheel? You can also hold down the Ctrl key and push the “+” or “-“ button to do the same thing.

Wood Truss Systems has a well-organized web site with lots of pictures.

More geared to heavy equipment is Iron Planet, which also has on-line auctions and an easy to use search capability.
 

Competing Against Conventional Framing

Let’s keep fighting the good fight against conventional framing. If we win that war there will be more work for everyone. What tools do we have for making sure we are effective advocates for components vs. stick framing?

The Framing the American Dream® project sponsored by WTCA featured two 2,600 square-foot homes built simultaneously. One was built using wood component systems framing, and the other fully engineered conventional stick framing. The brochure and video that came out of this project are probably the most professional, ready-for-distribution marketing material ever developed for competing with conventional framing. The videos come in 10- and 34-minute versions.

A nice summary of the advantages of structural components vs. stick framing is found on the Classic Truss (IN) web site.

From Rickie Bell’s Ezine article, I like these points:

· Conventional roof framing requires the use of larger framing members to form the roof plane as well as the ceiling resulting in higher labor costs.

· Each individual piece of the roof and ceiling must be figured out, marked, cut to length, then placed and nailed in the correct position.

· Requires the use of interior load bearing walls.

· May take several days to construct leaving the new home exposed to the elements for a longer period of time, increasing the chance for moisture damage.

· Highly experienced carpenters must be used further increasing labor costs.
 

Information

A lot of good code agency and association links are at Truss-Frame.com. Unfortunately, there are a number of broken links there, too.

Using Google’s Custom Search feature, I created a Wood Truss Industry Search Engine that looks at (only) 61 sites, so that if you want information on “linear saw” you will only get hits that are relevant to our industry.

What’s the ground snow load at your job site? Find out at Ground Snow Load by Zip Code. (Thanks, Mike.)

Manta is my favorite way to find out something about a business whose name I know, but very little else. It is a place to get started. Hoover’s is a second source.

Need your brain stimulated? Just visiting the TED website makes me feel “with it.” Click on “Business” if you want stay “on task.”
 

MiTek Stuff

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