From Warehouse to Worksite: Protecting Building Materials from Theft

• Theft and fraud are significant issues in the construction materials delivery industry. 
• Manual processes result in inefficiencies and losses. 
• Digital solutions help mitigate these problems by providing real-time updates, time-stamped photos, and enhanced documentation. 
• As highlighted by Richards Building Supply, the real-world impact includes theft prevention, improved customer satisfaction, and a reduction in financial losses. 

The journey from warehouse to construction site is fraught with challenges in the complex world of building materials distribution.

Theft and fraud remain prevalent, with construction sites and deliveries enroute being prime targets for criminals. The annual cost is pegged at $1 billion annually, according to statistics. 

Picture trucks laden with vital supplies rumbling through the pre-dawn darkness, navigating winding roads to reach their destinations. These vehicles are not just carriers of goods but also guardians of a company's reputation and financial well-being. Yet, lurking in the shadows are threats that can jeopardize everything. 

Distributors face the grim reality of theft daily. In the dead of night, thieves may target parked trucks, pilfering valuable materials meant for construction projects. Even in broad daylight, busy job sites can become hotbeds for opportunistic thieves who take unattended supplies. 

Why does theft occur? Reselling these materials is a profitable endeavor; the price of lumber, for example, was $565.50 US per thousand board feet in February 2024. If a single truck carrying 10,000 board feet of lumber is stolen, it would be a loss of $5,655. Multiply this by several thefts over time, and the financial losses can quickly escalate into tens or even hundreds of thousands of dollars. 

For building materials distributors, safeguarding cargo isn't just about protecting assets; it's about safeguarding the trust of contractors and homeowners who rely on timely deliveries. The repercussions of theft extend far beyond the immediate financial loss. Delays caused by missing materials can cascade into project setbacks, strained relationships, and tarnished reputations. 

Amidst these challenges, companies like Richards Building Supply (RBS), a distributor of various building materials such as windows, cabinets, and lumber, are beacons of resilience and innovation. RBS, like many others in the industry, faced the grim reality of theft and miscommunication, threatening their bottom line and customer trust. 

Before embracing digital solutions, RBS grappled with the inefficiencies of manual processes. Drivers, entrusted with the crucial task of delivering materials, lacked the tools needed to effectively document their journeys. Some branches gave drivers company cell phones while others didn’t. 

“They may have taken pictures [of deliveries] on a company cell phone and those were uploaded to a drive. Then all these pictures were dumped and somebody would have to manually label pictures, dates, and other details if they chose to do that,” explained Jenny Vetter, Logistics Manager at RBS. 

The process for recording deliveries was cumbersome and error-prone. Disputes over missing materials were commonplace, with the burden of proof falling squarely on the shoulders of the distribution company. Without accurate documentation, it’s not uncommon to get calls from contractors saying they were shorted an item. (i.e., “Four pieces of lumber came but I ordered five.”) 

“We could have documentation that we had it on our paperwork, but that doesn’t show we dropped it off at the job site. Even if the order was delivered in full, by the time the crew tells them there were only four, we can’t prove it. Then, we take the loss because the customer’s always right,” said Vetter, adding that before having a solution, RBS had to re-deliver these materials most of the time. In addition to material costs, fuel, labor, and vehicle wear and tear on vehicles impact the bottom line. 

The turning point came when RBS embraced digital transformation, implementing innovative solutions to revolutionize its operations. Descartes’ optimized route planning solution, including automated pre- and post-customer delivery notifications and electronic proof of delivery (ePOD), emerged as game-changers, offering a seamless blend of efficiency and security. 

• Time-stamped photos: Irrefutable proof of delivery completion. 

• Real-time updates: Text and email notifications provide unparalleled visibility. 

• Customer empowerment: Allows customers to cross-check deliveries with their orders. 

The benefits of digitization extended beyond mere efficiency gains. By leveraging Descartes’ advanced capabilities, RBS fortified its defenses against theft and fraud. Delivery notifications empowered customers to cross-check deliveries with their orders, revealing instances of theft and preventing potential losses. 

Vetter shared a scenario where Descartes made a significant impact: “In one of our first markets, we had one of our biggest customers set up notifications, and that customer received the pictures and he would look at them each night before the crew would go out the next morning. He looked at what he ordered compared to what we delivered. So, when the crew told him certain items weren’t at the site, he knew they were delivered. So he fired that crew for stealing.” 

Descartes’ ePOD has enabled the company to capture photo evidence of deliveries. This has been instrumental in preventing losses due to inaccurate customer claims. Often, crews working at a subdivision borrow material from one building site to use at another, explained Vetter. While these aren’t nefarious actions, the problem is a lack of documentation. Crews often forget about what was borrowed, leading them to inaccurately report they were shorted materials at the original site and that they needed to be replaced. 

“Now, not only do we have the paperwork trail, but we also have the pictures documenting it. That’s been amazing for us.” 

Jenny Vetter, Logistics Manager, RBS

RBS’ journey highlights the significant impact of digital transformation in addressing the persistent issues of theft and inefficiency in the construction material delivery industry. By implementing innovative solutions, RBS not only improved operational efficiency but also strengthened its defenses against theft and fraud, ensuring timely and accurate deliveries with a digital paper trail. 

If your company faces similar challenges, contact Descartes and its team of experts. Learn how comprehensive routing and mobile solutions can help digitize your operations, safeguard your materials, enhance efficiency, and protect your reputation. 

How to avoid theft of building materials? 

Digital solutions, such as real-time delivery tracking and electronic proof of delivery (ePOD), can help monitor and document the movement of materials, reducing the risk of theft. As a distributor, you want to ensure your goods arrive at the building site intact and that the journey is documented. It’s also imperative to quickly handle returns requests and document them effectively, as the longer materials sit, the more likely they are to vanish. 

What is the impact of theft on the construction industry? 

Theft significantly impacts the construction industry by causing financial losses, project delays, and strained relationships with customers. Stolen materials and equipment lead to unexpected costs and can increase insurance premiums. The delays caused by theft can extend project timelines, leading to additional expenses and potentially lost business opportunities. 

How does Descartes’ solutions help building material distributors? 

Descartes helps building materials distributors enhance delivery productivity and customer experience through optimized route planning, automated delivery notifications, and ePOD. These solutions streamline operations, reduce theft and fraud, and ensure timely and accurate deliveries. By addressing diverse needs, Descartes boosts efficiency for distributors.