Using multi-year contracts to
purchase snowplows and components
could save time and $620,000

By reducing the amount of time required to purchase and deliver new snowplow trucks to the districts, ITD can provide a higher level of service to meet the needs of highway end users in the winter.

Reducing operating costs by about $40,000 per year, and saving about $620,000 on chassis (based on an average of 30 new units yearly), is just icing on the cake.

ITD's snowplow truck replacement plan requires purchasing new trucks on a yearly basis. Developing specifications and completing the bidding process typically requires about six months., the time required to receive the truck chassis and then have the snowplow equipment installed generally takes around nine months which means new trucks are not delivered within the same fiscal year they were planned or budgeted. This process increases the amount of time that ITD is required to operate the equipment that has already met its intended life cycle, resulting in higher operational costs for the equipment.

To combat this lag in new equipment arrival, an annual definite quantity bid for snowplow trucks and components was scrapped in favor of an indefinite-quantity, multi-year renewal contracts for snowplow truck chassis, hydraulic systems, dump bodies, wing plows, v-box spreaders, and liquid deicing tanks.

This bidding process will allow ITD to order the required snowplow trucks without having to conduct the bid process. This will also allow snowplow trucks to be ordered at the start of the fiscal year with anticipated delivery by the end of the fiscal year. Another benefit is the price is now known based on the current contract.

This has already shown to reduce the unit cost of each component as the contract is awarded for greater quantities of units – ITD benefits from Economies of Scale.

Due to a time lag in getting the contracts bid and awarded, "We won't have any new trucks for this winter," ITD Fleet Manager Steve Spoor explained. "We now have the contracts in place, but delivery is an issue. We placed orders for 60 trucks in April from Freightliner, but will not see the first chassis until December and the first completed snowplow truck until the summer of 2019." The first trucks will replace 1996 to 2003 model year trucks in Districts 5 and 1.

The next planned purchase will be to replace 14 year old trucks in District 6. "It is our goal to have the 60 new snowplow trucks to the Districts by the 2019/2020 winter season.

Published 08-03-18