Inside Construction – The Importance of Logistics in Construction

Inside Construction wrote about our software’s ability to impact construction company’s logistics processes for the better in this article, also shared below. A bit of a lean towards the Australian market, but with lessons on how using scheduling software can help increase efficiencies and save everyone time and money.

Logistics has a massive impact on Australia – almost 9% of GDP and employing well over 1.2 million people, and unsurprisingly the construction industry is a major user.

Even as a multi-trillion dollar global industry, it has yet to be truly transformed by technology and remains beset by inefficiency – and this inefficiency thus impacts all of us. The impact can be particularly felt in sectors that have low margins and resource constraints, like construction.

Voyage Control, a London-based business set up by an Australian, but with offices and clients around the world, likens itself to an “air traffic control system for trucks” to optimise deliveries and operational processes for busy logistics hubs, including construction sites. However, the basic premise behind the company didn’t come from the construction or logistics sector, but from the time James Swanston, the founder of the company, spent in the Australian Army.

In the military, a lot of his work was around helping to provide information to battlefield commanders so that they could be proactive in decision making with the most up-to-date intelligence available. A theory developed in the Korean War called the Boyd Cycle sought to explain how US fighter jets were winning over their Russian-built competition, and it came down to the ability to make better decisions quicker than their enemy. This same logic applies directly to business, and these same principles enable success – and in the dynamic world of managing a construction site, the same is true.

Anyone on a construction site will know the challenges of not knowing where your deliveries are, whether the right stuff is being delivered, and spending wasteful hours on the phone trying to work out who needs to come and when. This is all complicated further in inner city construction projects where loading bays are tight and it’s easy to cause a traffic jam if a truck has to wait on a busy street because the loading bay is full. Furthermore, where you have potential criminal sanctions for supply chain logistics not being managed properly, the stakes are high.


Cranes are a constrained resource. Even when there are multiple cranes, trucks can still be forced to wait for the one they need to drop materials off at.


While logistics costs are direct or indirect depending on who you are (project owner, construction company, subcontractor, haulier), ultimately they all have an impact on the bottom line. Material handling is clearly the largest single cost; it is also not uncommon to have a site superintendent spending half their day on the phone trying to schedule deliveries too, and the cost of having an unproductive crane or hoist operator can be significant.

Failures in material handling can range at the lower end from parking tickets, damaged goods, and demurrage charges and at the high end can cause project delays and insurance problems, and there are certain cases where logistics problems have caused multi-billion dollar headaches. It doesn’t take long to eat into already small profit margins though.

The movement of goods (and sometimes staff) to jobsites is often an important issue that gets raised during planning permission, particularly in congested, inner city areas. As cities adopt more stringent rules about freight deliveries, there will be increasing regulation for construction projects.

The other big value in digitising logistics management is that you can start to build an audit trail and incorporate knowledge of what is happening. Putting everything on paper, or a whiteboard that gets wiped clean every week, doesn’t lend itself to robust operational analysis, or being able to see where problems are arising with logistics and your supply chain.

Manual processes involving whiteboards, faxes, and paper trails are no longer the best way to do business, even if people are very comfortable with them. Companies that don’t embrace new solutions won’t survive, but those that do will prosper.

For more information, contact

Thanks to Simon Gould for putting this piece together with us!

Link to our Q&A with Inside Construction here.


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