How Kumar properties Reduced the Rebar Stock levels in the site by 50% and how they brought down Rebar wastage to a minimum of 0.5% from the Industry average of 3-5% ?
Rohit Vaikunth Sardesai is a Vice President at Kumar Properties Pune. Mr. Rohit is a Project Management professional with more than 23 years of experience in complex building projects. Kumar properties with 50 years of legacy in real estate development operates mainly in Pune Bangalore and Mumbai markets with focus on Mid segment residential Real estate projects. Rohit is responsible for technical operations at Kumar properties. He lives in Pune with his parents and family and loves to travel and explore new places. He can be reached at firstname.lastname@example.org
INDIAN Real estate constructions are in Growth Trend
Due to rapid urbanization lot of development is taking place in real estate housing segment in India for last 10 years. According to industry estimates the growth in real estate will continue to increase at multiple factors in coming years due to various government schemes like Pradhan mantri awas yojana or housing for urban poor in affordable segment as well as mid range housing project.
Controlling the Rebar wastage is a Challenge
In general typically REAL ESTATE is highly un-organized sector and lacks functioning like manufacturing setup and hence efficiencies are low and HIGH cost of wastage with poor inventory control. REBAR steel (Reinforcement steel) is a one of the largest single cost item in a residential multistoried building project which always lacks the site control resulting in higher inventory stocks getting maintained at site and very less efforts on optimization.
Uncontrolled Site Inventory
For projects where labour contractors are engaged it is a common picture to find that each building is looked upon as one project and high cost inventory like reinforcement steel is spread out at each building site rather than to have central yard. On top of this the steel cutting is left in hands of the bar binding foreman who will work out cutting lengths based on his experience and is not capable of optimizing steel cutting lengths and thereby ending up with higher qty of off-cuts, rework due to wrong cutting lengths etc. Frequent changes in these labour gangs due to migratory nature further complicates the process.
The story of controlling wastage in Kumar properties
Against all this gloomy picture one has to look out for a solution. This article is about our journey of overcoming this problem and developing a most optimized steel production set up to support our multiple locations of Real estate building projects.
Before implementing the process - Rebar wastage levels of 3-4%
Around 2012-13 we were facing common problem of Rebar steel where we used to have de-centralised steel procurement and consumption pattern based on our project sites. Because of number of projects going on at one time our steel inventory was going up with each site requiring minimum 60-80 tons of steel getting stocked, on top of this we were finding that out actual steel consumption was going more than what theoretical consumption and we were left behind with huge inventory of off-cuts as we approach towards finishing of project. Due to use of labour contractors we were also faced with a challenge of wrong steel length whenever new labour agency was coming on site. Our structural consultant was taking more time to check steel placement before doing any concrete. The worst problem was that at end of project reconciliation of steel was always questionable due to non-availability of good documentation and we had to agree for steel wastage between 3-4% average.
The Root cause identified – Rebar management cannot be adhoc.
We were growing with many multiplication construction projects within Pune city as well as in Bangalore. We decided to come out with a system which will solve all our pain areas. We realized that the main problem lies at the bottom-line in cutting of steel. If we can control how we are going to do cutting of steel we can control our further process. We were convinced that steel cutting can not be adhoc process and needs a good software to manage the process of steel cutting length based on structural design and further optimize these cutting schedules based on availability of full length bars as well as off cut inventory.
New process - Implementing RGS- REBAR, a 2D Detailing software that works on AutoCAD
After a lot of study and feedback from various other players in market we zoomed down on a software RGS-REBAR due to it’s simplicity yet effective and powerful features. Typically with this software we could achieve the following
- Rebar placement drawings in real-time based on AUTOCAD drawing platform. This ensures accurate bar placement with bar nos and qty worked out automatically by software. During placement process steel congestion and other detailing issues are resolved on drawing itself to help site construction team with simple placement instruction leaving no chance for interpretation or error.
- RGE REBAR will auto generate bar bending schedules (BBS) which are accurate without any extra bar or wrong lengths getting generated.
- Once BBS is checked and confirmed the software will generate cutting optimization program. In this one can feed bar lengths available including off cuts available for it to generate most optimum cutting program. This cutting schedule helps person operating cutting machine to understand what lengths gets cut from which bar and how to use off-cuts for cutting.
- The software also give output for bar tags which are handy in tagging up bundles and transporting and stacking of steel.
New Process – Centralized Stocking of Steel inventories
With introduction of this software we also made a major change on the way we were stocking steel inventories across many sites. We created two hubs and each hub would cater to 6-7 sites each site having 3-4 buildings. We also developed in-house software with link to our ERP system wherein we could get linked information on total procurement and issued vs stock available. Our inventory on each hub was brought down to 150-180ton with weekly procurement cycle to support inventory control resulting in huge savings of inventory holding cost. Due to centralized location control on off cuts was achieved with off cuts of one site getting used on other site. The centralized hub concept further brought us benefits in terms of operation efficiency of inventory receipt/ store/issue and we could implement use of couplers in columns due to centralised threading machines.
Results achieved – Less than 0.5% of Steel Wastage
In less than 6-8 months of implementing these initiatives we could achieve the following improvements in our projects
- Reduced Site inventory by at least 50% (We no longer need each site having stock of different dia of bars)
- Steel wastage is brought down to less than 0.5 % against each site earlier having wastage between 3-5%
- Better site control on Steel placement due to availability of steel placement drawings.
- On site very less space required to store cut steel bundled with tags based on JUST IN TIME principles.
- Zero pilferage/ wastage due to controlled stock of steel full length bars and off cuts at central hubs.
- Structural consultant checking at site happens very smoothly and fast as he gets to see placement drawings along with sizing and spacing.
- Most optimum use of resources such as cutting machine, weight bridge now getting used most efficiently on one site reducing operating costs drastically.
- Steel consumption on site is now equal to theoretical consumption with savings on at least 300-600 gms/sft
Issues to overcome to save Steel
The journey from past to present was not easy. It needed management support as well as team members commitment towards this initiative. With labor agency getting deployed on our sites we also had many change management issues whi ch needed to be overcome. They were typically
- Strong need to have technical manpower (Experienced Rebar Detailers) to operate RGS Rebar software with industry experience of actual site conditions to come out with solutions
- Acceptance of cut steel supply practice which means site needs advanced planning and no extra areas / shortcuts can be taken.
- Contractor team getting used to handling of pre cut steel.
- Cut length re-bar storage is an art and science. One has to understand how to stock material on project site and then lift up material for placement to take benefit of efficiency while placing the re-bar at actual location.
I believe we have now reached a stabilization point in our system operations and we now want to take up work on improving efficiencies in terms of inventory and delivery.
I am very happy to state that with right use of technology e.g. RGS -REBAR software and support of team we could overcome a long pending problem of RE-BAR detailing and production for various our real estate projects.
More photos from the Centralized Site