RERMAG

Don't Be The Biggest Loser

Criminal minds are often determined minds, and the minds of equipment thieves are no different. Those who steal equipment for a living — or even as a hobby for extra spending money — often think of innovative methods to get equipment off a jobsite and into their hands. Some will cut straight through fences to drive equipment off a worksite. Some will use forklifts to physically lift equipment over a fence. Some brazen thieves even get innocent bystanders to help them load equipment by pretending to be contractors or a rental company employee who is there to pick up a machine. No matter their methods, those determined to steal work hard to get around any obstacles in their way, which is one reason why equipment theft is the problem it is today.

Industry experts agree that the theft of construction equipment is on the rise. Although it's difficult to know an exact number, the 2005 Equipment Theft Report by the New York-based National Equipment Register, estimates that the total value of equipment stolen annually ranges between $300 million and $1 billion. This doesn't even take into account monetary losses from business interruption, project delay penalties and wasted workforce and management time. David Shillingford, president of the NER, says the statistics he's seeing indicate equipment theft is on the rise, but theft is still poorly measured.

“It's difficult to know if it's increasing or if we're better at recording data,” he says. Either way, Shillingford estimates that the approximately 5,000 thefts reported to the NER only represent 25 percent of all thefts, not including theft of hand tools.

The reasons equipment theft is difficult to track are some of the same reasons equipment is difficult to recover after it is stolen. Overall recovery rates are reported to be around 10 percent, quite a low number when compared to the rate of recovery on cars, which is regularly around 60 percent, Shillingford says. Pieces of equipment don't have license plates and the serial number is small. Little paperwork is involved in an equipment purchase, and no registration with the government is required. And because registration isn't required, determining ownership can be challenging, Shillingford says. Another deterrent to recovery: knowledge of equipment. It's difficult for those not in the construction industry to know the difference between a backhoe and a skid-steer loader. Many machine brands look similar and many are painted the same colors, making it difficult for the average law enforcement officer to identify. Most equipment thefts occur on the weekends, giving thieves a head start in their getaway. The longer it takes to report a theft, the lower the chance of the equipment being recovered, experts say.

The most commonly stolen pieces of equipment — skid steers, backhoes, generators, compressors — are also popular rental items, making the rental industry especially vulnerable to theft. These smaller items are often left on unsecured jobsites and are particularly easy to move. As Shillingford says, thieves aren't going to steal a $3 million crane, because they can't move it.

“They're going to steal a $30,000 or $40,000 piece of equipment that's easy for them to move at night or on the weekend, which is when most thefts occur,” he says.

Mel Baillie, vice president of marketing for Calgary, Alberta, Canada-based Longview Advantage, which offers fleet management solutions and theft protection capabilities, agrees that size is a determining factor regarding what equipment gets stolen.

“Small pieces of equipment likely move quicker or as we like to call it ‘grow legs fast,’” he says. Smaller and more mobile equipment is easier to get loaded onto a trailer and therefore easier to steal.

The rental industry faces several weaknesses regarding theft. Owners have less direct control of the equipment. If a company has one backhoe loader, odds are that the company knows where it is. But a fleet of backhoes is harder to control, Shillingford says. Items are often left abandoned between the end of a project and before pickup by the rental company. Rental customers also may just be more careless than the owners would be, and may not take the time to safeguard the equipment.

“Intuitively, you're going to take better care of your own equipment than something you've rented,” says Kathy Kelleher, national manager for the commercial division of Westwood, Mass.-based LoJack.

Thieves are also able to steal by fraud, such as starting up an account, renting equipment and disappearing with it, which is what happened to R-Quip Equipment Rental of Wichita, Kan., when an air compressor went missing. Because the persons responsible had used a fake ID and stolen checkbook, authorities were unable to recover the equipment. Troy Richardson, chief information officer for the company, says that the property is gated and locked and has had an alarm system to prevent break-ins. After the theft, the company completely overhauled its facilities and installed a state-of-the-art video and security monitoring system with more than 10 cameras that cover the inside and outside premises.

“This will not guarantee that we won't experience any thefts in the future, but it will definitely help us identify the perpetrators to give a fuller description and information when reporting it to the police to help in apprehension,” Richardson says.

But despite all statistics and obstacles, equipment owners and rental companies can take measures to prevent theft and many options are available to combat the problem. The LoJack Stolen Vehicle Recovery System, for example, consists of a hidden transmitter located on the machine that emits a silent signal that tells specially equipped police cars and helicopters where the stolen piece of equipment is. Once an equipment owner realizes equipment is missing, he calls the police, activating the system and putting the rest into the hands of the police. The owner doesn't even have to know he has LoJack on his equipment for the system to activate. In fact, the company has had an equipment recovery where the victim didn't know about its LoJack system. The recovery 45 minutes later was a pleasant surprise, Kelleher says.

With an equipment recovery rate of 72 percent after just five years in the construction equipment recovery sector, the company strives to get better and more efficient over time. The majority of equipment is recovered within 24 hours, and almost 25 percent is recovered less than an hour after being reported to police.

There are multiple locations on the equipment where LoJack transmitters can be installed. It looks like any manufacturer-installed item, so it's unlikely to attract the attention of a thief, according to Kelleher. The company is also careful with the installation of the system, with certified installers who go through background checks and certification classes.

“We're very careful about making sure it's randomly hidden and that no one's around when it's being installed,” Kelleher says. “We don't want people to know it's being installed or where it's being installed.”

A major rental company, which chose to remain anonymous, uses LoJack on its fleet. In fact, a salesman said that 100 percent of anything that's got a motor, is towed or driven, features LoJack. The investment has been a good one: All six pieces of equipment stolen from the California branch have been recovered.

“We equip certain categories of equipment known to be theft targets,” says an executive of another major rental company.

This strategy has paid off. Of 20 items that have been stolen, all but one have been recovered. “The program basically paid for itself,” he says.

What's out there?

Longview Advantage offers its vShepherd system, a GPS tracking system for theft protection and fleet management. The equipment owner can set a vFence around his assets, and if that fence is broken, the Longview Advantage Alarm and Recovery Center is notified. The company then takes a proactive approach to the recovery process, contacting the owner to let him know the breach occurred and contacting local law enforcement. Baillie says that most recoveries occur in less than an hour. Because of the quick response time and ability to catch thieves on the move, usually on the highway or public property, the recovery rate is around 98 percent. The combination of the technology and the 24/7 alarm center gives the company the ability to achieve that high of a success rate, Baillie says.

San Diego-based Qualcomm's GlobalTRACS solution is an asset-management system that also has theft-deterrent capabilities. One of its theft-related functions is that it allows users to create virtual boundaries to help prevent unauthorized use and reduce the risk of loss from theft. If a machine moves outside the boundary, alerts are sent according to customer-determined protocol. Automatic GPS positioning and street-level location mapping enhance the security of construction equipment.

Westboro, Mass.-based MicroLogic's iSite is a fleet management system that transmits location, run-hours and operating metrics to a PC using satellite communications, GPS, and Internet technologies. In addition to tracking equipment use and scheduling maintenance, iSite enables the recovery of stolen equipment by tracking its exact location in real time.

Companies like The Equipment Lock Co. and Quiplock strive to prevent theft before it happens. The Equipment Lock Co., based in Hedgesville, W.Va., offers a variety of changeable combination locks designed just for the rental industry. By locking drive controls or stabilizers in the down position, the locks prevent unauthorized users from easily accessing the equipment. Not only does this help stop potential theft, but stops other trades on the jobsite from using equipment and running it out of fuel, leaving it with a flat tire, or moving it to another area of the jobsite. Because the combination can be changed in about 10 seconds, the rental company can change it before every rental and make sure the renter has the combination on the rental contract. Bryan Witchey, vice president of sales and marketing for The Equipment Lock Co., emphasizes proactive equipment theft prevention.

“You'd be surprised at how many call after their equipment is stolen,” he says.

Roswell, Ga.-based Quiplock also offers a product for immobilizing hydraulic cylinders, the SleevLock, which is a lightweight, portable security device. The devices, which can be keyed all alike or all different, can be used on backhoes, skid steers, crawlers, trenchers, articulated loaders and trailer pintles.

Witchey says that equipment owners need to make theft as hard as possible for thieves because they want the “easy pickings.” Witchey says it would take a lot to disable a lock, but also says, “If you took the engine out of the equipment, you could still steal it.” If a thief knows he can go down the road to a skid-steer loader without a lock, odds are he'll go for the easier steal.

Registry with the National Equipment Register itself is another method of theft prevention. For just a few dollars per vehicle, equipment owners can register their equipment with the NER databases that monitor equipment ownership and theft. Registration is free for American Rental Association members. NER can then provide this information, along with equipment identification advice to police. These processes have directly led to the recovery of more than $7 million of stolen equipment, according to Shillingford. NER decals placed on registered equipment warn thieves of their increased chance of detection.

Orbit One's OrbiTrax satellite tracker solution is a tracking device designed especially for use during disaster and emergency management, such as during Hurricane Katrina. Garner Environmental Services, a company that helped with the relief effort after the storm, used OrbiTrax on rented equipment to keep track of it. Scott Rosenzweig, director of data solutions for Bozeman, Mont.-based Orbit One, says that the system works for the general recovery of equipment, not only for theft-related reasons, but when equipment is misplaced on a jobsite. If a piece of equipment can't be found, it is often assumed stolen, when it may really have been moved without the user's knowledge. Being able to track equipment can save in human resources and time. It can also save generators from running out of gas. In case of emergencies such as Katrina, generators provide much-needed power to hospitals. If a generator can't be found to refuel, it may have a devastating effect.

Even equipment and tool manufacturers are jumping on the anti-theft bandwagon. A number of Hilti products now feature an anti-theft system that will render a tool useless because the tool shuts down after 20 minutes if it's unplugged. Without an activation key, the tool becomes unusable.

Most experts agree that multiple strategies are the best bet in theft prevention. Sometimes seeing the glass as half empty can help to prevent theft.

“We strongly urge everyone to assume it'll eventually happen to them, because most likely it will,” LoJack's Kelleher says. She recommends taking a proactive approach, with multiple layers of protection. Basically, anything that can be done to slow a thief down is a good idea. Onsite security, bright lighting, chaining equipment together, and surveillance cameras can all hinder thievery.

“Information management is also a key process in helping to prevent theft — actions such as including your machines in the National Equipment Register and making sure you are in contact with the local police around the jobsites where your machines are used,” says Larry Cleary, senior director and general manager of construction equipment for Qualcomm Wireless Business Solutions.

As Shillingford says, it's a definite challenge to secure a jobsite, and anyone who says they can secure a jobsite 100 percent is wrong. It's extremely difficult to stop a determined thief.

“I believe that the most successful, most powerful way to deter a thief is to put it into his mind that he's going to get caught,” he says.

To reduce the risk of theft by fraud, Richardson recommends trusting gut instincts about customers. If someone seems uneasy or nervous about the transaction, that can be a clue. “In cases like these, asking more questions about what they are going to be using the equipment for and where can help to potentially prevent a bad rental from ever happening,” he says.

Anti-theft devices are all different and are trying to accomplish different goals. Locks are trying to prevent a theft before it happens, while other systems try to recover stolen equipment.

“One is saying ‘I'm going to stop you from stealing’ and the other is saying ‘Yeah, steal it, but I'm going to catch you,’” Shillingford says.

Also, some fleet management systems have many other capabilities, in addition to having theft recovery aspects. Each system has its definite advantages and disadvantages. Locks may be an inconvenience, but may make a thief move on. With LoJack, an owner must know of the theft to report it and activate the system. Some GPS can be circumvented by technology-savvy thieves. Fleet owners should do thorough research and find the product that most suits their needs before buying.

“Of course, you want to do everything you can to protect your business, and you have to be confident that you're investing your time, money, and energy effectively and efficiently,” Cleary says.

Theft not only costs rental companies the equipment stolen, but the deductible paid when it's stolen, as well as lost time, and lost revenue because missing equipment can't be rented.

“Any time you lose equipment, I don't care how new or how old it is, you lose,” Witchey says.

Stop, Thief!

Check out some of the available anti-theft systems to keep equipment safe.

Alpha Industries
www.alphalock.com

LoJack
www.lojack.com

Longview Advantage
www.longviewadvantage.com

Micrologic
www.micrologic.com

NER
www.nerusa.com

Orbit One
www.orbit-one.com

Qualcomm
www.qualcomm.com

Quiplock
www.quiplock.com

The Equipment Lock Co.
www.equipmentlock.com

Trailer Dog
www.trailerdog.com

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