The High Cost of Construction Site Theft

Construction site theft is a major issue plaguing the construction industry. From building materials to tools to heavy equipment, construction site theft is an industry wide epidemic. In addition to the direct costs of replacing the stolen goods, there is also the indirect cost due to increased insurance premiums, rental costs to replace stolen equipment and lost productivity. Delays in production can also result in hefty fines laid out in the contract if deadlines are not met.

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An unsecured construction site

While no concrete numbers are available, most industry experts estimate that losses due to construction site theft reaches $1 billion or more annually. According to the National Equipment Register’s (NER) 2011 Equipment Theft Report, the total value of stolen heavy equipment alone was close to $300 million for the previous year. It should be noted that this report focuses solely on heavy equipment losses and does not factor in stolen building materials, tools or the other indirect costs mentioned earlier.

According to the NER, the top five states for heavy equipment theft with the highest incidences were Texas, North Carolina, Florida, California and Georgia. Those five states accounted for 40% of all heavy equipment thefts nationwide in 2011. The top contributing factors for the types of equipment stolen are its resale value and the ease in which it can be moved from the construction site. Backhoes and skid steers are the most common pieces of equipment stolen from construction sites because they can be easily transported and resold for tens of thousands of dollars depending on condition, make and model.

Copper is another hot commodity for theft at construction sites. Large quantities of copper can be found at construction sites due to its numerous applications in a variety of building materials. Copper tubing is used in plumbing and heating applications, copper wire is found in electrical and communications wiring as well as in other architectural uses such as roofs and wall claddings. With the price of copper currently trading at $3.62/lb. and scrap copper prices reaching nearly 90% of that amount depending on its quality and purity it is easy to see why it’s a popular target among thieves. Over the past couple of years new state laws across the country have been enacted to curb thieves by requiring scrap yards to require photo ID’s from sellers or requiring buyers to pay by check for scrap metal instead of cash.

While heavy equipment and copper are among the most commonly stolen commodities at construction sites, any items that can be easily removed and resold are being targeted by thieves including tools, building supplies and scrap materials. Thieves are creatures of opportunity so taking steps to secure your construction site is essential. The key is to make it as hard as possible for would be thieves to quickly make off with your tools, equipment and materials. A well-lit, fenced-in construction site with posted “No Trespassing” signs is less likely to be targeted than one that is not.

Erecting an 8-ft. tall, razor wire topped fence with infrared security cameras surrounding the perimeter with armed security guards on patrol after hours isn’t always a viable option. So let’s take a look at some of the other preventative measures you can take to secure your construction site.

Establish a theft prevention policy and ensure all employees and subcontractors are made aware of the rules and consequences for stealing. This can include borrowing tools for use on side jobs or after hours and removing scrap material for personal use or sale. Create a zero tolerance policy for offenders and inform employees and subcontractors that if caught you will seek prosecution. Work with local authorities so they know when personnel are allowed to be on the site working and ask if they can perform extra patrols by your site during nonworking hours.

Secure your construction site by locking up tools and building materials in storage boxes and cargo trailers with heavy gauge, tamper resistant locks and chains. Maintain an inventory log of all materials, tools, equipment and keys to ensure that everything is accounted for at the end of each workday. Keep all keys in central and secured locations and a log of who checked them out.

The NER states that in 2011 only 21% of stolen equipment was recovered and with an average estimated value of $22,300 per piece of equipment, showing up at your construction site to find a front end loader missing can greatly affect your company’s bottom line. Securing your heavy equipment can be as simple and low tech as removing batteries or wheels, lowering blades and buckets, and locks designed to immobilize controls or to keep the wheels from moving in a straight line to more high tech options such as alarms, fuel and ignition cut-off switches, geo-fencing using radio frequency identification and GPS tracking devices.

According to the National Insurance Crime Bureau, equipment manufacturers adopted a standard worldwide 17-digit product identification number (PIN) system beginning with their year 2000 models. Have this number engraved or bead welded on two separate locations of the equipment, one obvious and one hidden, in order to identify in the event of a theft. Keep records of make, model and the serial number or PIN along with photos of each piece of equipment from multiple angles.

Consider registering you equipment with a company like the National Equipment Register or the Heavy Equipment Registration  which provides free access to law enforcement to aid in recovery of stolen equipment.

While taking all these steps won’t guarantee your company will never have anything stolen, it will go a long way in deterring would-be thieves from targeting your construction site. To find out more on theft prevention and ways to secure your construction site contact your local contractors’ theft prevention organization, local contractors’ association or law enforcement agency for more information.

 

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