5 Ways to Lower your Fleet’s Operating Cost
Fleet managers have always sought out ways to cut their operating costs. It’s what they’re paid to do. So what if you’re a small company and want to employ methods a fleet manager uses to save dollars from your bottom line. Here’s a few tips that fleet managers are currently using to do just that.
You may already be using a tax based software program. These programs, like Quicken and Intuit are great for small startup operations but fleets and the trucking industry have special tax advantages the programs may overlook. Consider consulting with a CPA that specializes in commercial fleet operations. They are aware of changes and advantages in the tax code that help grow your business effectively. Also, subscribe to blogs, fleet management associations, and fleet circulations. Stay informed on changes in the industry that help cut your costs and give you the advantage in selecting new equipment that qualify for tax rebates, credits, and incentives.
Fleet managers understand the importance of data that keeps their fleet moving. Managing that data becomes difficult, even in smaller operations, without effective software programs. The fleet manager must incorporate fuel spend, miles, unit type, fuel type, maintenance scheduling, and accident data among other information to accurately determine the best cost savings. An example may be a driver who routinely averages 5 mpg when his colleagues average 7 mpg on the same route. A review of driving habits, lack of checking tire pressure, or the driver making a non-circuitous route may reveal a culprit to the excessive fuel consumption.
A substantial loss area can be an accident, or series of accidents, involving company drivers who drive recklessly and without regard to the lost time putting a vehicle out of commission. It’s important to work closely with your insurance representative on the claim and develop a plan in the event an accident occurs. This may include a supplemental policy for the replacement and rental cost for a unit to fill the void, as well as finding a replacement driver. A proactive policy for accident reduction must be implemented, including online driver training courses, periodic co-driver reviews, and rewards for accident free miles. Combined, these will motivate drivers to drive defensively, lower your insurance costs, and possibly lessen court and administrative penalties by not ignoring problem drivers.
Every motor driven vehicle requires regular maintenance. No longer do we have the smoke and soot associated with noisy diesel motors of the past but it bears to mention that engineers have designed today’s high torque clean burning diesels with exceptional tolerances, powerful turbochargers, and emission reduction systems to be serviced according to a schedule. Ignore the maintenance due and you may risk damage to your investment. This doesn’t mean that you have to spend the most to get the best service. Smaller fleet’s that don’t have a garage can still do routine oil and filter changes and pre-negotiating prices with a commercial tire outlet can save hundreds off the tire expense. Keep your maintenance on a schedule that makes the most of your downtime, using evening or weekend time in order to keep the unit on the road when you need it.
In today’s competitive fuel marketplace, a company can save hundreds of dollars each month by simply understanding the purchase methods and locations of refueling. Often, drivers are presented a fuel card with instructions on how to use the card. These fuel cards may be proprietary, meaning they could only be used at a single vendor, or universal, meaning any fuel vendor. A fuel analyst can determine the best fuel card program for the company’s needs, determine the best locations for refueling, seek the most in rebates, and avoid overspend on tax exempt applications. Drivers are instructed on how to use mobile apps regarding where to get the best fuel discounts on their route, and not drive out of the way to refuel at proprietary locations needlessly. By using a fleet fuel card, you’ll get the reporting tools needed to make informed decisions. Most fleet fuel card companies have the reporting data exportable to Excel, which can be easily sorted and converted with formulas to understand the best cost saving transactions. A simple review of data and you’ll get a full picture of where your cost eaters and savers reside. Card programs like 360fuelcard.com also offer in network fuel rebates, thereby cutting the cost per gallon and more than covering the cost of the card itself. Essentially you get the fleet fuel card, all the reporting tools, security features, and other fleet related benefits plus cash back in your company’s pocket for just using it.