If your business is reeling from the high costs of fleet management, it may be time to rethink your strategy. There are plenty of ways to cut costs and improve profitability – they just require a little planning.
1. Get Rid of Unnecessary Vehicles
You might have more vehicles than you really need. And if so, you’re spending thousands of dollars more per year than you should be. Cutting your fleet down to a more realistic number will trim your expenses in a hurry. In fact, you might be able to save as much as $5,000 to $8,000 per vehicle per year. (Not to mention the money you make back when you sell the unused vehicles.)
Obviously, getting rid of vehicles usually means other vehicles get more use (thereby driving up their operating costs). So make sure you take this into account and perform adequate preventative maintenance. You may also have to reconfigure routes so that they’re more efficient. This will allow you to get away with having fewer vehicles in your fleet.
2. Use Fleet Maintenance Software
Speaking of maintenance, you can dramatically improve efficiency with an investment in fleet maintenance software. Doing so will allow you to digitize work order management, enhance your ability to stay on top of safety and compliance standards, capture work history, automate preventive maintenance scheduling, and more. It’s basically like a centralized platform for ensuring your fleet is in tip-top shape at all times.
3. Train Drivers for Better Fuel Efficiency
Would it surprise you to learn that 53 percent of fleets exceed their annual projected fuel budget? This is due to a combination of factors such as traffic congestion, accounting errors, inefficient route planning, and inefficient driver behaviors.
One of the best things you can do is train your drivers to be more mindful of ways to improve fuel efficiency. For example, show them how to cut down on idling and simple ways to properly accelerate and brake.
4. Keep Parts on Hand
You’ll have to decide whether it’s more cost-effective to keep all of your vehicle maintenance and repairs in-house, or whether it makes sense to outsource to a nearby shop. Either way, it’s usually pretty cost-effective to keep basic/common parts in stock at all times. This allows you to quickly and inexpensively address issues without having to wait for parts to be delivered.
5. Shop Company Fuel Cards
Fuel costs are a significant expense line item for fleets. And if you want to save money, you should find the best fuel card possible and set up a fleet fuel account with them.
“Using a fleet fuel account will let you give drivers their company fuel cards,” Reading Truck explains. “Instead of wasting time and money to reimburse employees for fuel purchases, you can take advantage of the fact that the fuel card report makes it easier to track spending.”
As you shop around for fuel cards, consider the cost savings and the locations. For example, BP’s fuel card saves you roughly $0.06 per gallon, while the Fuelmen diesel card can cut prices by as much as $0.15. But if your routes are located in areas where there are more BP’s than Fuelmens, then it probably makes sense to go with the former over the latter,
6. Retread Tires
As you know, tires are a big expense for your fleet (especially if you’re working with large trucks). But instead of automatically purchasing new tires whenever the old ones wear out, you might be able to retread radial py casings. This could allow you to increase the mileage you get on a new set of tires to well over 100,000 miles. (And when you consider that retreading usually costs just one-third of the price of purchasing new tires, it’s a great way to save!)
Lower Your Fleet Management Costs
Slashing fleet management costs isn’t as difficult as some make it out to be. It’s time to take an honest look at your current approach and identify key areas where you can improve. And though you might not be able to address all of the tips outlined above, there should be at least a couple of techniques that you can implement right away.
Written by Alan Parker