As a business you should always be looking at ways to lower your overheads, and one of the most significant expenditures for many companies is their fleet of vehicles. Just because you rely on a fleet to run operations smoothly shouldn’t mean you have to break the bank to have one. When it comes to vehicle management there are numerous outgoings to consider, from direct expenditures like fuel and insurance, to indirect costs stemming from factors like driver inefficiency. Here are a few ways that you can go about cutting fleet costs:
1. Invest in telematics software
Investing in fleet management software may require an initial outlay, but over time the savings made on optimising your fleet can be enormous. The software, also known as telematics, uses GPS and other technologies to track information about a given vehicle, such as its live location, fuel consumption and driver efficiency. This data is collected from the vehicle’s engine and is sent to your smartphone to give you real-time overview of your vehicle and overall fleet efficiency.
By remotely monitoring a fleet’s performance you can reduce expenditure accordingly. As telematics company Movolytics note, fuel management systems can slash fuel spend by at least 10%. The software will inform you when drivers are engaging in fuel wasting behaviours such as speeding, excessive idling, and rapid acceleration. With this information you can train your drivers to drive more efficiently, helping to cut down the cost of your fleet.
The software can also help your drivers plan their routes more efficiently to use less fuel. Live traffic alerts can help drivers avoid traffic jams and GPS fleet tracking can even reroute drivers if they are heading towards congestion, instead directing them towards optimised routes that use limited fuel.
2. Ensure vehicles are regularly maintained
Regularly maintaining your fleet of vehicles is of paramount importance. Poorly maintained vehicles are more likely to break down, temporarily stretching your fleet and costing your business hundreds, or even thousands, in repair fees. The company could also lose out financially in terms of failed deliveries, which could affect a relationship with a client and ultimately lose you more sales in the long run.
Not only is maintenance important in preventing vehicle downtime, not to mention a fundamental safety measure, but not routinely checking the condition of your vehicles can adversely affect your fleet’s miles per gallon rating. For instance, dirty engines use a lot more fuel than clean engines, while worn tyres can slow down a vehicle’s acceleration, meaning the motor has to work harder and ultimately use more fuel. Furthermore, ensuring tyres are inflated to the recommended pressure can improve your gas mileage by 3.3%, saving up to $800 per vehicle per year.
3. Streamline your fleet
Does your business really require all of the vehicles currently in your fleet? Instead of holding on to vehicles your company doesn’t require, or handing out company cars to employees that don’t actually need them, streamlining your fleet will enable you to immediately cut costs. Openreach famously saved £10 million by shaving 2,000 vehicles off its 24,000 strong fleet in 2012.
It’s also worth looking at the type of vehicles which actually make up your fleet. If it is loaded with older vehicles, it could be a good idea to upgrade them. Even though this will cost you in the short term, it will pay off in the long run. Older vehicles are more likely to break down and will need more maintenance checks and repairs. They also tend to have lower fuel efficiency than newer models. The costs of constantly maintaining these vehicles and the extra fuel they use could ultimately outweigh what you’d spend replacing them. Removing them from your books will save money that you can better use elsewhere.
By investing in fleet management technology, regularly maintaining your vehicles and streamlining your fleet, you should start to see significant savings in your fleet expenditure, and your business’ spending as a whole.