With budgets tighter than ever and operational expenses on the rise, managing a fleet is getting more complicated by the day. Unfortunately, when already facing a laundry list of management challenges, that list is only getting longer. Fleet managers must work through increased regulations, supply chain issues, higher fuel and maintenance costs, replacement vehicle sourcing difficulties, and driver shortages — the list goes on and on.
How effectively fleet managers handle challenges always has a serious impact on their bottom line, but it can be especially impactful when budgets are stretched to the max. The key to making a positive impact and keeping the bottom line moving in the right direction is identifying and implementing strategies that help control costs, improve overall operations, and position your company for growth.
Following are five fleet management strategies to consider for increasing your company’s bottom line.
1. Monitor Driver Behavior
How your drivers handle their vehicles can impact fuel efficiency by 33%. So a few bad habits such as harsh braking, quick acceleration, and driving at inconsistent speeds can seriously damage the bottom line.
Monitoring driver behavior using engine data, advanced sensors, and GPS tracking systems gives you immediate insight on which drivers are costing you the most money. Plus, the findings can be used for training and driver education initiatives. Driving more efficiently will reduce fuel costs, help reduce accidents, lower maintenance costs, and extend vehicle life.
2. Improve Routing with GPS Tracking Software
Fuel is one of a fleet’s biggest expenses, so finding solutions to help make the most of your fuel dollar is always a top priority. GPS tracking software is one such solution and one that provides numerous bottom-line advantages beyond savings at the pump.
GPS tracking software provides a real-time overview of the location of each of your drivers at any given moment. With this knowledge, you can determine the best route, schedule drivers efficiently, plan workflow, allocate vehicles and resources, and meet service/delivery windows. These advantages add to lower operational costs, greater productivity, increased efficiencies, and greater customer satisfaction for better retention and more referrals.
3. Ensure Your Lease Mix Fits Your Needs
If you lease fleet vehicles, having the right number of vehicles with the optimal lease structure can significantly impact your cash flow and bottom line. In addition, a combination of leases may prove most beneficial for your needs. For example, you are using rentals for seasonal needs to supplement your existing fleet during periods of higher vehicle demand.
If you are not currently leasing, vehicle leasing is worth exploring as a cost reduction strategy — especially considering the rise in vehicle acquisition costs and vehicle availability constraints. However, leasing is not for every fleet; various factors need to be carefully examined. Areas to cover include your operational goals, financial picture, vehicle configurations, seasonal factors, and routes.
4. Take Advantage of Fleet Equity
Fleet vehicles are an asset. Vehicles can be leveraged for cash if you need cash to help manage day-to-day operations and keep business on track. There are a couple of methods to accomplish this. First, if assets are owned assets, they can be sold to a fleet management company and have them leased back to you, giving you a cash infusion that can be put to use where needed.
The other method is to dispose of unused vehicles or equipment. This can be done through traditional remarketing channels, such as auctions or a guaranteed buy program. If you choose a guaranteed buy program, a fleet management company gives you an upfront cash offer. They assume the risk and the responsibility of disposing of the vehicles.
5. Work With a Fleet Management Partner
The daily tasks involved with keeping vehicles on the road quickly multiply, forcing fleet managers to wear many hats while juggling demand after demand. Working with a fleet management partner can help tackle day-to-day demands while streamlining and simplifying the management of company assets.
Most fleet management companies offer a single, managed platform that provides full visibility into your fleet operations by monitoring a range of metrics. With this data, you can improve profitability, pinpoint problem areas, take immediate action, make more informed decisions, and identify opportunities to enhance productivity and efficiency.