It doesn’t matter what industry you’re in, reducing costs is a mind-numbing battle field for any business owner. For commercial fleet management, managing costs is the number one challenge faced daily – and the constant budget restraints don’t help either. With the never-ending struggle to ease the organisation expenses, fleet management needs reliable and constant tactics to help drive down those business costs – both in the short term, and in the long term.
The Australasian Fleet Management Assoc have identified several areas where all fleet managers can make substantial savings to your company bottom line. Check out these cost-cutting tips you can start implementing today!
- Reduce Fuel Consumption
The fluctuation in price of fuel has a big impact on fleet budgets with the uncertainty of future prices being a leading issue for fleet management. Predicting and balancing a fleet budget with the constant change in fuel prices is a struggle, but there are ways it can be reduced.
Elizabeth Edgar, Operations Manager at Fleetcare says fuel consumption can be better controlled through regular servicing and maintenance of your fleet. “Often business will leave the maintenance of their fleet up to the driver to maintain, it’s when these service schedules begin to slip that not only are there costs for unnecessary wear and tear, there’s also the side effect that any engine working harder to do its job will always consume more fuel.
Up keep of your fleet is essential to driver safety, and ultimately won’t see you chew through fuel”, Edgar advises. Of course when you’re going through the process of defining a “best buy” fleet policy, fuel consumption and ANCAP ratings should be the first items to consider once you’ve identified vehicles that are fit for purpose. Having the right size vehicle for the job is important and unnecessary weight should be reduced in the vehicle.
Whilst regular fleet management maintenance is key to reducing fuel consumption, having well-trained drivers and vehicle operators can be effective too. As a fleet manager, you should provide training to all drivers to help identify and avoid costly behaviours like rapid acceleration and use of cruise control. All fleet vehicles should be fitted with a GPS tracking device to allow monitoring of company vehicles and to ensure drivers take the most efficient route, cutting down on both time and fuel constraints.
A good Telematics system isn’t just tracking where your vehicles are on the road; it should be wired to the vehicle’s on-board computer (OBD port) and be able to identify for you, in real-time, fuel tank capacity which will give very accurate readings on fuel consumption, based on real-time fuel tank level’s compared to actual kilometres travelled. It’s also a good loss-prevention measure as you’re able to compare litres purchased through fuel dockets and compare those to fuel tank levels in the vehicle.
- Create a Fixed Maintenance Schedule
Fleet management maintenance schedules are crucial for both the fuel consumption of your vehicles and the quality of their lifespan. “A business might consider flattening their costs by taking on a fixed maintenance schedule as part of the fleet funding options, such as with an operating lease (fully maintained lease)”, says Edgar.
“Fleet management takes all the hard work out for you, by checking all the work on behalf of their clients”, says Edgar. “A fixed maintenance schedule together with a replacement programs can be customised for your fleet by engaging with an external fleet management company, you have access to the right decisions including vehicle servicing reminders”.
“For older fleet assets, a fixed maintenance schedule may not be your best option, but external Fleet Management can bring expertise to your fleet servicing decisions, ultimately saving you money. They’ll keep you informed of how much you’re spending on the service or maintenance before you spend a cent”, Edgar says. “The benefits of hearing this information by a fleet management professional means you’re told prior how much money will be spent and exactly where the costs have come from”.
As far as cost cuts go, fixed maintenance schedules and sound fleet maintenance advice from an external fleet management organisation can ensure a process that’s reliable and transparent. It ensures you get the most out of your vehicles, whilst having a good chunk of the hard work taken out for you and looked after by a professional.
- Tyre Maintenance Essentials
Regular tyre maintenance is essential to extend tyre wear, boost your vehicle’s performance and help to cut down on fuel consumption. Checking tyre treads regularly and as part of a daily or weekly vehicle maintenance safety check will help keep on top of tyre maintenance program. Tread depth ideally should not be less than 1.5mm..
Tyre pressure and rotation is also crucial to the survival and safety of your vehicle. Low pressure tyres can contribute to an increase in fuel consumption too, so it can be ideal to check with the vehicles user manual to see what the ideal pressure is.
Wheel alignment and balance of the tyres are also an important factor affecting overall performance. Ensuring the wheels of your vehicle are balanced will contribute to fuel savings and safety considerations. If ever in doubt about the roadworthiness of your tyres, it’s best to have a specialist look at them to repair and replace if necessary.
Read more about car tyre maintenance here.
- Implement Better Driving Habits
Training drivers and vehicle operators won’t just cut back on the fuel costs, but it will also be a positive encouragement on your vehicles overall performance and safety. Drivers should be educated about the importance of driving habits, and be familiar with the tools to implement better driving habits. “These are the behaviours business owners need to be targeting with their drivers.. “Instead of looking around for the cheapest car deal, more time needs to be spent on reinforcing positive driving habits to help drive down costs within the business”.
Risky behaviour should be eliminated at all costs – from excessive speeding to rapid acceleration and braking. By promoting changes to the way people in your organisation drive, there can be some substantial savings made. Simple acts of recognition and reward systems in place can help to encourage more positive driving habits too.
- Smarter Vehicle Selection – Leasing vs. Buying
In a short term bid to “save money”, the lifecycle of your vehicle can be overlooked. It is important that once your vehicle has reached the end of its cycle it is then replaced. Pushing your vehicle over its intended lifecycle may get you by in the short term, but the maintenance and costs surrounding it work out much more expensive in the long run.
Professional fleet management suggests there are better options. An alternative to buying vehicles outright is leasing – and it can be very cost effective for companies that may not have the initial funds to purchase a new vehicle”. “This gives companies a chance to release funds back into the business by leasing instead of buying outright.
Leasing vehicles has become a very cost-effective option for owners that want flexibility with their fleet. From short term rentals to long term, they’re able to effectively meet any business requirement and the ability to renew your lease and upgrade to a new vehicle every few years is extremely appealing to a lot of staff who are actually driving your fleet cars.
- Professional accident management
Specialised accident management will drive down crash rates, reduce fleet and operational costs, and improve driver safety. An accident management programme will also protect the integrity and value of vehicle assets. In addition to the general fleet management elements above, accident management covers road-side assistance & rescue, claims facilitation, full collision repair management, incident examination & trend reporting, as well as fleet & driver profiling. A tailored programme can deliver a one-call solution, with the objective of saving organisation and driver time, reducing time off the road, and improving operational efficiencies. Accident management data feeds back into the general fleet management factors above, to deliver relevant and targeted remedies.
Crash Management is NZ’s premier accident specialist and works closely with fleet leasing firms, vehicle manufacturers, and fleets of all sizes including government, corporate, and SME’s. Talk to us now about how we can help in our specialised area, and more broadly in the wider fleet management space by partnering with other expert providers to deliver a tailored solution to fit your unique requirements