Effective Strategies To Improve Savings In Your Fleet

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What Are Fleet Costs?

 

As the owner of a haulage company, or person in charge of a fleet, you understand the importance of keeping efficiency high and cost low. In this article, we’ll be looking at strategies to improve savings in your fleet. But let’s start by defining what we mean by “fleet costs”.

Here, fleet costs are the total amount spent on your assets and the fleet’s operating costs. When working out your fleet costs, a variety of elements must be taken into account.

Total costs of acquisition and licensing for your vehicles must be considered when managing fleet expenses, not to mention the ongoing costs of labour and maintenance. Another important consideration should be the amount you are charged for disposing of the vehicle once it has come to the end of its life span.

Any reliable fleet management guide will tell you the importance of collecting all the relevant data before making financial decisions. The first step, and one which is essential for calculating your overall fleet cost, is to ascertain your current fleet expenses.

 

 

How Are Fleet Costs Calculated? 

 

There are many different costs associated with running a fleet; some are fixed, and some are variable. Let’s begin with calculating the total cost of ownership (TCO), which is one of the most significant contributors to fleet expenses. This is done by taking the starting cost of a vehicle and adding the running costs before deducting the remaining asset value. This can be done for every vehicle in your fleet.

The next stage is to calculate the fleet’s operational costs. This is usually split into two categories: fixed and variable. Licences, labour charges and lease payments are fixed and are consistent throughout the year. Variable costs, on the other hand, would include unforeseen expenses such as vehicle maintenance and fluctuating fuel prices. Variable costs are harder to predict, which is why being able to track your vehicles daily will give you a better idea of running costs.

The importance of fleet asset management in calculating fleet costs is vital. Once you have gathered all this data, it should be clearer where some savings can be made, and overall costs can be reduced.

 

 

Eight Strategies To Improve Savings In Your Fleet

 

There are numerous ways to increase your fleet savings, all with different levels of input needed from you as the manager. While some of the suggestions below may not be relevant to your operation, they have all been shown to improve savings, so are well worth considering.

  • Reduce the size of your fleet

The most effective strategy to cut overall expenditures is to lower the number of vehicles in a fleet. Removing vehicles will eliminate all the costs associated with that asset. The higher workload needed from the remaining fleet vehicles will boost operating costs marginally, but overall, fleet operating costs will still be reduced, generating more fleet savings.

  • Reduce lifecycle costs

To reduce a vehicle’s life cycle cost, you must know the best time to replace it. Many fleet organisations use replacement planning systems to identify the proper life cycles for vehicle replacement. Fleet saving management can establish short and long-term replacement plans after evaluating all relevant cost aspects.

  • Lower maintenance costs

If possible, it’s best to have your fleet serviced simultaneously, rather than having each vehicle undergo checks independently, which could help save your business money. Undertaking all vehicle services in one go can reduce admin time, promote efficient fleet saving management, and simplify life.

  • Monitor the use of vehicles

By planning routes more efficiently, you can ensure drivers travel fewer miles, avoid trips with empty loads and always refuel at the optimum times. This can mean the difference between a firm that is profitable, and one that isn’t.

  • Install vehicle tracking systems

By being more aware of how the vehicles are operated and the routes they are taking, a fleet manager can use fleet management tracking to ensure that savings are made on every journey. Improved route-finding tools can help increase efficiency, making fleet savings on both fuel consumption and vehicle wear and tear.

  • Educate drivers about using fuel-efficient driving methods

Many organisations with fleets fail to consider the impact drivers have on vehicle fuel economy. Hard acceleration, idling, inconsistent speeds, excess use of air conditioning, and hard braking are bad driver habits that can be corrected with driver training. However, carrying out this extra training requires co-operation on all levels to achieve driver buy-in, acceptance, and success.

  • Introduce a fleet telematics system

Telematics is the simplest and most effective way to collect all of your fleet’s data and truly see the benefits of fleet management. This technology allows you to track various data from your vehicles in real-time, including the routes they take and engine diagnostics, mileage, and driver behaviour. Another great use of fleet management software.

  • Replace fleet vehicles at the optimum time

Frequent vehicle replacement may appear to be an unnecessary expense for your total budget, but it can offer fleet savings in the long term. Added costs involving repairs, poor fuel efficiency, downtime, and a lower resale value can be the outcome if you own and operate vehicles for too long. 

 

Lower Fleet Costs Through Better Fleet Fuel Efficiency

 

As a fleet manager, one of your challenges is to make your vehicles more productive. Any cost-cutting measures you implement could help your organisation save money and increase profit margins. Improving fuel efficiency creates fleet savings and reduces your fleet’s environmental impact, making your business leaner and greener.

Look at how fuel-efficient your vehicles are, both in terms of performance and how well your drivers operate them. Promoting safe driving habits, and performing routine maintenance, can help streamline your fleet’s operations, saving fuel and money.

By planning routes more efficiently, you can ensure drivers travel fewer miles, avoid trips with empty loads and always refuel at the optimum times. This can mean the difference between a firm that is profitable, and one that isn’t.

 

In Summary…

 

Fleet saving management helps your business remain more streamlined and easier to run and generates more revenue for your business. MyTrucking was designed by truckers, for truckers, and we know that running a fleet is no small feat. So, whether you’re looking for more ways to reduce costs or weighing up the benefits of leasing vs buying fleet vehicles, we’re here to offer support and advice.

 

External Links

 

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