Fleet
We realise companies depend on fleet vehicles to conduct everyday business – weather it’s trucks or cars they need to be maintenanced. The complete pricing of vehicle maintenance together with taking vehicles and drivers out of service may regularly leave a negative impact on your service levels and profits.
Boosting your profits is the biggest goal of any business, but these days it’s very hard for fleet managers because they are constantly under pressure to reduce cost be it from fuel consumption, maintenance or other things. That’s why for successful fleet management it is crucial to understand all of the aspects that go into your fleet costs.
The complete cost of owning your fleet is made up out of the purchase price of your assets along with the cost of your operations. It is basic knowledge for business to think about their Total Cost of Ownership (TCO) when making an investment decision, and it is very important when you look to get a better understanding of your fleets management costs. Effective cost management begins with a complete extensive fleet cost management analysis.
Having to define key metrics that you will want to measure and track such as utilizing, cost per unit/vehicle and depreciation.
You have to know your fleet’s primary costs, which usually are:
- Vehicle price and associated interests
- Operating costs
- Maintenance costs
- Downtime costs
- Driver costs
Defining driver costs for each of the key metrics that you will be following.
Minimizing fleet costs
Methods for minimizing fleet costs and TCO is going to be different for every fleet, but the following three main points have proved to be the best at minimizing vehicle fleet and TCO.
1. Getting a fleet whose size fits your needs. You may possess too many or not enough vehicles for your fleet. By completing a utilization analysis of your fleet is a big step forward in determining the optimal number and types of vehicles that you need.
2. Ordering from a single manufacturer and negotiating aggressively about fleet incentives.
3. Replacing old vehicles and optimizing your replacement policy. That means you should take some time to determine at what point does it make sense to financially replace old vehicles that may be influencing your repair costs.
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