Fleet managers recognize that operating costs can quickly accumulate. Many business owners find that they spend over 50% of their total fleet operating costs on fuel, tolls, administrative tasks, and maintenance. They must find ways to properly manage these costs or risk shrinking profit margins and additional inefficiencies.
How often do people assume that fleet cost reduction focuses on cutting expenses? In reality, the goal of the fleet manager is to optimize operations, increase efficiency, and minimize waste. Proactive measures are needed to help them achieve this goal. Many companies are utilizing a Motor Transport Alliance fuel card to reduce costs, while others are consolidating their toll payments. Real-time reporting tools enable fleet managers to identify areas where changes are needed. The following strategies can help them reduce costs while increasing efficiency.
Toll Management
Fleet managers spend a significant amount of time manually managing total expenses. By utilizing automated toll processing, they gain a clearer understanding of total transactions while reducing fleet costs. Automating this task simplifies expense tracking while increasing the efficiency of reporting. The company will no longer need to worry about violations and misreads, which can be costly. They gain better control of their fleet costs while boosting operational efficiency.
Optimizing Routes
The first thing a company should do when trying to reduce fleet costs is to optimize its routes. Doing so improves operational efficiency while reducing fuel expenses and wear and tear on vehicles. GPS tracking and real-time traffic data are essential for optimizing these routes, and fleet managers must be aware of toll roads when planning them. However, they must ensure deliveries are made on time when making these changes. Never assume the shortest distance is the best route. Several factors must be considered when planning a route, including traffic patterns, vehicle type restrictions, and toll road expenses.
Preventative Maintenance
Very few things frustrate a fleet operator more than an unexpected breakdown. Whenever a vehicle is out of commission, deliveries may be delayed, deadlines may be missed, and customers will be unhappy. Furthermore, the company is looking at expensive repairs. Proactive preventative maintenance helps keep fleet costs down. The vehicle should be inspected regularly and serviced according to the manufacturer’s recommendations. When a repair is needed, it should be done as soon as possible. Addressing minor issues before they escalate helps save the fleet owner time, money, and frustration.
Telematics
Fleet managers must also recognize the role of drivers and optimize fuel management. Telematics can be used to track and monitor driver and vehicle performance. Thanks to the insights gained, the fleet manager can maximize the performance of both the fleet vehicle and the operator. Real-time driver monitoring enables the prompt detection and correction of poor driving habits. When these corrections are made, the company sees immediate savings. Furthermore, telematic systems alert the fleet manager when a problem arises with a vehicle, allowing for prompt action to prevent a breakdown.
Fleet managers find they can take additional steps to keep their costs under control. They need to ensure they have the proper number of vehicles to complete operations without incurring unnecessary expenses in this area. Right-sizing the fleet can quickly lead to cost savings. Additionally, the company should consider automating administrative tasks to reduce costs and increase efficiency. Taking steps such as these will help a company bring fleet costs under control without harming operations. The venture will be more profitable, which is what every business owner wants.