Transform Your Fleet from a Cost Liability into a Revenue Generator
Many companies misguidedly treat fleets as a necessary cost of doing business – but what if there was a way you could change that? What if you could increase cost savings by using new technologies to create safer drivers, reduce downtime and optimize the vehicle life-cycle? In a recent article published by Food & Drink International: “Lessen the Liability,” Tony Candeloro, senior vice president of technology & operations, discusses three easy ways to identify new cost savings within your fleet that can help to transform it from a cost liability into a revenue generator.
For the most part, the costs involved in running a fleet are among the top three biggest expenses for companies that rely on vehicles. But as new technology helps fleets gain real-time insight to driver behavior, companies are becoming empowered to take immediate action. Now, those responsible for running the fleet can track fuel usage, driver behavior, vehicle downtime and countless other data points that translate very easily into real dollars and cents.
Creating Safer Drivers
Over time, poor driving habits can become costly. When left uncorrected, poor driving habits can drastically decrease fuel efficiency and increase wear and tear on the vehicle itself. When poor driving habits cause a fleet vehicle to become severely damaged in an accident, you may need to order an entirely new vehicle, which can result in an additional impact to your bottom line. In fact, according to the Occupational Safety and Health Administration, the average cost of a motor vehicle crash is more than $16,000 if there are no injuries, $74,000 if there are injuries and more than $500,000 if there are fatalities. What if you could have prevented these accidents by identifying risky drivers early and giving them proper safety training?
With the recent surge in distracted driving incidents, it’s more important than ever to have a behind-the-scene understanding of what’s happening within your fleet. Once the data has been collected, you should tackle the most prevalent issues and then analyze how they impact your fleet’s accident rate. Companies who have taken these steps have seen dramatic declines in the frequency and severity of accidents. In one case, a company fleet was able to reduce accident-related costs by more than $1 million in just 12 months.
Reducing Vehicle Downtime
Beyond reducing accident counts, keeping up-to-date on preventative maintenance can reduce the chance of issues as the vehicle ages. Depending on the type of vehicle, an hour of downtime can cost a company an average of $150. New technology has made it simpler to track maintenance schedules by sending alerts to fleet managers. Geofencing technology can inform fleet managers when a vehicle enters a shop so that they can follow up accordingly. Most systems will also send an alert that the vehicle has left the shop property, so it’s known when a rental vehicle can be returned and the fleet vehicle can get back to work.
Knowing When to Pull the Plug
At a certain point in the lifespan of a vehicle, it will cost more to maintain the vehicle than it’s worth. Identifying that turning point can be tricky. Naturally, you want to squeeze as much out of a vehicle as you can, but most often that doesn’t make sense economically. Now, companies can implement technology that will analyze a vehicle’s age, mileage, maintenance history, total downtime, availability of rental replacements and how integral the vehicle is to the operation of the company to create a ranking system. By customizing this analysis to sync with your fleet’s priorities and your broader business goals, it completely takes the guesswork out of when to replace a vehicle.
For those who aren’t as technically savvy, stepping into the world of Big Data can be intimidating. But the financial benefits that can come from closely monitoring your fleet and then taking corrective action can result in a tremendous cost savings that enables your company to invest in other parts of your business.
To read the entire article, visit Food & Drink Magazine.