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Expert Tips on How to Reduce Fleet Costs

Expert Tips on How to Reduce Fleet Costs

Yes, change is difficult. However, it is also necessary. As a fleet grows, it also needs to evolve. Fleet monitoring helps companies reduce fleet costs, increase team productivity and enforce better workplace policies. Investing in a high quality fleet management system ensures companies stay profitable and competitive, during good times and bad. Is Logifleet a good fit for your needs? Speak with one of our team members today to find out! Learn more about how Logifleet can improve your fleet management processes here.

1. Install a fleet monitoring system

You can’t fix what you don’t know. It’s difficult - sometimes impossible - to make decisions without all the facts. Flawed memories, rough estimates or verbal accounts are not reliable sources of information.

The best way to collect trip data and analytics is by using a fleet monitoring system. This data doesn’t lie. It’s automatically transmitted and stored. Managers can access it at any time through a web or mobile app. Super convenient, right?

Installing a fleet monitoring system is one of the easiest ways to quickly reduce fleet costs. This valuable tool helps with the following six tips as well.

 

2. Do regular vehicle maintenance

All vehicles benefit from regular maintenance - fleet vehicles are no exception. When you rely on these vehicles for business, it’s even more important to take care of them. Well-maintained vehicles and equipment are less prone to roadside breakdowns, accidents and on-site hazards. These problems can be both costly and dangerous.

Here are some quick tips on how to keep your fleet in top shape:

  • Check the tire pressure often. When tire pressure drops, so does fuel efficiency! Keeping tires properly inflated could increase mileage by up to 3%. Also keep in mind cold weather drops tire pressure while hot weather increases it.
  • Consider hiring an in-house mechanic to do repairs and maintenance. (Did you know: 38% of surveyed fleets performed repairs and maintenance in-house? Source: Government Fleet Research) You can also reduce vendor costs by negotiating better rates or considering new vendors.
  • Check vehicle alignment and keep engines properly tuned. Improper alignment is not only uncomfortable for the driver, it also causes uneven wear on the tires and reduces fuel efficiency. Keeping engines tuned also increases fuel efficiency.
  • Retread tires. Tires are very expensive. Next time one wears out, consider retreading to increase tire mileage instead of buying brand new tires. Retreading is a cost-effective measure that doesn’t sacrifice safety or performance. 
  • Rotate assignments. This prevents vehicle and equipment overuse and reduces wear and tear, especially on expensive assets.
  • Check the brakes and air filters. Brake drag and even dirty air filters reduce fuel economy!

Learn how Logifleet can help your fleet stay on top of regular maintenance here.

 

3. Reduce your fleet size

According to a 2018 Government Fleet Research study, 44% of survey respondents cited “aged fleet/replacement budgeting” as a top concern.

Cutting down fleet size can save thousands of CHF per vehicle. While the process can be complicated and sometimes stressful, it is also a guaranteed way to reduce operational costs.

Here’s a quick checklist to help you determine whether you should trim your fleet (Source: Government Fleet).

  • Is this vehicle or piece of equipment critical to operations (even if it’s rarely used)? 
  • Is the size of your fleet (including equipment) proportionate to the number of personnel who use it?
  • Can multiple departments share the same asset instead of each owning one (i.e. carpooling)?
  • Consider car-share contracts instead of leasing or purchasing new vehicles.
  • Reduce “fleet creep” by tracking and eliminating unnecessary or underused assets with fleet monitoring.

 

4. Curb bad driving behavior with better staff training

Driver compensation is one of the biggest costs in fleet management. It’s also increasing each year as companies struggle to recruit and retain top drivers. Between salaries, bonuses and other benefits, companies are spending a lot of money. There’s also a constant shortage of candidates, which increases time to fill for positions and impacts company productivity. 

So one of the best ways to reduce fleet costs is to hire better drivers and train them well.

Bad driving behavior such as harsh braking, excess idling and speeding spikes fuel costs. It can also lower mileage by up to 40%. This in turn increases vehicle wear and tear. 

Road rage and aggression could lead to costly accidents and increased insurance premiums. Irresponsible drivers also rack up fines and legal fees, increasing liabilities.

Idling burns fuel and increases vehicle wear and tear. In many situations, it’s also illegal. By ensuring large vehicles or heavy machinery don’t idle for lengthy periods of time, you’ll reduce costs and cut down air pollution as well.

All of these concerns are just some reasons why companies need to implement training programs and better debriefing sessions. A single bad driver could add tens of thousands of CHF to your annual operating costs.

Fleet monitoring systems can keep drivers accountable and provide the data managers need to train better employees.

 

5. Increase staff productivity with telematics

Unlike staff who work in an office, workers are always on location or on the go. This makes it very difficult for even the best managers to evaluate work performance. Worse, it’s distracting to constantly call drivers when they’re on the road. 

The best solution to increase staff productivity and communications is introducing fleet monitoring. Telematics can cut trip times by up to 68%, according to a study by Mordor Intelligence. This in turn leads to reduced fuel costs and a lower carbon footprint.

With fleet management software, depot managers can see real-time or historical trip data at their convenience. This is a long-term solution that helps them better manage assignments, schedules and their team. By increasing productivity, you’ll see savings across the board - from fuel to wage costs.

 

6. Reduce trip times with route optimization

Smart route optimization software helps fleet managers improve many processes, from planning and dispatch to delivery and proof of service.

This means you can always assign the closest and best asset for the job (reducing under-utilization).

Or complete trips faster by taking shorter routes with less congestion. This means no more wasted or extra trips.

Route optimization reduces fuel costs, and in many cases, wage costs as well. Drivers get jobs done faster, and customers are happier, too. It also keeps drivers accountable, so they’re less likely to use commercial vehicles for personal reasons.

Best of all, route optimization is already included in most fleet management software. Learn about route optimization with Logifleet here.

 

7. Consider alternate fuels or electric vehicles

Alternative-fuel or electric vehicles can be more expensive to purchase upfront, but the fuel is much cheaper than gasoline. These vehicles have less emissions, require less maintenance and don’t require oil changes or engine upkeep (Source: ILG). 

With fleet management, you can assess the total cost of ownership for each alternative fuel or electric vehicle to see if it’s a viable choice for your business and its unique needs.

 

In Conclusion

Fleet costs are always on the rise. Luckily, there are many ways to reduce fleet costs, especially with the help of fleet management software. Software like Logifleet empowers fleet managers to make better decisions. Preventing skyrocketing fleet costs is no longer rocket science! Learn more about how Logifleet can help you reduce fleet costs today.

Raphaël Greppin

Raphaël Greppin

Founder and director of LogiFleet SA since 2002, I take care of the company acquisition and projects management.

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