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When it comes to fleet management, productivity isn’t something that’s usually discussed. Typically, it’s all about dollars and cents. However, the irony of this is that productivity directly impacts profitability. So if you’re serious about bolstering the bottom line, it starts with being efficient. Here are several effective tips:
Conduct Regular Vehicle Inspections
If you aren’t already conducting regular (scheduled) fleet checkups, start today. Regular vehicle inspections can mean the difference between simple maintenance repairs and expensive problems that drive up your costs and destroy your bottom line.
Aside from the raw financials of vehicle inspections, staying on top of repairs allows you to keep your vehicles operational and on the road. And because you’ll have fewer breakdowns, you won’t have to deal with having vehicles unexpectedly sitting in the shop and creating logistical bottlenecks.
Onboard Fleet Maintenance Software
Mastering vehicle inspections starts with using the right fleet maintenance software. With good software in place, you can automate most of the scheduling and create a systematic and organized approach that removes all guesswork from inspections and maintenance.
Fleet maintenance software is built to enhance ROI by providing preventive maintenance scheduling, digitized work orders, shift scheduling, labor benchmarks, codified repair cataloging, audit trails, warranty capture, and advanced data and analytics reporting.
Create a Fuel Program
Having a vehicle fuel program can be a total game changer for your fleet. There are countless ways to design fuel programs, but here’s one idea:
Assign each fleet driver a company card to use for fuel purchases for his or her vehicle.
Collect data on how much fuel each driver uses per month.
Set reasonable thresholds for each driver and incentivize for coming in under them.
Without a fuel program, drivers don’t typically feel the pressure to manage fuel consumption. It might be in the back of their minds, but it isn’t a priority. But when they have some skin in the game, it suddenly becomes a focal point.
Incentivize Smart Driving Behaviors
Having a fuel program is one thing. But raw incentives aren’t always enough to get people to take action. You also have to show your drivers
how to drive smarter. In other words, tell them where they can improve.
Department of Energy research indicates there are three extremely important factors in fuel efficiency: braking, acceleration, and speed. In fact, rapid braking, fast acceleration, and speeding are shown to reduce a vehicle’s fuel efficiency by a significant 15 to 30 percent at highway speeds and roughly 10 to 40 percent in city traffic. This results in an effective cost of $0.25 to $1 per gallon of gasoline. For a fleet covering 500 miles per day, this could amount to as much as $10,000 or more per month.
Keeping these factors in mind, you can incentivize smarter driving behaviors, improve productivity, and directly lower costs.
In addition to incentivizing, you can architect better driver training programs around these concepts. It might seem elementary, but teaching drivers how to properly accelerate or brake in different scenarios can be a game-changer.
Optimize Fleet Routes
When was the last time you reevaluated your fleet’s routes? We recommend taking a look at your primary routes every six months and accounting for stops, turns, traffic patterns, and fuel efficiency. This may pave the way for new route opportunities that are more efficient.
Know When to Dispose and Replace
Vehicle maintenance is only one aspect of managing a productive fleet. You also need a replacement program. In fact, properly cycling out your vehicles once they’ve reached a certain point is one of the most important things you can do in terms of keeping overall costs low.
Older vehicles pose a few significant problems. First off, they depreciate much faster than newer vehicles that are in decent condition. In some cases, older vehicles can depreciate as rapidly as $6 per day (which is $180 per month). Continuing to hold a vehicle means you’ll recoup less value at trade-in. Secondly, older vehicles require more maintenance. This drives up holding costs and puts you at risk of not having enough operational vehicles to maintain all routes. And, finally, older vehicles are less safe. If you aren’t careful, they can put your drivers at risk.
If you’re good about collecting and analyzing data, you can figure out precisely when vehicles should be disposed of/replaced for maximum ROI. It’ll take some trial and error, but you’ll eventually be able to attach some numbers to it.
Putting it All Together
Productivity is the key to profitability. If you want your bottom line to be as strong as possible, it all starts with maximizing productivity at a foundational level. This article is intended to provide you with a sound starting point for enhancing productivity so that you can pave the way for even beefier ROI. But in order for this newfound knowledge to benefit you and your business, you must be a grade-A action taker – a master of implementation. That means taking at least one thing that you learned in this article and working toward doing it this week. Because when you take action, knowledge gets converted into value. That’s where real progress is made!