Company car fleet management has evolved significantly in recent years, thanks in large part to changes in fleet regulations, advances in vehicle and office technology, and expanding business needs.
This has left many fleets “behind the 8-ball,” so to speak, and scrambling to control the rising costs of fuel, maintenance, and vehicle acquisition (just to name a few).
In this article, we discuss best practices that can help you make your fleet management program the best it can be.
Company Car Fleet Management Best Practices
Conduct A Fleet Analysis
A fleet analysis typically consists of two key performance indicators (or KPIs):
- Total cost of ownership
- Vehicle cost per mile
Together, these data points can tell you what it costs your business to keep a vehicle (or your entire fleet) on the road.
Total Cost Of Ownership
The best way to calculate Total Cost of Ownership is with fleet management data gathered from core technology such as fleet management software, telematics, and smart fuel-card software.
With that data in hand, you can use it in the following formula:
Total Cost of Ownership = Fixed Vehicle Costs + Variable Vehicle Costs
Fixed vehicle costs include things like lease payments, insurance, and permits. Variable vehicle costs include fuel, tolls, maintenance, and repairs.
Once you’ve calculated the TCO for a single vehicle, you can examine the data points included in the calculation and come up with new ways to use fleet management software, telematics, and fuel card software to reduce both fixed and variable costs.
For example, you may choose to implement an open-loop fuel card so drivers don’t have to travel extra miles off the optimal path (and use more fuel in the process) to fill their tanks.
Vehicle Cost Per Mile
With the total cost of ownership in hand, you can now determine your vehicle cost per mile using the following formula:
Vehicle Cost Per Mile = Total Cost Of Ownership / Total Miles Driven
As with the total cost of ownership variable, you can use the core technology mentioned earlier to pull data that can help you reduce vehicle cost per mile overall.
For example, you can use your GPS and fuel card data to reduce total miles driven and even find lower fuel prices so that both total cost of ownership and vehicle cost per mile go down.
Take Advantage Of Real-Time Tracking Tools
Companies using real-time tracking tools — including fleet management software, telematics, and smart fuel-card software — saw an average return on investment (ROI) of 300%.
Even half of that is a good ROI when you think about the many other ways that this technology can help streamline how your fleet operates. With the right components in your tech stack, you’ll be able to track vehicle location, monitor speed, and check driver behavior as it’s happening.
And if you’re not able to watch it with your own eyes, tracking tools can record the data so you can review it later. That data can help you identify potential safety hazards, fuel inefficiencies, fuel theft, and unauthorized vehicle usage.
Integrate Fleet Management Software With Other Systems
Most fleets start with a combination of fleet management software, telematics, and smart fuel-card software to coordinate the various activities of their vehicles.
But that doesn’t mean that’s all the software you’ll need. Nor does it mean you want to limit yourself to just those three options.
A robust company car fleet management program should integrate with other systems that you’re already using (or that you will use in the future).
For example, the Coast smart fuel card integrates with telematics services such as Samsara, Verizon Connect, Lytx, Azuga, Geotab, and others. Similarly, it also integrates with Fleetio fleet management software and Intuit Quickbooks accounting software.
With all of your tech stack working together, you’ll be better positioned to achieve a 360-degree view of your fleet activities and gain insight into ways that you can cut costs and make the entire operation work better.
Create Fuel Policies
Fuel policies are an important part of successful company car fleet management.
Whether your employees are driving cars, work trucks, vans, semis, or even construction equipment, if they don’t have some rules to operate under, they’re probably just going to fill the tank and won’t think about what’s best for the business.
The fuel policies you put in place should include things like:
- When and where to fill up
- How to pay for fuel
- Spending limits
- Necessary reporting
The best way to administer and maintain your company fuel policies is with a smart fuel card. These cards do more than just give your drivers the ability to pay for fuel. They also help you monitor fuel consumption and prevent fuel theft.
The control that these cards provide — in addition to the policies you have in place — can mean the difference between operating in the red and operating in the black.
Equip Vehicles With Advanced Safety Features
To keep your drivers and vehicles safe on the road, install advanced driver assistance systems, such as adaptive cruise control, lane departure warning, blind-spot monitoring, driver drowsiness detection, cross-traffic alert systems, and automatic emergency braking.
Not only do these tools help drivers operate their vehicles safely, but in some cases, they can also help conserve fuel.
Adaptive cruise control is a prime example. Using this feature on long, uninterrupted stretches of highway keeps the engine running at a consistent RPM, which, in turn, helps the vehicle use less fuel.
Without that feature, it’s more likely for drivers to constantly accelerate and decelerate — and, therefore, use more fuel — in order to keep their vehicles at a consistent speed.
Build A Driver Scoring Program
Employers across the U.S. incur costs of more than $60 billion each year due to vehicle accidents. This highlights the importance of making safety a priority in your fleet.
One of the best ways to do that is to build a driver scoring program into your drivers’ workflow.
Use the data analytics from fleet management software, telematics, and smart fuel-card software to give your driver a grade (or a score) based on driving behaviors such as:
- Speeding
- Harsh braking and heavy acceleration
- Excessive idling
- Inconsistent speed
Providing feedback in addition to the driver’s score can incentivize safe driving practices, improve driving techniques, and reduce expenses like fuel consumption and insurance premiums.
Train Drivers In Fuel-Efficient Driving Techniques
Driver scoring doesn’t mean much if you aren’t consistently working to improve those scores.
If you notice poor driving habits occurring more and more regularly, don’t turn a blind eye and hope that they go away. Implement a driver coaching program to address existing and potential issues.
Within that program, train your drivers to replace their bad driving habits with fuel-efficient driving techniques that save fuel and help them stay safe on the road.
Schedule Preventative Maintenance
Preventative maintenance provides a long list of benefits to your company car fleet management program. For one thing, it improves vehicle reliability so you can maximize availability to get the most out of your vehicles as possible.
Regular maintenance also extends the vehicle service life by preventing small problems that can become big (expensive) problems.
Preventative maintenance typically involves three unique variables:
- Pre-trip inspections
- Post-trip inspections
- Customized checklists for each vehicle
With preventative maintenance in place, you’ll be able to keep your vehicles on the road longer, realize fewer disruptions to the workflow, maintain schedules and timely deliveries, and keep your customers satisfied at all times.
Consider Adding Electric Vehicles To Your Fleet
As battery technology continues to evolve, many fleets have chosen to start replacing their gas and diesel vehicles with electric vehicles (EVs). It’s worth investigating if electric vehicles might improve the environmental impact of your fleet and the cost-effectiveness of its daily activities.
While EVs might not be beneficial for all fleets right now — long-haul trucking companies come to mind — businesses that operate in a smaller geographic area might benefit from transitioning into electric vehicles.
Consider replacing an aging gas or diesel vehicle with an EV to see if the range and hauling ability work for your business.
Improve Car Fleet Management With Coast
Taking on the challenge of optimizing your car fleet management may seem daunting, but the rewards are well worth the effort. If you’re just getting started, a smart fuel card system is an effective, low-cost way to set spending rules and collect fleet and fuel data.
With Coast, fleet managers and admin get access to:
- Advanced spending controls
- Tracking and reporting
- Integrations with telematics and fleet management software
The Coast card even provides real-time expense tracking and a powerful online management platform that gives you full visibility of every dollar spent.
Erin Hutson, owner of Saint Louis-based JED Transportation, used the advanced spending controls and comprehensive reporting features to gain unparalleled transparency and insights into the business’s fuel expenses.
That meant that she could track and analyze spending patterns, identify areas for optimization, and make data-driven decisions quickly and easily.
“After switching to Coast,” Erin says, “our level of confidence really went up because there are real-time controls that we have in place.”
By incorporating these features into all of their daily operations, JED Transportation aims to minimize expenses, enhance driver satisfaction, and find new ways to conserve fuel throughout their fleet.
To learn more about how Coast can help improve your car fleet management, visit CoastPay.com.
