If you own a small business that operates vehicles for commercial use, i.e. a cleaning company, a mobile salon, or a restaurant or any other business that delivers, you already know the pain of fleet management costs.
Whether you are a small business owner with two or more commercial vehicles, or you are a fleet manager in an enterprise that has fleet of 100+ vehicles, one of your prime concerns is fuel that the fleets runs on.
Fuel is a major cost for any company that runs a fleet and becoming fuel efficient can actually improve the overall profitability of the business. However, it is equally challenging and in fact it is the major concern for almost all small business fleet managers, to find out the ways with which they could do more to reduce fuel costs.
This article will guide you through the steps to reduce the fuel costs for your business and make your fleet more efficient, hence it contributes to the profitability of the business rather than draining the profits.
1- Track Fuel Purchases
Remember, that you can only fix the problems that you can track. An in order to save fuel you must track it first. Using fuel cards can be a great way to track fuel purchases in detail.
Normally, a fuel card shows the number of gallons filled, the odometer reading, the date and time, the total cost and the name of the driver who filled up the tank. Fuel cards have a lot more benefits other than just tracking the fuel purchases, read more.
2- Implement Digitization to Track Fuel Consumption
Tracking fuel consumption can be quite a laborious task if done manually, so the best way is to digitize the system. There are various software available in the market that can help you create an efficient logbook with real-time vehicle odometer.
Having control over this vital information, you can easily track fuel consumption and identify the problematic areas. Moreover, you can also monitor the driver’s behavior and how it impacts fuel consumption.
3- Reduce the Idle Time & Empty Miles
An average fleet vehicle burns around 1 to 3 litters of fuel on idling every hour, and if your fleet vehicle idles for about 3 to hours every day, there’s a lot of expense that is decreasing the profitability of your business.
Moreover, empty miles can contribute to big expenses, for instance, a truck makes a delivery but comes back empty; the trip back to the warehouse is just adding up the costs. These instance can be optimized easy through implementing proper plan, i.e. partnering with a provider to arrange backhaul opportunities or scheduling another pickup/delivery near the original delivery to avoid the empty miles.
You may not be noticing this as a problem if you have a couple of vehicles, but if your fleet is comprised of 10 vehicles and each of them has more than 2 hours of idling or empty miles, it can be a significantly big expense.
Reducing the idling time of vehicles doesn’t just saves fuel but will also help you reduce the maintenance costs.
4- Implement Driver’s Training & Reward Program
Having a written policy that clearly defines the expectations for drivers around fuel and set parameters for the overall best practices can drastically improve the performance of drivers and as of course as a result you save major fuel and vehicle maintenance costs. Make sure to communicate this policy to all your drivers on regular basis.
Conduct training sessions for drivers on monthly basis, but if it is not possible, there should be a quarterly session at least.
Give them achievable goals, measure their performance on regular basis and reward the top performer!
5- Have a Set Vehicle Maintenance Schedule in Place
A well maintained vehicle is more fuel efficient than the one that has issues with several parts. For instance, under-inflated tires and corroded battery cables can cause a vehicle to use more fuel.
There can be tens of other issues which require a regular checkup, i.e. the engine, battery, suspensions, etc. Having a set maintenance schedule and having a healthy vehicle can significantly save fuel costs.
6- Invest in Drivers’ Communication
Communication with your drivers can be challenging. As most of the time, they are on road and SMS, email, radio isn’t always the option.
Using a good software can streamline and simplify the process. In fact, there are tens of smartphone apps available to improve the communication with your drivers, provide them with the accurate maps and driving directions. As a result, drivers are least distracted, make deliveries on time, save fuel and time!
The Bottom Line:
Efficient fleet can greatly contribute to the profitability of your small business, however, it requires parallel efforts to maintain this efficiency. Digital transformation of your entire fleet management procedure is a great way to maintain efficiency in the long run.