In the constant daily struggle, fleet managers live and breathe to deliver the optimum performance at the minimum possible cost: peers operating in the same commercial sector might immediately think about the obvious sources of costs, such as fuel and vehicle purchases.
But after pause for reflection, or as well-seasoned operators in the sector probably already know, there are a lot of hidden expenses or factors that actually impact fleet costs but are not necessarily treated as “expensive” even though they might create situations that cause escalating costs or profit losses for any company dependent on drivers and driving.
Let’s have a look at areas you have to keep under control in order to reduce fleet costs or at least stop them from escalating!
#1 - Driver shortage
At the European level, driver shortage has been quite a worrying issue of late, partly due to an ageing workforce, but also because of changes in the economy and the profession leading to a lower number of available drivers. Shortage can have an influence upon the capacity of a business: by having access to only a restricted number of human resources, assignments cannot be handled properly and the business will undoubtedly suffer delays, which ultimately cause problems, or at the very least a decrease in the volume of achievable deliveries. This is why you have to look at driver hiring, retention and rewarding in order to keep costs under control.
#2 - Vehicle downtime
Downtime is also seen like a “tip-of-the-iceberg” problem, since the cost of a vehicle off the road for a breakdown or an issue is seen by the majority of people as “the cost of reparation”. But the truth is that there are quite a lot of hidden costs, such as the temporary replacement of the out-of-action vehicle during downtime, the cost of time spent reassigning jobs that were meant to be carried out with the vehicle in question, or the cost of the workforce who are forced to pause activity due to the unavailability of the vehicle... to mention just a few.
#3 - …coffee
This might sound odd, but we decided to add this item after a customer told us about the savings he had been able to make since introducing our technology. Apparently he realised his drivers were going to a particular fuel station that offered them free coffee if they filled the tank. But in order to do this, they had to drive an additional 8 km, which in the end resulted in the coffee not actually being “free”... it would have cost less money to the company to actually pay for the coffee or to have installed a machine.
Some of these points might sound strange or odd, probably the third one might have appeared quite bizarre, but actually if there is technology on board to monitor how your fleet is performing you can really get to grips with all sources of costs, and ascertain precisely where your money is being spent, so as to formulate an effective strategy to actively reduce fleet costs.