Reduce Fleet Management Costs
June 14, 2023
Most successful companies are always striving to increase efficiency and reduce costs. For companies whose services include delivery, fleet management costs are a significant drain on profitability. How can businesses reduce fleet management costs and reliably deliver construction material and equipment? Curri, with its logistics software, can help companies lower their costs associated with fleet management and improve customer service.
Opportunities for Efficiency - The Types of Costs in Fleet Management
Fuel, insurance, maintenance, staffing – there are a host of costs involved with fleet management. The list doesn't even include the purchase costs of the vehicle(s). Construction material and equipment businesses need to ask themselves how they can improve efficiency related to fleet management.
One answer is running a lean operation. Extra vehicles drive up insurance and maintenance costs. Insufficient or wrong-sized vehicles reduce customer service and can impact fuel costs. Staffing levels are also tricky. By partnering with Curri, businesses always have the right-sized vehicle available to make a delivery.
Fleet Vehicle Purchasing and Leasing
Buying a new vehicle(s) for the fleet requires taking on a regular monthly expense, assuming a loan is taken for the purchase. Enterprise businesses need to update their fleet regularly. So, monthly costs will stay elevated. A significant outlay of cash is required if the vehicle(s) are paid for upfront. The money may be able to do more for the business if applied in other ways.
Leasing vehicles also means a regular monthly expense. The costs are fixed and can be a drag when business is slow. During busy times, having enough vehicles in the fleet to make a delivery would require a bloated fleet. An enterprise business may need dedicated staff to focus on purchasing and leasing vehicles.
Insurance Expenses and Liability Risk
You’ll want to keep your fleet up to date. Insurance for new vehicles is pricey and has been going up steadily. Plus, because the vehicles are used for distribution by various staff members, businesses would be wise to consider the highest liability insurance available. Accidents will happen – the only question is when. When an accident does occur, insurance rates tend to rise dramatically. Finding a new insurer is a time suck.
While insurance can provide peace of mind, it does nothing positive for the bottom line. This non-negotiable essential cost is a drag on capital.
Fleet Maintenance, Repair, and Fuel Expenses
To keep your fleet on the road as long as possible, regular upkeep is a must. Ignore fleet maintenance, and a business will pay in the long run. The costs to maintain and repair a fleet go beyond dollars and cents. If multiple vehicles are in the repair shop, distribution is impacted. An insufficient number of vehicles results in delayed delivery, or usage of wrong-sized vehicles.
Fleets require gas or electricity. Both forms of energy have a price tag. The prices (especially for fuel) can change dramatically from week to week. When vehicles are fueling up or charging, they are not making deliveries. Determining the ideal time to fuel up/charge can be a logistical headache.
Driver Staffing, Management, and Retention
Depending on the size of the fleet, construction material, and equipment businesses will have staff dedicated to driving. Managing driver staffing is challenging for those businesses that promise delivery within a limited number of hours. Who knows when a regular customer will need an emergency delivery? Or when a new client is giving the business a test run?
Whatever the delivery model/promise, finding and retaining sufficient staffing is a time-consuming task. Drivers are in demand and may job-hop to find what works best for them. When new drivers are hired, they need to be trained to deal with customers in a fashion that meets a business’ standards. Driver management is a full-time job.
Accidents, Fines, and Tickets
Fleet management means dealing with accidents, fines, and tickets. Again, these things are inevitable. The time and costs associated with these annoyances need to be considered. The only hope is to minimize these bumps in the road. Tracking the issues can help to reduce them in the long run. Staffing changes may be needed if drivers get into accidents or accruing fines and tickets at an unacceptable rate. This requires regularly updating a tracking system.
Curri’s Virtual Fleet Keeps Your Costs Down. Here’s How
The never-ending costs associated with fleet management can be minimized by working with Curri. Our virtual fleet keeps your costs down. There are three delivery options your construction material and equipment can select from rush, same day, and scheduled. Your business can partner with Curri or turn over the entire distribution process to us.
Whatever option you choose, you’ll have greater price certainty. This helps with business planning. With a smaller (or no) fleet, you can reduce the time dedicated to fleet management. Staff can perform tasks that suit them best, so they will be more productive.
Curri: Built for Enterprise, Distribution, and Construction
Curri can partner with construction material and equipment businesses of all sizes, including enterprise. Our nationwide network of drivers and vehicles can quickly deliver construction materials and equipment of all types.
Partner with Curri and let our expertise, technology, and knowledge within middle and final-mile logistics will help you take your business to the next level. Our end-to-end platform with help you with fleet management that will drive up your bottom line, grow sales, and cut waste. That’s what successful companies do.