How Fleet Management Software Can Decrease The Cost For Fleet Operators
Private fleet operators are nowadays under a lot of pressure to cut costs. At the same time an acute shortage of experienced drivers has put a dent in the balance sheet of private fleet operators. Companies are a lot of times understaffed. Because of this, managers are being compelled to pay enormous amounts to qualified drivers. Add increasing fuel prices and escalating maintenance costs to the problem, and it's easy to see why it's so important to procure fleet management software.
Executives recognize that something has to be done to manage transportation costs. For companies which operate in high volume delivery environments, the key definitely is fleet management. Most particularly, these companies must consider spending on an integrated management system.
Good investments are always worth it as they will pay for themselves in due time. With this software, payback can come very quickly. Think of a classic scenario for a distributor with thirty trucks. On normal days, all vehicles are used, each one of them making almost eighteen stops a day, and covering hundred miles. Standard fuel utilization is about seven miles per gallon. Truck drivers are given fifteen dollars an hour, plus extra in case of overtime. On a given day, one-third of the trips are for eight hours.
With diesel becoming more expensive, this distributor has to spend thousands of dollars per week on fuel. A very easily attainable decrease in mileage can result in a saving of hundreds of dollars a week. This may work out to more than thirty to forty thousand dollars an year. Eradicating two hours of overtime for at least ten drivers leads to saving about a couple of thousand dollars per week. That's another eighty thousand per year.
A saving of more than a hundred thousand dollars an year is pretty substantial, and must be enough to necessitate investing in fleet management software. Such software by keeping a track of everything you spend on will help you come up with innovative ways to cut costs, without having to resort to anything drastic. There are more sophisticated management systems which go a notch higher, taking the commercial vehicles off the road. In several cases, an entirely optimized plan necessitates fewer trucks, on some days at least. Simply dropping fleet requirement saves a lot of money. And this saving can go more than a hundred thousand dollars an year.
If drivers tend to leave the engine on to stay warn during winters and cool during summers, the operators are forced to foot the bill. Diesel engines use about a gallon of fuel every hour even during inactivity. Once companies start using a sophisticated fleet management system they will realize that most drivers leave the engines running idly for at least two hours a day. In the distributor scenario, this would cost almost fifty thousand dollars per year, which is unnecessary loss that can easily be prevented by the company. Additional rewards of a GPS fleet management system can include reports which show incidents of harsh breaking and speeding. This information can assist fleet operators decrease risk and reduce insurance rates.
Given the pressure fleet operators are under, using fleet management software makes for a good financial decision. These applications tend to open up chances to considerably reduce personnel costs and transportation. They also have the ability to enhance a company's risk profile. Payback usually occurs in six months. And with the help of the right options for payment, fleet management can help improve cash flow.
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