Fleet News

Businesses encouraged to look beyond the pump to address factors they can control

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According to Navman Wireless: “Businesses should look to identify and rectify inefficiencies that exist regardless of fluctuations in fuel prices and other factors outside their influence, keeping profits high and risks low by taking responsibility for the costs that are under their control. “

The commercial fleet sector’s narrow margins and obvious reliance on fuel make it particularly susceptible to fuel prices beyond its influence. However, this should not distract from addressing the costs that are under its control, says Steve Blackburn, European Vice-President, Navman Wireless.

“There is a hidden factor. One that is much closer to home than the fluctuation of crude oil on the international markets and closer still than the local pump. General business inefficiency and poor driver behaviour are the great ‘grey’ areas of commercial fleet costs. They do not show up each month in stark black and white, as do commodities like fuel and equipment. They do not grab the headlines.

Enhancing fleet management is essential to minimise waste, maximise productivity and strengthen customer relationships. By doing this businesses can secure long term gains and strengthen their position irrespective of external factors.”

Businesses across the UK are spending hundreds of millions of pounds more on fuel than they were a year ago, and with escalating tensions in Iran pushing oil past $100 per barrel again, and with a 3p per litre increase in fuel prices still set for August, businesses across the UK can expect to pay tens of millions of pounds more per day on fuel.

Consequently, rising fuel costs, should remain high on fleet managers list of concerns. Regardless of what the Government does, high fuel prices are here to stay and will continue to eat into business profit margins.

While vehicle fuel efficiency may have improved steadily over the last few decades, both the economy and international oil markets are now undoing the gains made. Strains on crude oil supply, caused by demand from rapidly growing economies in Asia, the Far East and South America, are expected to keep increasing fuel prices in the long-term. Meanwhile, fuel duty remains consistently high, offering little respite to businesses that must endure the price hikes caused by market speculation.

Unfortunately, traditional cost cutting strategies are becoming less effective. Shopping around for fuel is not sufficient to absorb price increases. Fuel efficiency improvements of the combustion engine are slowing and hybrid and electric technology for commercial fleets is rare and prohibitively expensive. Depreciation further limits options.

Thankfully, business management solutions continue to improve, delivering a range of efficiencies regardless of external forces and offering a vital edge in competitive market places.

Vehicle tracking enables users to monitor and manage fleets in real time, identify the nearest available vehicles for jobs, and to quickly and smartly adapt to changing road conditions and customer demands – as well as numerous other benefits, such as cutting unauthorized vehicle use, reducing idling and limiting excessive speed.

Telematics tools, such as CANbus engine management, can perform a variety of functions, including; identification of over revving, excessive acceleration, breaking and other key indicators of less than optimal driver performance – revealing the gap between good and bad driving that narrows profit margins.

Leading providers offer a service that goes ‘beyond the box’, and continually seek to help fleets strengthen customer relationships and cut costs throughout their business.

Furthermore, there are many other technologies, such as customer relationship management software and routing and scheduling software, that offer broad and bespoke benefits to business and demonstrate return on investment in tough times.

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