Fleet News

In the spotlight: IFC Fleet Services

IFC Fleet Services has enjoyed success by tapping into a growing trend in outsourcing while also dealing with end-user fleets.
Now the fleet management company, which also incorporates mileage management business Vertivia and BBS Fleet Logistics, is eyeing further growth.

IFC was launched by Paul Talbot in 2001 and initially provided outsourced fleet services.
During the past 13 years it has continually analysed the market and developed into a business that employs more than 60 people across three distinct operations.

IFC acquired Bedford-based BBS Fleet Logistics in 2004 and launched Vertivia in 2008. Talbot, together with sales director Paul Chater, technical director Paul Miers and BBS managing director Colin Cripps, decide and manage the strategy for all three businesses, while the day-to-day management is handled by individual management teams.

“That allows us to get on with the big picture stuff,” says Talbot.

It’s a management style which has clearly worked, with the company’s combined operations now managing more than 15,000 drivers.

Chater says: “The common thread across our customer base is that some aspect of the fleet is being looked after by somebody for whom it’s not their core role and they’ve recognised it may not be run as efficiently as it could be.

“We try and bring a sense of order and process, and good customer service to enable businesses to focus on their core operations.”

It’s an approach which has put the business on course for further growth.

Chater explains: “We’re looking to acquire a complementary business during the course of this year. We see acquisition as being the next logical step.

“We’ll maintain the organic growth strategy, but we feel an acquisition is a good way of moving the business forward.”

IFC was tight-lipped about exactly what type of business that may be, but Chater told Fleet News it would be a provider of fleet services.

With one acquisition already under its belt, the senior management team is confident of further integrating another business into its portfolio.
BBS Fleet Logistics, for example, has changed since it was acquired by IFC. Chater says: “We’ve gradually shifted the emphasis from crash repairs, which we still continue to do, to in-life storage and logistics.”

Today, BBS Fleet Logistics works with some of the UK’s largest leasing companies and end-user fleets.

Chater continues: “Recognising it was a fairly mature market for pre-delivery and disposal management, we saw a gap in the middle for managing driver change.

“When an employee moves or leaves the business, companies don’t have anywhere to put that vehicle so we collect it, we refurbish it to a reasonable standard and then we hold it until it’s ready for reallocation to a new driver.”

It’s been a resounding success and now accounts for 80% of the company’s business, rising from 20% a few years ago.

IFC has made a habit of identifying a gap in the market and developing its services accordingly. In 2008, it recognised an opportunity while working with the Energy Saving Trust.

“The fleets we were seeing were dealing with the acquisition of vehicles, the funding and the renewal cycle,” says Chater. “Some of them were using wholelife costs, some of them weren’t, but gradually there was a good knowledge, within the prospect and customer database, about everything other than what the drivers were doing on the road.”

Many fleets didn’t know how they were using fuel, how many business miles they were doing and what their split was between business and private mileage.  

Working with the Energy Saving Trust, IFC helped fleets cut carbon emissions and recognised that this lack of knowledge provided an opportunity.

“We saw an opening and started building a product,” says Chater. However, that wasn’t easy. “There’s a huge level of complexity in multiple drivers, multiple cars, multiple reimbursements and fuelcards,” he says.

Nevertheless, a year later it had built a product that was introduced to its customer base. Vertivia became a business in its own right and it now has several thousand users.
Chater says: “We see a lot of customers coming to us wanting to reduce their costs, which is understandable in the current climate. But we also see customers who want to ensure greater compliance with HMRC guidelines.”
Cost and compliance are the main drivers, but Chater says there are also a number of fleets where their priority is to reduce their carbon footprint.
Vertivia essentially provides fleets with online journey and mileage management systems, while it manages all the data behind the scenes to produce a payroll file according to their reimbursement rates.
Chater says: “We see a lot of customers using an ‘at-cost’ mileage reimbursement rate method, but there’s a little bit of mystery around that from a driver’s perspective, so we demystify all that by saying ‘this is how it’s calculated, this is how much you spent on fuel, this is how many miles you’ve driven and therefore this is the reason for the deduction’.”
Vertivia customers can ‘conservatively’ expect a fuel saving of 10-15%, but Chater says: “To actually quantify the exact saving per customer is very hard. Even when the system has been established, there are additional savings that come through as a result of best practice.
“For instance, with fuel at cost reimbursement, drivers can see the impact of their driving style on their deductions and they start to add the two together and adapt their driving style, benefiting everybody.”
Miers continues: “If we look at month one versus month 12, we’ve also seen the percentage of private mileage of total mileage increase for every single one of our clients.
“You could say it implies the drivers have been under-reporting private mileage or their business mileage has not been very accurate.”
Analysis of the data has thrown up some interesting trends, including a growing gap between official combined fuel economy and what is achieved in the real world.
Miers says: “We’ve seen that as the car’s published combined economy increases, the ability for the driver to get close to that decreases.”
Vertivia’s customer base, like those of IFC and BBS Fleet Logistics, consists of fleets it manages directly, while other companies have access to a white label version through their leasing partner or third-party provider.

While many fleets may not have heard of IFC, Vertivia or BBS Fleet Logistics, a large proportion may have unknowingly used their services.
The white labelling of products is commonplace across the fleet industry and by working with leasing companies keen to provide a ready-made service as part of their suite of products, all three businesses have enjoyed success.

Chater says: “We’ve seen a lot of growth through those partnership arrangements.”

Talbot adds: “White labelling is an important part of the business strategy and we would always look for those opportunities. I think our strength is that we’re independent and we’re established in the marketplace.”

Running such a systems-based organisation, IFC has also recognised the importance of developing its IT capabilities.

All of its software development is written in-house. “None of it is provided by a third party, so whether it’s Vertivia software, IFC fleet management or BBS Logistics, it’s all our software which is a key part to providing a personalised service,” says Talbot.

“It’s also crucial to providing a white label offering and, when you’re a smaller company, ensuring you’ve got something different to offer.”
That software development capability has, according to Talbot, played a pivotal role in the company’s success.

“We can spot a change in the market and respond to it,” he says.

“But if a client is saying ‘we really need it to work this way’, we will look at making the changes necessary.

“It enables us to provide our customers with something that is very much their product and their offering, which is very important to them and very important to us.”

IFC also recognises career development as key, offering apprenticeships and graduate training opportunities across the three businesses.

Talbot says: “We’re one of those companies that probably goes under people’s radar in terms of our size, our capability and knowledge. From that perspective, we’ve tried to invest back into the local community and provide opportunities like apprenticeships.”         

It helps to raise the company’s profile, but it’s also about regenerating the business with people coming through with new ideas.
Talbot adds: “It’s the people that set us apart from the rest.”       
  

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