Fleet chiefs advise being flexible and always keeping your eyes and ears open to ways of performing tasks better. Sarah Tooze reports.
How confident are you that you have the right supply chain and the right manufacturers on your company car choice list?
Do you have a leasing or fleet management company that can guide you through the myriad changes happening in the market from company car tax to WLTP (Worldwide harmonised Light vehicle Test Procedure) and clean air zones?
Are you getting the maximum value from your suppliers? Are they helping you to reduce fleet costs?
Do your manufacturers offer the right products now and in the future? Will they help you to lower the emissions of your fleet and meet employee demand?
Do you know what else is available in the market?
These are all questions you need to consider if you are to run an efficient fleet.
David Oliver, procurement manager at Red Bull, who is a responsible for a fleet of 218 vehicles, regularly reviews the marketplace and isn’t afraid to change suppliers.
“We tend to have a rolling review of everything,” Oliver says. “We know the world is changing so we need things to be agile.
"We’ll be honest and if there is a feeling that something isn’t fit for purpose or someone has come along with something better then it’s not a case of saying we need to wait 18 months before we can do something.
“It’s a tightrope to walk in terms of the flexibility we want and the longevity that they want but we manage it.”
Attending fleet events helps Oliver to assess what products and services are available.
He realised at Fleet Management Live (now Fleet Live) in 2016 that another licence checking provider offered Red Bull “a far quicker and simpler solution” and decided there and then to change.
“It is a case of what’s out there in the market. Is it better than what we do? Yes, let’s move,” he says.
Similarly, in 2015 he decided to appoint a new fleet management company to reduce the administrative burden.
“I’m not a dedicated fleet manager, I’ve got other responsibilities, so I needed a trusted partner that would pick up the reins and be my professional advisor as well as my administrative assistant, allowing the drivers to contact them first, not me,” he says.
Red Bull buys its vehicles so around half of the 26-to-30 suppliers Oliver works with on a regular basis are vehicle manufacturers and dealers.
Position of driver
His starting point when reviewing manufacturers is always the driver position.
“With job-need it’s about the best car at the lowest cost per month for tax and the best car for the organisation to own and run as well,” he says.
Oliver uses wholelife cost software to compare vehicles and takes into account fuel economy, safety and whether the manufacturer’s brand image fits with that of Red Bull.
“We have a massive wish list of things and it’s how many you can satisfy,” he says. “Some manufacturers generally satisfy more than others, so there are a few safe choices but, equally, we like to shake it up now and then.”
Red Bull recently added Seat to its choice list because “it was a brand we had ignored for too long and it could offer something quite compelling, especially from a P11D perspective compared to our traditional approach of Audi, BMW and VW”, Oliver says.
Lorna McAtear, head of supply and internal accounts at Royal Mail, keeps an open mind about vehicle manufacturers.
“You still have to keep the relationships with those that aren’t necessarily providing you today because they may tomorrow,” she says.
Like Oliver, she believes it is worth doing “a continuous review” of the market.
“You have to always see what’s out there even if you’ve got a contract,” she says.
“You may get to the end of that and decide you’ve still got the best thing so you’ll just extend or you may get to the end and think ‘no, I’ve got to change because we’re changing direction’.
“It’s not always about the supplier and its performance because it could still be performing brilliantly, it just doesn’t suit your business model any more.”
Royal Mail recently unbundled a number of services, including hire, breakdown and recovery, and glass because “it fitted our change of direction”, McAtear says.
“We could achieve more by going direct,” she says.
She believes it is good for fleets to audit and assess their supplier relationships because “familiarity” can creep in.
“You’ll get used to doing things a certain way and forget other things are there or could be done. So, it’s always good to just have those conversations,” she says.
“You may both quite happily be plodding along in one direction but discover that actually the market has shifted and over here everybody is doing some-thing slightly different so is that better for you or not?”
For Stewart Lightbody, head of fleet services at Anglian Water, the level of driver “noise” is the best indicator of whether a supplier relationship is working or not.
“If things aren’t going right we’ll know really quickly; nothing is as emotive as a company car,” he says.
Anglian Water is about to tender for a leasing provider having decided to switch from outright purchasing its cars from two manufacturers (Vauxhall and Mitsubishi) to giving drivers a huge choice list.
The new policy will allow ultra-low emission vehicles and pure electric vehicles onto the choice list and give drivers flexibility to have the car they want.
Anglian Water opened up the choice list for its 50-60 senior managers last year as a ‘proof of concept’ and found 45% of drivers opted for a sub-50g/km plug-in hybrid.
The change of direction has meant Anglian Water will need to adopt the leasing model as the fleet team don’t have the experience or systems to handle enquires from 700 drivers.
“Once we open that door it will encourage a whole new world of questions,” Lightbody says. “I need a leasing company to help the driver navigate their way round all this new choice and to be almost an extension of my team.”
What to do if a supplier is falling short:
David Oliver says: “Firstly, be honest and say ‘how much of it is them and how much of it is you?’
"Have you communicated with them? Have you shared your plans and strategy? Have you kept them at arm’s length?”
Find out why there are problems
“I’m fairly optimistic and I always like to think nobody fails deliberately,” Lorna McAtear says. “If they’re always late in delivering you’ve got to understand why and it could be that something has changed in the supply chain for them.
“Actually, is that a huge stumbling block for me? If I change a process here then we can work together. So, it’s trying to come up with a mutual solution to get you both on track.”
But the supplier may have over-promised in the original contract to win the bid. If so, go straight to step five.
Consider changing account managers
Stewart Lightbody says: “It could be something as simple as a different personality would change the dynamic and make it work. I’ve done that a couple of times.
"It’s not easy to do but if they’re not helping you and you’re not achieving what you want to achieve then, really, you have to have that conversation.”
Set a deadline
“Consider a fixed-term improvement programme for the incumbent supplier,” says Oliver. “We’ve done that a few times. We’ve said ‘look, everyone knows this isn’t as good as it can be, how about we give it three months around these key set measures and, if you can prove you can meet them, then we’ll stay with you’.
"Then you review and if they maintain that then you’ve probably saved yourself an unnecessary tender.”
“If none of these measures seems to be working then you’ve got to research the market place and have a plan to exit,” Oliver says.