Leasing quotes – what’s the point in playing silly games?
SIR – I wish to respond to your article ‘Tendering – it’s time to get tough’ (Fleet NewsNet January 30).
Over the two pages the article covered I felt it gave balance, ending with top tips for finding the right funding provider. But I would like to address some specific points and comments.
I have worked in the contract hire industry for the last six years and have collected some observations during this time.
Your opening paragraph unfortunately sets the scene and tone for the first page of the article and the theme seems to resolve around the ‘fun’ that can be had by fleet managers or procurement professionals in the process of stretching potential suppliers to meet demands in the tender process. In reality, this is both short-sighted and a waste of time. It begs to ask the question: ‘Why is it that we play this procurement game?’
If you want cheap, you get cheap. Supermarkets have been running loss leaders for years. Do you think the contract hire and leasing industry is any different? From a supplier or funder’s point of view, if they’re forced to submit low pricing at the outset just to ‘get a foot in the door’, where do you think it will be made up? It’s simple.
Firstly, either in-life through price increases or at the back end, of which both draw sighs and complaints from fleet customers accusing providers of excessive charges, termination penalties or fees.
Secondly, through the cutting of service and operational costs, thus jeopardising the ability of a provider to add real value. So who’s to blame then? It cannot be both ways.
Time and again I see companies issue the annual or three-yearly tender with potential providers ‘jumping through hoops’ to compete. For the majority (but not all) of tenders I have witnessed, these have surely got to be the greatest waste of everyone’s time.
More often than not, there is no real desire and no business critical reason to change and so the whole affair becomes a paper exercise, with an outcome that is not dissimilar to the position at the outset before the tender. So why bother?
There’s nothing wrong with fair pricing for a fair service, but something for nothing? Come on.
This is only further highlighted by the comment from Sally Weeks at Maxxium UK.
You wrote: ‘She suggests asking for quotes for a contract hire package and then when the quote arrives, asking for something different.’
She explained: ‘If they can jump through hoops it will show how they will work in the future. Honesty and flexibility are the two key issues.’
Two questions arise here:
1) Why ask for a contract hire quote wasting everyone’s time including her own, if she doesn’t actually want one?
2) If honesty is so important (and it is an issue because it appears to be lacking generally in my view) then why not be up front about what you need? For me, personally, if I couldn’t help her, I’d say so then and waste no more time about it. To me, this doesn’t seem the most honest way to do business – does it?
This, to me, seems to be the crux of the whole discussion. There isn’t a great deal of trust between suppliers and vendors. If people took more time to develop this at the outset, we’d probably all get to where we’re going a lot faster and less painfully, and longer term we’d all be better off.
Consider your own personal relationships. From which of them do you get the most benefit – the longer term one where trust develops and grows over time, or transient encounters where agendas on both sides cloud communication and leave both parties disillusioned?
Competition is a good thing. Customers drive and demand flexibility, innovation trust and commitment from the fleet suppliers and this in turn helps the suppliers to grow, adapt and change to better serve the customers. Please though, can we all stop playing these pointless buyer-seller games?
Volvo can offer seatbelt cut-offs
SIR – In reply to Mark Winn, who wants to find a middle to senior management car with a front passenger airbag that can be switched off (Fleet NewsNet letters, February 9), he – and others like him who wish to carry babies, children or elderly people in the front passenger seat – need look no further than Volvo.
For the princely sum of £25 (including VAT), all Volvo models can be factory ordered with PACOS (Passenger Airbag Cut Off Switch) which does exactly what it says.
In choosing Volvo, he and his passengers would also benefit from the many other standard safety features that Volvos are equipped with and that have helped build their outstanding reputation for safety.
One doesn’t have to be middle to senior management to enjoy these features as the S40 and V50 have exactly the same option available. With prices starting from £15,000 and factory build lead times of only four to five weeks, why wait longer?
Divisional corporate sales manager, Mill Corporate Sales, Sunderland