Fleet News

Daily rental: Getting a fair deal for a good service

Amid warnings that fleets using daily rental could face higher prices as business conditions worsen, it is worth taking stock of what the industry is getting for its money.

The answer may well depend on your negotiating skills but, in general, it’s difficult to get a bad deal in rental.

Superminis can be secured for less than £20 a day and even upper-medium cars can cost less than £40 a day.

It is still possible to have delivery and collection thrown in for free if your business is important enough.

But most professional fleet managers will wince at the idea of hammering down suppliers to the lowest possible price.

To get the best from rental you need a professional approach that focuses on partnership and mutual benefits, including allowing suppliers to make a profit.

With a focus on getting value for money, rather than the lowest price, fleet operators can make the most of the flexibility of hire vehicles.

Modern rental companies provide a lot more than just the vehicle.

Rental should now be considered as a core funding option alongside other methods such as leasing and outright purchase, according to Phil Moorhouse, managing director of Northgate, Britain’s largest rental firm.

This year it launched a new sale and rent-back service designed to help companies release cash from outright purchase vehicles by selling them to Northgate and turning them into rental vehicles.

“Rental is more beneficial to companies needing to reduce their exposure to any possible economic downturn.

“A sale and rent-back arrangement gives companies a double benefit of an initial cash injection into their business and the bonus of rental flexibility,” Mr Moorhouse says.

The short-term commitment that comes as standard in a rental vehicle means it is ideal for coping with swift business growth and any sudden contraction in the fleet can be achieved without incurring the normal penalties in handing back a contract-hired vehicle early.

Online rental management services are becoming part of the standard packages rental companies and intermediaries are able to offer.

Inchcape Fleet Solutions recently launched iRental, which enables customers to place, view and amend vehicle hire bookings online, while Nexus Vehicle Rental’s IRIS rental management system provides an independent total rental management solution online.

Arval has announced it is to provide online booking of short-term hire through a new dedicated website that uses 1link Hire Network e-commerce technology.

Among the daily rental firms that provide similar services direct is National Car Rental’s www.carhirebooker.com, a Fleet News Award-wining system with direct links to the rental firm that allows customers to track orders and view important fleet management information.

But rental companies are going even further in their quest to add value.

This year, Northgate Vehicle Hire announced that it would offer customers free vehicle monitoring for a limited time when they signed up to deals.

Telematics technology is so effective at helping cut costs by reducing mileage and waste, that the free offer could offset much of the cost of the initial rentals.

Opting out of delivery and collection and instead asking for free pick-up services offered by some short-term hire companies can cut emissions by 30%, according to Masterlease.

Gavin Jones, services manager at Masterlease, says: “We estimate that if all of our customers used this service it would save 20,245kg of CO2 a year. ”

Supplier checklist

Service levels: These must be the number one consideration. Can a supplier meet your requirements? Ask other customers for their views.

Fleet and network size: Check that the rental fleet can be provided where you need it, when you need it and the right vehicles are available.

Management information: Cost control is dependent on having the best data available. Make sure your rental supplier can provide it.

Delivery & collection: If required, then check it covers home and business addresses, and is available inside and outside of normal branch opening hours.

One-way trips: Ensure vehicles can be collected from one location and returned to another for one-way trips. Many smaller providers cannot offer this service.

Online services: These are often an essential part of the rental package so ensure the providers will offer an IT system that controls the entire process and allows you to manage rentals effectively.

Branch network: Fleets often need vehicles at short notice, so a branch network that fits your business is vital.

Product range: Some rental companies offer attractive and flexible options for medium-term rental for both cars and commercial vehicles. This may be a more cost-effective option in the case of new starters and employees on fixed-term contracts.

Consultancy: A good rental provider will be able to help their customers identify, formulate and operate a rental policy that matches the needs of their fleet and their business.

Added value: Check whether your business will obtain added value benefits for staff, such as discounts on private rentals, including holiday rentals.

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