If your business has a fleet of vehicles, you know that managing the operating costs is your most challenging task. With numerous cars, vans, trucks, or bikes under your command, you'll run into countless ongoing expenses.
Improper management of these costs can put your business in a dark place where you're making a loss. Thankfully, you'll be overjoyed to learn that reducing the operating costs is much easier than expected. Take a look at the tips below to see what you can start doing:
Use electric vehicles
A lot of companies are making the switch to electric vehicles nowadays. Amazon is a massive business with a huge fleet, and you've probably seen the TV adverts on them going electric.
The benefit of an electric fleet is two-fold. For one, it is much cheaper and more affordable to run an electric vehicle than a fuel one. Over time, the costs will come out in your favour, that's for sure.
Secondly, you benefit from being a more eco-friendly company. While this has nothing to do with your operating costs, it does have an impact on your reputation. People think highly of a business that actively tries to reduce its carbon footprint. Thus, you can draw in new customers thanks to your new reputation as a green business!
Invest in a fuel card
A fuel card is pretty much essential for companies with fleets. There are loads of different variations and providers out there, as you can see on the Right Fuel Card Company website.
No matter which one you choose, a fuel card benefits you by letting you pay for fuel and charge it in a settled account. All of the purchases are interest-free, which helps you save a lot of money over the months and years.
Also, fuel cards provide you with HMRC pre-approved single invoices. This is another financial benefit as you can use them to easily claim back VAT. As such, this means you start spending even less on your fuel because you claim this percentage back.
Overall, it's seen as a far more financially efficient way of managing fuel payments, when compared to using a standard credit card or cash.
Seek out fuelless alternatives
We're talking about fuel a lot, mainly because this is the biggest underlying cost of managing your fleet. Electric vehicles reduce the cost of fuel, but what if you opted for a different sort of alternative vehicle?
We're talking about all the various transport options that don't run on fuel at all. The main one to consider is a bike - is it possible for people to cycle instead of drive? This can work for some fleets, depending on what your business does.
If you operate a delivery company, you could send some people out on bikes to deliver small packages, reducing the number of cars/vans on your books. Again, it also cuts down your carbon footprint, but the main benefit is that bikes are cheaper to buy and require no money to be spent on petrol or electricity!
Furthermore, you could go down the more advanced route and opt for some drones. Granted, they cost a lot of money to initially purchase, but you don't have to keep topping them up with petrol every week.
Charging a drone will also use hardly any electricity than an electric car will. You won't be able to replace your entire fleet with these fuelless options, but it's worth thinking about replacing a few vehicles with them.
Buy brand new vehicles
Usually, it's recommended that you buy used vehicles when purchasing a new car. But, for a business fleet, brand new ones are a better option. There are a few points to back this up, one of which doesn't link to the topic, so we'll get it out of the way.
Brand new vehicles improve your professionalism and reputation because they look shiny and impressive. Plus, you can easily buy a fleet of the exact same vehicle, which further reinforces your brand image. With used ones, you could end up with a mismatched fleet that looks quite beaten and bruised, harming your image.
Now, back to the operating cost savings!
Brand new vehicles do cost more money than used ones, but they come with two advantages. Firstly, they are completely fresh, with no lingering issues to worry about. Therefore, they should last longer than used vehicles, reducing the frequency of replacements.
A cheap van can be bought easily, but is it cheap if you have to keep replacing it every few years? In reality, you'd save more money on the operating costs by investing in more expensive vehicles in the beginning.
Secondly, a brand new fleet won't need to be serviced for the first few years. When a vehicle is three years old, it legally needs to undergo a yearly MOT. This costs money, but you can avoid paying it for the first three years of your fleet's life.
It may not sound like much, but every little helps! Also, the good condition of the vehicles means you're less likely to spend loads of money on repairs.
Keep up with good fleet maintenance
Finally, you can reduce the operating costs by maintaining all the vehicles in your fleet. Ensure that the tyre pressure is checked monthly, the oil replaced, and all the other essential vehicle maintenance tasks.
This will keep the fleet in excellent condition, lowering the chances of things breaking or becoming damaged. Also, it makes the vehicles far more fuel-efficient!
Let's say you do have a petrol fleet - because you can't afford electric vehicles - and you don't check the tyre pressure regularly. What tends to happen is the deflated tyres demand more work from the engine, burning more fuel.
Thus, the vehicles need to be refuelled more often, ramping up the costs. So, you can see why maintenance is essential to save money!
There are plenty of tips above for you to use to save money in your business. You don't have to use every idea, just pick ones that make the most sense for your company. Now, you'll keep operating costs low, allowing the profits to soar high.