Navigating financial pressure in fleet management

Managing costs, staff retention and investments when margins are tight

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Managing a large transport fleet is a complex and cost-intensive business. You’re constantly in a battle to maintain operational efficiency while keeping rising expenses under control and, of course, ensuring your trucks are where they need to be, when they need to be there.

As fuel prices fluctuate, maintenance costs increase, and new regulation comes down the pipe seemingly every month, the expenses can pile up fast.

This guide is here to help.

Here we explore the financial challenges fleet managers face in large fleet operations today and offer insights into optimising costs while maintaining high performance and compliance.

The financial challenges of a fleet manager

So, what are the many financial challenges facing fleet managers today? Here are some of the most pressing pain points.

Fuel cost

Let’s state the obvious: Without petrol in the tank, your trucks are going nowhere. That puts the profitability of each and every transport company on the planet at the mercy of fuel prices – a notoriously unpredictable factor.

Transport companies also tend to travel long distances to get the job done. So, if route planning is not being handled efficiently, the challenge becomes even greater. Considering all these factors, implementing fuel-saving strategies is crucial for staying profitable.

Fleet maintenance and vehicle management

Your trucks are clocking up a lot of kilometres out there on the motorways. Even the most experienced drivers in the world can’t prevent wear and tear naturally impacting your vehicles. The only efficient option for minimising downtime while keeping repair costs low is preventative maintenance: act first before breakdowns and disruptions hit you hard.

But vehicle management is not just about maintenance – it’s also about replacement. Fleet managers must carefully weight the costs of ongoing repairs against the expense of upgrading to a new model. And this is not always a simple calculation.

Insurance and compliance costs

While everybody understands how fuel costs hit transport fleets, insurance premiums can be just as challenging. As fleet sizes increase, operational risk increases too. That means more and more budget needs to be spent on premiums putting a serious strain on the bottom line.

Then there’s the compliance issue. Keeping on top of emissions standards and safety regulations not only requires time and attention but often demands financial investment too. Plus, if you get it wrong, you might also earn yourself an unpleasant fine to deal with.

Driver-related costs

While the cost of hiring and training a driver can usually be clearly calculated, the cost of losing talented drivers can be harder to judge. We all know about the driver shortage that is impacting European transport in all kinds of ways. One consequence is that a skilled driver is not an easy thing to find or retain.

How can you keep drivers happy in their work while maintaining profitability? Get more insights on driver management.

Technology and operational costs

To navigate the evolving challenges of today, more and more transport companies are turning to digitisation. As we have seen over the past two decades, greater levels of automation and digitisation of the fleet management operation pays off, reducing costs, improving productivity and protecting drivers and vehicles.

However, adopting new technology and tracking systems comes with its own challenge. Namely, how do you ensure that the investment in a new solution will pay off? And how do you get to the ROI as quickly as possible?

What can go wrong?

Higher operational costs

If you don’t take control over how much you spend to keep the business running, expenses will continue to rise and profitability will fall.

Increased downtime

Reactive maintenance and inefficient scheduling translate naturally to downtime. With trucks unavailable, your deliveries do not get made and your revenue suffers.

Regulatory penalties

Failure to comply with the slew of regulations that oversee transport in Europe can mean costly fines. Plus staying on the right side of emissions standards, driver regulations and similar legislation often requires investment.

Driver dissatisfaction and turnover

While every company aims to hold on to top talent, the driver shortage makes the risk of employee dissatisfaction even greater for transport companies. A high driver turnover increases recruitment and training expenses while reducing efficiency.

Missed business opportunities

If you’re constantly struggling to balance the budget and keep costs under control, it makes scaling operations tough. New business opportunities offered by, say, investing in an advanced fleet management solution, may pass you by as you try to hold on to profitability in the short term. In the medium term, however, this will see your business overtaken by more forward-thinking competitors.

What type of solution do you need?

OptiDrive 360

Empower your drivers to adopt a more fuel-efficient driving style on the road with clear, actionable insights on driving behaviour. Speeding, harsh steering, sudden braking and idling can all be tracked, so you can take targeted action to cut costs.

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Professional navigation

Keep drivers out of traffic, away from restricted areas and on the most efficient routes with Professional Navigation powered by live traffic data and advanced algorithms. Meanwhile, route optimisation allows you to select the perfect journey for every job, taking into account more than just the distance but also the number of turns, traffic patterns, access to fuel, rest stops and much more.

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Vehicle maintenance

Keeping your vehicles roadworthy and reducing the cost of downtime and repairs is best handled with proactive, scheduled maintenance. Catch issues before they become expensive problems thanks to simplified planning and scheduling of regular maintenance checks up. You can setup notifications and utilise odometer readings to set defined service intervals to make things easier and more cost effective.

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Workflow management

The easier you can make the working day for your drivers, the better it is for your business. By empowering them with convenient, user-friendly solutions, you can increase job satisfaction, increase employee retention and increase productivity. Connecting Webfleet workflow management solutions with the PRO Driver Terminal supports seamless communication between you and your team in the field. Drivers spend less time in traffic and less time on admin.

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Fuel monitoring

Without clear insights into how much fuel you consume and what factors are affecting it, you cannot even begin to take action to reduce your fuel costs. Webfleet maps it all out for you in clear fuel consumption reports. See trends over time to pinpoint what’s causing you to unnecessarily consume petrol and use this on-going monitoring to leverage and track targeted strategies to save.

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What’s next?

We’ve taken a look at some of the main ways transport fleets like yours are feeling financial pressure. We’ve also considered some of the best solutions for relieving the pressure and staying profitable and productive.

What’s next? Taking action.

Whether you are hoping to control the costs of regulatory compliance, maintenance, fuel, insurance or driver retention, it is critical to take a proactive approach. The costs of the market will only become more complex in an increasingly complex world. Fleet managers that survive and thrive will be the ones that move quickly and intelligently to get their budgets under control.

Webfleet offers a suite of powerful solutions to help businesses take that action. What’s more, our advanced fleet management solutions are precision designed to be as easy to use as possible. That means learning to use them to optimise your fleet performance is simple and getting to the ROI is quicker.