If you are a small business that needs to deliver products to customers, you may have discovered that there are drawbacks in relying on third parties to complete those deliveries. Friendly, efficient deliveries are critical to the success of your business, yet you might not have any control over this element. The solution is your own fleet, but that can seem overwhelming. The tips below can help you think about how you might manage such a fleet as an entrepreneur and whether having your own is the right choice for your company.
Get the Right Equipment
You need to correctly calculate how many vehicles you’ll need and the size they should be. Try to be as precise as possible because you do not want vehicles and space going idle, but if you have to fall back on third parties because you are short, you’ve defeated the purpose. Take a look at the economics of different types of vehicles, including their fuel efficiency, and consider whether you’ll buy or lease them.
The Importance of Telematics
You can review a guide on the many ways that telematics can help you with fleet management. With telematics, you’ll always know where your drivers are, and they can communicate with one another via GPS receivers as needed. Telematics can help you track how efficiently your vehicles are performing and if any issues are arising. They can also track driver behavior.
Incentivize Driver Behavior
Monitoring your drivers with telematics can be great for efficiency and less great for employee morale. To combat this, you should focus on offering incentives for drivers who perform well. This means working efficiently without speeding or otherwise being unsafe and taking steps to save money as well. Approach the tracking of drivers as something you do as a team in order to help them improve and not as a punitive measure. Train your drivers well, and reward them for doing a good job. Do not push them to compromise safety even if it means delays. If this becomes a consistent problem, your solution should be to add more vehicles and employees.
You’ll need to monitor costs closely if you are going to be successful at having your own fleet. These costs can mount quickly, so you need to have a good system in place for tracking costs before you get your vehicles out on the road. For example, fuel cards are a great way to get instant data on how much your drivers are spending on this. Getting the right software will be critical to tracking costs and helping you determine what is often referred to as the true cost of ownership, or TCO.
Your costs will include fuel, maintenance, registration fees, insurance and more. This will be one of the most critical parts of your management because if your records are inaccurate, you could end up spending far more than you can afford before you realize it. Or you could be denied a small business loan when you approach lenders for financial support. You should also have a system for regular maintenance, which can save money in the long run since it allows you to deal with problems before they become serious.