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What is Fleet Management?

Last Updated: July 2, 2019

Businesses that rely on transportation utilize fleet management to control costs, productivity, fuel management, and compliance. As such, fleet management is comprised of several different tasks to keep vehicles and operations running smoothly and efficiently. Fleet management best practices involve the use of technology and software solutions to help reduce costs, enforce driver safety, minimize risk, increase productivity, and schedule preventive maintenance to reduce downtime.

A Definition of Fleet Management

Because fleet management is all-encompassing, it is difficult to define. Spireon puts it best: “Put simply, fleet management is the optimization of costs, risks and efficiency in fleet operations.”  Thus, fleet managers are responsible for controlling costs, maximizing profitability, and reducing fleet vehicle risks.

Benefits of Fleet Management

The benefits of fleet management are multi-fold. Namely, effective fleet management yields fuel savings, increases productivity, and improves customer service.

  • Fleet management reduces fuel costs–According to Verizon Connect, fuel accounts for nearly 40% of fleet ownership. GPS vehicle tracking solutions as part of your fleet management strategy can truck cabsreduce fuel costs by 20%-25%. These tracking solutions alert you to idle time per vehicle and deliver idle time averages across your fleet. They also empower you to monitor performance, track how improvements affect idle time, and help educate drivers about the need to reduce idle times.

GPS tracking solutions also reduce fuel by optimizing routes. Typically, companies that adopt these solutions reduce total miles driven by 5%-10%. Plan more efficient routes with access to maps detailing the location and destination of each fleet vehicle. You also can access driver and vehicle information while monitoring traffic and weather. Best of all, you can improve efficiency by sending the vehicle closest to the destination via the most direct route to improve customer service.

  • Fleet management increases productivityTelematics solutionsfor fleet management also increase productivity. Robust telematics software features enhance productivity by helping you gauge maintenance, reduce idle time, downsize your fleet, improve your tracking and routing, monitor safety, and improve employee efficiency.

One of the best ways that telematics solutions make fleets more productive is in tracking maintenance. Fleets can’t operate when vehicles are in for unscheduled maintenance or break down, and telematics helps you be proactive with preventive maintenance. You’ll know how many hours your vehicles run and get real-time insights into engine hour data to optimize preventive maintenance schedules. You’ll also know exactly when to replace vehicles.

  • Fleet management improves customer satisfaction– You can use fleet management to improve customer satisfaction, especially with the aid of a GPS tracking solution. Your tracking solution will help ensure driver compliance to routes and schedules to avoid missing or delaying a delivery or appointment. You’ll also improve customer satisfaction by knowing which vehicle is closest to the job to minimize travel time and get drivers to customers more quickly.

Fleet management GPS tracking solutions also help companies get drivers to appointments on time. You deal with new or cancelled appointments regularly, but you don’t have to lose productivity because of them. Using real-time locations, you can send drivers to customers on time and serve more customer needs, despite unplanned schedule changes. You’ll also give customers better driver ETAs and avoid frustrating them with vague or inaccurate driver information when you use a GPS tracking solution as part of your fleet management strategy.

Challenges of Fleet Management

Any time you have to manage fleets, drivers, costs, and schedules, you face challenges. While technology and software solutions eliminate many challenges for fleet managers, you still need to solve problems quickly. Some of the largest fleet management challenges include driver safety and productivity, cost-reduction initiatives, and fuel price volatility.

Driver safety– Effective fleet management prioritizes driver safety. To address this challenge, rely on safety education programs, regulations, and predictive analytics to work toward eliminated preventable Stobart Fleetaccidents.

Cost-reduction initiatives– Because of changing budgets and forecasts, it is difficult for fleet managers to reduce costs. The right software and tools can help, but fleet managers need experience to become skilled at forecasting.

Fuel price volatility– Even the best cost-reduction strategy can fail because of the volatility of fuel prices. Taking steps to increase fuel efficiency, decrease idle time, and optimize routes help save on fuel, but fleet managers cannot guarantee accurate fuel forecasts.

Fleet management involves operational cost-effectiveness, vehicle maintenance, driver management, vehicle safety and compliance, and operational efficiency. Effective fleet management helps you reduce fuel costs, optimize routes, increase productivity, and enhance customer satisfaction. Fleet managers also face the challenges of ensuring driver safety, reducing costs, and forecasting fuel prices.

Images via Flickr by Raymondo166and Raymondo166

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