With each passing day, compliance directives, rising transportation costs, the labor market, and ever-changing customer expectations are making fleet utilization much more challenging and tough. Indeed, fleet managers and decision-makers are taking the necessary steps to deal with these variables. But when it comes to addressing unanticipated requirements and complexities, they are unable to employ simple yet practical solutions that can optimize their fleet’s performance and achieve desired results.
As a business owner, it is imperative to have a vehicle utilization plan that focuses on monitoring, analyzing, and automating complex tasks in a hassle-free way. Our today’s blog will give you all the information to make a robust, fail-safe plan and generate profitable outcomes in the long run. We have also compiled a list of the most important strategies that can help you increase the efficiency of your fleets by 2x and use it to their full potential. But first, let’s understand some basics.
What is Fleet Utilization?
Fleet or vehicle utilization is nothing but an imperative that outlines the overall performance or use of fleets. It is a comparison of demand to fleet capacity or threshold. Demand and capacity are bound to change, while there is optimum utilization of fleets for different locations concerning separate vehicle classes at different timelines. Therefore, the approach to managing and using it also varies. To put it simply, each vehicle is different, and fleet managers need to thoroughly understand their business needs to make the most out of their fleets.
For instance, if you use 3 out of 6 vehicles at the same time, your utilization rate is 50% or 3/10 for that particular time frame. Similarly, if your target was to achieve utilization of 600 miles in a month, but you managed to complete only 300, then the utilization rate for that month would be 50% or 300/600. So how can you use your fleet effectively? Let’s understand.
Top Strategies to Ensure Better Fleet Utilization
Now that you know all the basics, it is time to define the plan of action for your vehicles and take your business to the next level. This plan should include the below key strategies to improve fleet efficiency.
#1 Leverage Tech-enabled Advancements
With the use of powerful technology tools, fleet managers can easily monitor different types of vehicles from a centralized platform and benefit accordingly. Here are a few digital solutions that you can opt for:
Fleet Management Software
When used rightly, fleet management software can improve daily operations and boost cross-team performance. It connects with different fleet members in real-time and helps make better decisions for your company. It facilitates fleet route optimization to avoid negatively impacting scheduled arrival times. Managers can store and access all the necessary information related to drivers (behavior, operational time, idle time, etc.) and vehicles (availability, maintenance, downtime, etc.) as and when required.
You can employ fleet maintenance management software to automate recurring tasks and surface information instantly. It provides freedom from monotonous paperwork and helps to plan maintenance activities accordingly.
Web and Mobile Applications
It is important to stay connected with your in-house and onsite team to have real-time visibility into existing, completed, pending, and upcoming tasks. That’s where a fleet tracking app can help. It can keep every team member in sync and maximize fleet efficiency. It gives your team the privilege to update vehicle status, complete inspections, and report issues irrespective of their location. As all records are accessible via smartphones, drivers get enough room to stay prepared for necessary transportation audits and checks.
You can use such applications to take full advantage of a GPS-based fleet tracking system and intuitive features like geofencing and RFID in order to track business-critical assets and improve data accuracy.
Data Entry Automation
Gone are the days when entering data manually was the only option to maintain the spreadsheets concerning transportation expenditure, work orders, timelines, and other useful information. Today, fleet owners can easily simplify this entire process and get a comprehensive view of their daily operations with data entry automation. Vehicle management professionals can receive live updates and easily source important data from integrated systems like GPS and telematics or fuel cards.
Apart from reducing manual work, automating data entry helps configure gathered information to complete designated tasks within stipulated timelines and improve fleet performance.
#2 Track Necessary Fleet Metrics and KPIs
Collecting and closely observing data is one of the best fleet management strategies that fleet experts can rely on. They need to keep an eye on essential metrics such as total miles traveled, fuel consumption, and time utilization. Yes, you can analyze after-hours utilization and successfully remove congestion issues. But you need to identify whether tracking this metric is necessary to achieve certain business goals. Other key performance indicators for fleet management include engine on/off, speeding, acceleration, and hard braking, idling, route adherence, and road safety compliance.
To ensure better fleet management and maintenance, you need to track important metrics such as vehicle total cost of ownership (TCO), vehicle replacement costs, schedule adherence, total vehicle breakdowns, vehicle part inventories, and average maintenance downtimes. Apart from all this, it is important to regularly track the job history to identify the areas that demand improvement. This helps you eliminate the bottlenecks related to customer service.
#3 Go for Preventive Maintenance
An inefficient fleet utilization approach often leads to downtime. But you can easily avoid such scenarios by regularly servicing your vehicles. You need to make sure that every operational vehicle is in good condition to steer clear of unanticipated breakdowns and repairs. You should ask your team to create preventive maintenance schedules in order to enhance the lifespan of your vehicles. This can be challenging, but investing a decent amount of time and effort can help you stay on the right track.
Your fleet managers can observe odometer readings or hourly intervals to set service reminders and get notified about the routine maintenance activities accordingly. These reminders eliminate all the assumptions and suppositions and increase the overall fleet productivity.
#4 Implement a Vehicle Use Policy (VUP)
It is important to follow a set of rules and regulations to use and manage your fleets effectively. For that, you need to introduce a VUP and abide by its norms. This will not only help in analyzing driver behavior but also outline some key areas, such as vehicle maintenance tasks and how to reduce fuel consumption, thereby ensuring seamless service within the set budget.
To increase fleet efficiency, it is imperative to keep all the professionals well-informed about the aims and objectives of VUP. This policy will help them avoid making mistakes and get aligned with a common purpose of utilizing vehicles meticulously. It will highlight the demerits of non-compliance, suggesting better time management and cost distribution. Some of the significant topics and concerns that should be addressed in this policy are as follows:
Drivers play a crucial role in using a vehicle in the best possible way at a low cost. But when it comes to fuel consumption, they need to put in some extra effort to minimize the related expenditure. As such, your VUP should include certain guidelines to avoid harsh driving, accelerating unnecessarily, and excessive use of brakes idling their vehicles in order to reduce the amount spent on fuel. It should focus on key factors such as ideal driver behavior, route navigation and optimization, and on-road etiquette.
The practice of using vehicles after working hours or unauthorized use of vehicles causes an extra financial burden on the organization. Hence, it is necessary to include norms in your VUP that push responsible fleet personnel to park all the vehicles in one central location when their jobs are complete. Keep a tab on selecting the right vehicle size for different tasks and customized requirements. Prioritize regular checking of vehicles and give your team a brief idea about the same beforehand. Focus on corrective action to establish a robust commercial vehicle fleet management roadmap.
Non-compliance with necessary requirements may disturb your fleet utilization framework and convert the smallest issues into major obstacles. On the other hand, a vehicle in a non-working condition incurs a loss in revenue. For instance, having a minute indicator issue can cause a car accident, while a low level of oils or coolants can lead to major defects in the mechanism of a vehicle. But you can easily avoid these inefficiencies by encouraging routine maintenance across the entire vehicle lifespan. This also includes the evaluation of vehicle licenses, insurance, necessary documents, etc., to avoid penalties.
Make sure a job card is maintained by drivers having the details regarding servicing dates. Daily checks such as the functionality of lights, brakes, oil levels, and air pressure should be made mandatory before starting to use the vehicle for the assigned task. Arrange a regular inspection of the fleet so that every vehicle can get the required attention, and all the mechanical issues can be solved at the initial stage.
Successful implementation of vehicle fleet management services is a result of many components such as properly implemented action plans, promptness, handling scheduled and unscheduled routing, and so on. But this is only possible with proper communication and coordination among team members. Hence, you need to make proper guidelines that promote operational improvements via optimal use of available resources. Ensure a certain level of transparency for particular tasks such as work order scheduling to streamline your fleet management process.
With all the above, you would have surely understood how to improve your fleet utilization in today’s digital age. Implementing these strategies will help you fine-tune your efficiency standards and track your vehicles’ performance in real, controlled situations. It will help your company successfully handle unpredictable last-minute changes and grow exponentially. It will encourage your fleet managers to quickly pivot and iterate alongside boosting their decision-making abilities. If you want to build a one-stop platform to utilize and manage your fleets seamlessly, you can outsource your requirements with Mobisoft and unlock countless business opportunities right away.
Nitin Lahoti is the Co-Founder and Director at Mobisoft Infotech. He has 15 years of experience in Design, Business Development and Startups. His expertise is in Product Ideation, UX/UI design, Startup consulting and mentoring. He prefers business readings and loves traveling.