As the pandemic evolves, Element remains focused on helping clients navigate these challenging times. A common request from fleet managers is for assistance with ways to manage costs and to boost productivity during down times. My team and I have identified our top ten tips that fleet managers can begin to implement immediately to proactively address costs and use this time wisely.
1. Evaluate idle vehicles
Determine if they are all needed during the current crisis. Assess what should be shipped to auction and what can be redeployed to other segments of your business that remain active during the crisis. Fleet managers should set a goal for idle assets – typically fleets have between 1-3% idle vehicles to accommodate surge demand. Depending upon your businesses, this will vary. In addition to setting a goal for idle vehicles, set a goal for cost savings such as $1,000 cost per month reduction.
We are monitoring the resale market daily. If you have extra vehicles (including owned), allow us to get them to the auctions where we can hold and sell opportunistically.
3. Sale leasebacks
With low-interest rates, consider sale leaseback of non-leased assets including heavy trucks, trailers and equipment.
4. Toll roads
Limit use of toll roads during this time where you could unknowingly incur violations due to closures and changing hours. Take advantage of minimal traffic on other roads.
Evaluate rental vehicles/equipment and eliminate where possible.
Place factory orders to obtain first production slots when factories re-open.
7. Other Costs
Explore various strategies to minimize cost (transport company parameters, distance guides, etc.) Engage your drivers who may have capacity, and encourage their ideas on general cost savings opportunities.
This is a good time to conduct tool and equipment audits to lighten the load of vehicles and thereby reduce fuel consumption.
To increase driver productivity, review various policies and processes.
Schedule vehicles to get caught up on maintenance. Most providers are still open and have low volume levels.