Fleet managers play a pivotal role in any transportation company or a logistics company when it comes to selecting and maintaining vehicles and keeping up with delivery and distribution schedule. Fleet management plays an essential role in the transportation industry as fleet managers strive to minimize risks associated with vehicle investment.
Fleet management companies are always on the lookout to improve efficiency, productivity and reduce their overall staff and transportation costs. Successful fleet managers usually have years of experience in the field dealing with fleet operations, logistics, contract negotiation, fleet maintenance, and fleet management systems. However, fleet management can sometimes be challenging to deal with even after years of experience in the field.
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Driver safety and productivity
Apart from fleet managers, drivers are another vital cog in the success of fleet management services. So it is essential to ensure driver safety for effective fleet management. Accidents on the road will not only pose a question of the driver when it comes to safety but might also damage the cargo and the vehicle, causing substantial economic losses.
Fleet managers need to diligently use educational programs, regulations, and predictive analytics to ensure safety for their drivers, cargo, and vehicle. With a host of technology available including GPS, telematics, and sensors it becomes essential to educate the drivers on the use of such tools to minimize road accidents. Preventing such accidents deters not only the economic losses but also avoids potential downtime, which can hamper the service levels. Additionally, reducing the risk of accidents also helps keep the insurance premium costs down. It is always a challenge to hire experienced drivers with clean records and then train them to get acquainted with a host of new technologies.
Fuel price fluctuations
The cost of transportation or delivery per mile is one of the important metrics used by fleet management companies to determine the pricing for their services. However, this cost is highly unstable owing to the ever-fluctuating fuel prices. This impacts the final cost of the services provided, and transportation companies will often have to adjust their consumer pricing. It is almost impossible to forecast the fuel prices and, as a result, fleet managers will have a hard time managing budgets.
One of the best ways to mitigate this risk is to switch to a more fuel-efficient vehicle. As a result, fuel price volatility will have little effect on the final prices. Also, the transportation industry is assessing the possibility of using electric vehicles on a large scale.
Managing geographically dispersed teams
Large commercial fleet management companies have operations spread across state lines and international borders. Fleet managers have a hard time tracking all operations and also communicating with drivers remotely.
Additionally, locating each vehicle in the fleet can be a tiresome task as it may require continuous zooming and scrolling across a map. To combat such issues, the transportation industry is turning to technologies such as advanced mapping and spatial clustering to facilitate fleet monitoring.
A majority of the fleet management companies have already optimized their cost base. There’s hardly any room for further reduction as fleet managers would already have researched competitive alternative and selected the best fleet option.
Additionally, reducing cost is a top-down approach and requires a strategic adjustment from top management. Apart from that, fleet managers face a lot of problem in dealing with driver reimbursement, resource sharing, vehicle maintenance, and lifecycle costing. Most of these factors are out of their control, which lead to budgeting and forecasting complications.
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