Could Fleet Outsourcing Be A Long-Term Solution for Fleet Managers?
It has always been preferable to use inhouse drivers and vehicles in fleet management, but the global pandemic has called everyone to question beliefs that they once held as true. Today, we are considering whether outsourcing your fleets could become a worthwhile solution for the long-term, in a post-pandemic industry plan.
We’ll look at what this means for your planning, the industry, and how it could affect your workers.
Despite the disruptions, the pandemic has brought some positive changes to the world. In fleet management, this has resulted in new innovations to increase efficiency. In a recent survey on Fleet News, a third of fleets surveyed said that they expected to be running fewer company cars in the future. If businesses are hoping to achieve the same product margins with fewer vehicles, then this means that they have either substantially improved their efficiency, or are outsourcing their vehicles.
Nonetheless, the same survey found that many businesses in the fleet management industry were looking more towards digital solutions – especially regarding video conference calls. This likely means that without having to meet individuals in person, management are now saving their travelling time to focus on more important tasks.
OUTSOURCING SOLVING UNCERTAINTIES
With the approach of Brexit, fleets are also nervous about the future of their industry. Those parts of their businesses which have been outlined as potentially unnecessary during the pandemic may become further redundant in a post-Brexit country.
For fleets, this could mean that the uncertainty of knowing when their full host of company vehicles could be active again will result in severe downsizing. For some companies, it may indeed be preferable to sell company cars and rely on outsourcing contracts than to let idle vehicles devalue in the yard.
FACTS ABOUT OUTSOURCING
The pros of outsourcing fleet business has been a consideration since at least 2015, according to this article on Fleet News. The article suggests that savings of up to 10% could be made yearly from outsourcing; however, the recommended changes were not affecting drivers but focusing on company management. The article also stressed that outsourcing should be considered by different companies for different reasons, and has more benefits than simply cost-cutting.
It is likely that those companies who gave outsourcing as a business plan true consideration in 2015 were better prepared for the unusual circumstances that we find ourselves operating in currently. One of the greatest benefits that can be achieved from a successful outsourcing contract is the sharing of information and practices that come with it. A good outsource partner can teach a fleet and its management that there exists a higher level of expertise, professionalism, and improvements to be made.
This means that even a small contract could provide your company with improvements that will cover you for future years.
REASONS TO OUTSOURCE YOUR FLEET
We have mentioned a couple of the reasons why you might choose to outsource some of your fleet operations. In the case of the pandemic, it might be that you are downsizing, but if business picks up more than you expected, then you may have a sudden greater need for vehicles than anticipated – which outsourcing could help you solve quickly.
Alternatively, if your business has room to grow, then you might be deciding between hiring new drivers or partnering with a company to whom you can outsource some work. This can create exciting new opportunities for work, as well as sharing knowledge which can help you to improve your business along the way.
The third reason why a fleet manager might look towards outsourcing is to cut costs. Whilst this practice has been shown to have positive effects on company profits, it isn’t the only way that companies can improve their revenue.
We have plenty of advice on how you can cut costs without needing to look into outsourcing – although a smart company will consider how it can profit all ways. Here are just a few of our recommendations for companies looking to cut costs:
- Reducing Fleet Insurance Costs
- How to Minimise Your Fleet’s Costs Post Coronavirus
- Fuel Costs: Are You Doing Enough?
We offer fuel management systems, which help fleets to reduce their fuel expenses substantially. By cutting down on time spent taking inventory checks and monitoring which vehicles are using the most fuel, you can identify areas in your business that can be easily improved.