With each day passing by, transportation costs, labor markets and changing customer expectations are making fleet utilization much harder than it has ever been. This means that fleet managers need to take the necessary steps and comply with these changes.
Many fleet managers actually can’t optimize their fleet performance as needed and achieve the results they are looking for. Right now, the fleet management market size is expected to hit around $37 billion by 2027.
In this article, we will dive deeper into learning more about optimizing vehicle utilization by using fleet inventory management systems.
5 ways to improving fleet utilization
1. Use technological advancements
With many new powerful tools, fleet managers can easily monitor the different types of vehicles they need and that benefits them. Here are some of the most powerful technological tools to use.
Fleet inventory management systems
A fleet inventory management system is incredible for tracking spare parts, avoiding stockout, and reducing costs from a mobile app. With this software, you can quickly update quantities and trigger reorder notifications. Moreover, you get helpful insights by tracking usage and improving the maintenance quality that you need.
Moreover, you can use reorder alerts for avoiding any unnecessary shipping charges that are ordered at the last minute. Fleet inventory management allows you to manage all parts and reduce part costs, which account for nearly 35% of the maintenance costs.
Furthermore, fleet inventory management allows you to manage your storage locations from multiple locations and track each of the part’s locations. This not only keeps things simple, but helps you keep your inventory organized.
Data entry automation
No more manual data entry, but instead, it’s now about creating spreadsheets for vehicle utilization about your transportation expenses, timelines, work orders, and all other essential information, which you can learn from a car shipping blog. Nowadays, fleet owners can simplify processes by getting a clear picture of their data entry and operational processes. Not only will you get live updates, but also source important data from integrated systems such as telematics, GPS, and more. Incorporating advanced data entry systems can significantly reduce manual efforts and increase the accuracy of fleet data management.
Not only do you benefit from reduced time consumption, but you also complete tasks and improve fleet performance much faster.
Mobile and web apps
Staying connected with in-house and onsite teams is important if you want to have real-time visibility for your upcoming and existing tasks. It not only helps team members maximize their fleet’s efficiency, but it also allows them to update vehicle status, report issues, complete any inspections needed and more. Moreover, mobile phones have expanded our horizons for us, so drivers are prepared for any audits and checks via their mobile phones.
The applications you download will grant you access to GPS-based fleet tracking systems, RFID, geofencing, and many more important applications for improving data accuracy.
2. Determine your optimal fleet size
Excessive costs and any unnecessary costs will only result in an oversized fleet. Moreover, this will show that you won’t meet customer demand if you’re relying on small fleets. You can determine your fleet’s size by using a fleet utilization process. This not only reduces costs, but also meets customer demand.
The number of vehicles in a fleet will depend on the time and various aspects, such as the available budget, service level, market demand and more. Therefore, organizations for this exact reason need to calculate the number of vehicles required for a specific time period.
Determining your optimal fleet size results in three case scenarios:
- The ideal number of vehicles required is much higher than the ones the company has. If the vehicles required are higher than that the company has, more vehicles need to be acquired then.
- The ideal number of vehicles is much lower than the company has. In this case, some vehicles need to be sold off.
- The ideal number and required number of vehicles in the company are the same. There’s no need to acquire new vehicles or sell them.
Before acquiring new vehicles or deciding to sell off existing ones, explore the option of purchasing quality used cars which can be a cost-effective solution. Trusted dealerships, such as EchoPark Automotive, offer a wide selection of pre-owned vehicles that can meet various fleet needs without compromising on quality.
For these exact reasons, you need to have a plan for your acquisitions and the vehicles you are planning to sell off.
3. Know your type of vehicle fleets
There are three important types of vehicle fleets you can consider for reference or basic. They are the following:
- Planned routes: Demands that originate from performing a service are the delivery and pick-up locations in certain geographical areas, which associate good amounts of passengers, waste, and more, that need to be delivered in specific time periods, such as days, weeks, hours, and more. To maximize efficiency and minimize costs, route optimization algorithms can be used to determine the most optimal paths for these deliveries and pickups. An excellent example of this fleet would be delivering, or picking up packages for your passengers, mail and cleaning services, etc.
- The demand for vehicles: This demand will be from random usage of vehicles in a geographical area, such as people that are using vehicles for transportation purposes, or for addressing any incidents that occurred such as firefighters, police, and ambulances.
- Vehicles assigned: The vehicle assigned will depend on the demand. For example, if there’s a fire, the vehicle assigned will be a fire truck.
Any type of fleet can be assigned to any position, depending on its characteristics. At the end of the day, everything will depend on the demand and the type of case scenario for assigning a vehicle. For example, if you own a sales company, you’d need to assign a vehicle to each sales representative. In this case scenario, you would need to calculate travel costs and minimize variable costs by maximizing the overall number of sales visits.
4. Use a vehicle use policy (VUP)
If you want to effectively manage your fleet, you need to follow the right rules and regulations. This not only helps analyze driver behavior, but keeps the vehicle maintenance tasks and reduces fuel consumption, ensuring the right budget for it.
In order to increase fleet efficiency, you need to keep professionals well-informed about VUPs objectives and goals. This policy not only helps them avoid making mistakes, but also promotes vehicle utilization. Before you set up this policy, you need to address the following:
- Vehicle usage: Should state how the vehicle is used outside of working hours, or the consequences if the vehicle is used without any authorization. Moreover, the VUP should state where vehicles should be parked when not used. Additionally, never forget to determine the correct size of the vehicle based on the task and requirements. Always prioritize regular checks of your vehicle.
- Vehicle coordination: Successful implementation of vehicle fleet management service is a result of many components, such as the proper action plans, handling scheduled and unscheduled routing, and more. However, this is only possible when the right level of coordination is passed among team members. Nevertheless, don’t forget to create suitable guidelines for increasing operational efficiency.
- Vehicle maintenance: Not complying with the needed requirements might hurt your overall vehicle utilization process. The smallest issues might become even bigger when they aren’t addressed and let’s not forget, vehicles lose value over time. Vehicle maintenance is what promotes efficiency in a vehicle and improves its lifespan. Vehicle maintenance is best when you have a job card that shows when all maintenance periods were performed, such as the brakes, oil changes, filter replacements, etc. Roughly 8% of consumers claim that they always delay their vehicle maintenance and this isn’t a good sign.
- Vehicle driving patterns: Drivers play a crucial role in the longevity of the vehicle and how it’s used will determine its long-term costs. Also, fuel consumption is important because a driver who brakes and accelerates hard will only increase long-term fuel expenses. Therefore, you should focus on driver behavior, driving optimization, route navigation and more.
5.Encourage asset tracking
Asset tracking is excellent for allowing you to see where your assets are, how and when they are used. This insight is for ensuring that you have the proper assets and the right amount. Additionally, let’s not forget that knowing more about your assets is the first step in increasing your vehicle utilization and decreasing waste.
Another benefit associated with it is fraud prevention. With asset tracking, you can track them in real-time and this automatically will inform local authorities, where you can immediately react.
The whole point of optimizing vehicle utilization
Vehicle utilization is good for long-term costs and for promoting the longevity of your vehicle. It not only reduces your task load, but helps you overcome any challenges and large costs that build up over time.
You have many other tasks to worry about, so using a fleet inventory management system is not only helpful, it’s great for keeping your vehicles on the road for long periods of time.
Efficient fleet inventory management systems play a pivotal role in optimizing vehicle utilization, especially in an industry that saw a remarkable 86.1 million units sold, underscoring the need for streamlined processes to meet the growing demands of the market.
