Managing a transportation business is not easy. There are a lot of factors that affect the fleet management service. You need to evaluate all possibilities and make appropriate plans to reduce the risks.
In this blog post, you will learn about some tips that can help in efficiently managing your fleet business. Following the tips mentioned here will help your new or established business to be more successful.
1. Get a Detailed Understanding of the Costs
Cost control is critical for any business. But this is particularly important for a logistics firm. You need to get a detailed understanding of costs involved in transporting goods from one location to another. It is important that you keep track of vehicle maintenance, fuel, repairs, fleet washing, and other vehicle operational expenses. Moreover, you should know about the administrative and financial expenses.
Make sure that you factor unexpected events that can result in increased costs. For example, road repairs can require rerouting that can result in increased fuel expenses. In addition, you should account for vehicle breakdowns, accidents, and other unexpected costs.
Deadhead miles should also be considered that represent a major cost for a logistics business. It occurs when a vehicle has to get back to base as there are no orders nearby. This is where load boards come in handy. You can find available tweener loads or short-distance loads that can lessen the impact of deadhead miles.
2. Don’t Rely Too Much on Load Boards
Load boards like Internet Truckstop, NextLOAD, GetLoaded.com and other are important to get orders. In fact, most startups get their business up and running through the services of load boards.
But experts recommend that you should not rely solely on load boards for getting orders in the long term.
Relying on load boards won’t help you maximize the profit. Consider building your own clients. Dealing directly with customers will help you get better rates instead of working through a load board or broker. Building clients is a tedious process that will require a lot of closed doors negotiations. But the effort is rewarding is it will result in improved profits and referrals.
3. Use Technology to Avoid Route Congestion
Route congestion is a major challenge faced by transportation companies. Traffic at the port often becomes congested during peak hours. The vehicles creep towards the pickup destination resulting in excess idle time and fuel costs.
You should use a route planning software to review port congestion data. Some software provides real time data of wait time at terminals. You can use the data to ensure that the drivers use less congested routes. Moreover, you can partner with terminals for access to dedicated lanes. This can help reduce the idle time that will have a positive impact on the company’s bottom line.
4. Regular Fleet Washing
A lot of logistics companies overlook the importance of regular fleet washing. Regular washing of the vehicles is important in many ways.
The foremost benefit of regular washing of vehicles is that it will ensure optimum fuel efficiency. Dirt and dust create a drag on the large vehicles. It results in the vehicle consuming more fuel. By regular washing, the vehicle won’t consume too much fuel resulting.
Another benefit of regular washing of vehicles is that it will have a positive impact on the customers. Clean and well-maintained vehicles will reflect a professional image. This will help increase the chances of repeat business.
Lastly, regular fleet washing will also lead to improved driver satisfaction. Drivers will love driving a clean and slick vehicle. This will lead to a reduced driver turnover benefiting the company.
5. Look for Opportunities to Optimize Efficiency
Managing a fleet management business successfully requires that you offer more cost effective solution to customers as compared to the competitors. This means that you should always be looking at ways to cut costs and optimize efficiencies.
Using technology can help improve the fleet management process. Fleet management software can help automate the process of recording driver time, miles covered, and other operations. The software can pull information from GPS trackers and other integrated systems to provide real time updates about the traffic conditions.
You can also use scheduling software that triggers service reminders to ensure that vehicle maintenance is on track. Some software generates electronic vehicle inspection reports (eVIR) that will help you manage vehicle inspection.
Fuel consumption is one of the main costs of transporting companies. You can use fleet management software that integrates with the fleet card data. The software calculates cost-per-mile for each vehicle that can help in monitoring of fuel costs.
6. Driver Retention Programs
Driver turnover rates represent a great cost for logistic companies. Training new drivers to do the job properly represent a significant cost for the company. A successful trucking company can maximize profits by retaining drivers.
Create a retention action program with a focus on improving driver satisfaction. You should get feedback from the drivers to know what is important for them. Give them performance based monetary incentives. Also, focus on creating a work-life balance for the drivers to improve satisfaction and retention.
7. Clear Communication with Clients
Clear communication is important when dealing with clients. Even a slight misunderstanding can have a negative impact due to which your customer can switch to a competitor. To avoid any confusion, it is important to make the terms clear up front so that the clients know what is expected.
8. Remain Compliant to Legislations
Make sure that you keep track of the changing regulations that apply to logistics and transport companies. Complying with regulations will avoid violations and fines that can have a positive impact on customer satisfaction.
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