Lessen the Liability

Lessen the Liability truck on road

Here are some easy ways to find the greatest cost savings in your fleet.

By Tony Candeloro

In the food and drink industry, your fleet is the grease that keeps the cogs of your business running. They’re not just vehicles – they’re the catalyst for getting your sales reps in front of prospects, managing your warehouses and transporting your products to where customers can purchase them.

The corporate fleet has long been seen as a necessary cost of doing business – and a large one at that. In the food and drink industry, a fleet is generally among the top three biggest expenses among companies that rely on vehicles. But technology is helping to turn the tide. From the time you purchase a vehicle to the time you sell it, there are ways to reduce costs all along the way. The first step, however, is to understand precisely where your fleet budget is being spent.

Telematics and GPS technology have evolved to become a fleet manager’s eyes and ears on the road – enough that it seems like he or she is riding in the passenger seat of every vehicle in the fleet. Now, those responsible for running fleets are able to gain real-time insight into what’s happening in the field and take immediate action to correct it. Installing telematics technology into a fleet can track fuel usage, driver behavior, vehicle downtime and countless other data points that translate very easily into real dollars and cents.

Here are three ways to transform your fleet from a cost liability into a revenue generator:

1. Create Safer Drivers

Driver behavior can be costly in a number of ways. Bad habits can reduce fuel efficiency and create more wear and tear on the vehicle itself. They can also result in accidents that could have been prevented. When an accident happens, that means the company has to pay to get the vehicle repaired and pay for a rental vehicle to replace it.

If it’s severely damaged, you may need to order an entirely new vehicle, which can result in an additional impact on your bottom line. And the costs skyrocket if there’s an injury to the employee or another driver on the road. Insurance and liability costs can be quite substantial. In fact, according to the Occupational Safety and Health Administration, the average cost of a motor vehicle crash is more than $16,000 per crash, if there are no injuries, $74,000 if there are injuries and more than $500,000 if there are fatalities.

Lessen the Liability truck maintenanceBut tracking what’s happening on the road can help. What bad behaviors are your drivers commonly exhibiting (such as harsh braking or speeding) that are leading to preventable accidents?

Getting a solid understanding of what’s happening in the driver’s seat can then inform the direction and development of a driver safety program. Tackle the most prevalent issues first to see the quickest impact on your fleet’s accident rate. Companies who have taken these steps have seen dramatic declines in the frequency and severity of accidents. In one case, a company fleet was able to reduce accident-related costs by more than $1 million in just 12 months.

2. Reduce Downtime

Beyond preventing accidents, keeping up-to-date on preventative maintenance can reduce bigger issues that can occur as the vehicle ages and lead to a decrease in downtime. Technology can track maintenance schedules and send alerts to fleet managers and drivers alike via email or a mobile device to ensure they’re being taken care of. And making sure your repair shop isn’t keeping your vehicle on the lot for longer than necessary can cut hours or even days off of your downtime.

Geofencing technology exists to let fleet managers know when a vehicle enters a shop so that they can follow up regarding any paperwork or documentation needed so the repairs can begin as soon as possible. The same technology provides an assist after the work is completed, too. It will send an alert that the vehicle has left the shop property, so it’s known by all that a rental vehicle can be returned and the fleet vehicle can get back to work.

Saving this time is saving real money. Depending on the type of vehicle, an hour of downtime can cost a company an average of $150.

3. Know When to Pull the Plug

At a certain point in the lifespan of a vehicle, it’s going to start to cost more to maintain than it’s worth. But identifying that turning point is tricky. It’s human nature to want to squeeze as much out of you can of a vehicle, but that really doesn’t make the most financial sense.

Companies can implement technology that will analyze a vehicle’s age, mileage, maintenance history, total downtime, availability of rental replacements and how integral the vehicle is to the operation of the company to create a ranking system. By customizing this analysis to sync with your fleet’s priorities and your broader business goals, it completely takes the guesswork out of when to sell a vehicle.

For those who aren’t as technically savvy as they’d wish to be, stepping into the world of Big Data can be intimidating. But the financial benefits that can come from closely monitoring your fleet and then taking corrective action can result in a tremendous cost savings that enables your company to invest in other parts of your business.



Lessen the Liability Tony Candeloro headshot




Tony Candeloro is vice president of product development and client information services for ARI, one of the largest fleet management companies in the world with nearly 1.5 million vehicles under its watch. ARI partners with companies in the food and beverage industry and beyond to allow them to turn fleet data into cost savings. For more information, visit www.arifleet.com.


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