Did you know you can make a real difference in operational efficiency, lower asset costs, reduce vehicle and equipment downtime, and increase employee and customer satisfaction by employing several fleet management best practices?
Asset management is more than just having a fleet; it focuses on the complete lifecycle or each piece of equipment. If this is not your area of expertise, we’ve got you covered with tips to help create an effective asset management plan.
Selecting the Best Assets
The first step in this process is to go fact-finding; this helps determine the fleet and equipment needs. Involving relevant department leaders and actual operators in this discovery process is helpful to reveal how both are being used and should be used.
Gathering greater insight is essential to figuring out the cost of using a particular asset: What is the carrying capacity of a vehicle? Can a specific piece of equipment be worked on by the team? Is more training required, or are more employees needed? All these questions add to the cost of using the asset.
Also, focusing on essential features and needed capabilities in fleet equipment can lead to more effective choices. Selecting the best engine and fuel type can lower costs, improve fuel economy, and reduce CO2 emissions as part of a company’s sustainability efforts. Additionally, making safety a part of any decision can lower the potential for accidents.
Once you’ve got the best vehicles and/or equipment in place, the next challenge is reducing downtime and keeping them in service.
Although it can be challenging to calculate vehicle downtime costs, consider the industry average of $1,000 per day for each vehicle not running. Out-of-service equipment not only increases costs but is also a cause of revenue loss. This drives up employee frustration, increases turnover, and creates a drop in customer satisfaction.
That’s why it’s vital to identify asset management challenges that can have vehicles and equipment out of service; this gives you a better understanding of best practices that can lead to company-wide improvements and optimal efficiency.
Unscheduled downtime for repairs also needs to be addressed. Should a group of vehicles be out of service due to specific parts failures or driver-related issues regularly, having the ability to manage inspection, maintenance practices can lead to measurable improvements in utilization. Additionally, adopting a solution that allows the ability to monitor driving behaviors can also extend the lifecycle of the fleet.
There’s no one-size-fits-all solution to finding the most effective replacement for assets and equipment. There are many things to consider unique to each business, such as vehicle mileage variances, purchasing process, current financials, incentives for new purchases vs. leases, projected maintenance, and the resale value of the used asset.
To successfully assess whether a flexible asset and equipment replacement strategy could have a longer-term benefit, consider new alternatives like extending or reducing vehicle and asset lifecycles or using short-term rental programs to meet specific operational needs.
Why not consider alternative options such as relocating out of commission higher mileage vehicles with low operating and maintenance costs to other parts of your operation?
No matter if you are considering buying, financing, or leasing your fleet operation’s vehicles and equipment, an adequate replacement program can go a long way towards lowering your company’s overall cost of doing business.
Now it is time to analyze the total cost of assets in your business throughout the complete lifecycle to give you a financial picture that leads to the most cost-effective choices.
This information strengthens your asset management process and can early address weaknesses and challenges. Drill down into costs of the vehicle, needed equipment, maintenance overheads, parts, fuel, and the actual drivers to better understand everything from acquisition to disposal of vehicles and equipment.
Understanding and managing the total cost of ownership leads to a more productive, cost-effective operation that will meet your efficiency goals.
Processes & Reporting
Solving asset management challenges requires a consistent process and real-time data. This makes it easy to reach better and more responsive decisions; this is where fleet asset management software shows its value.
Advanced integrated enterprise asset management software solutions can provide a means of considering all of the factors about operations and costs you need to know to make the best business decisions. These solutions drive the development of reports that will provide the insight you need to optimize the use of your assets effectively.