There is no small business owner in the world that is not interested in ways to increase cashflow and cut down on expenses. Having said that, there are also plenty of tips and tricks to consider. But how can you know which ones will work for your company? The answer is, research, as you contemplate how to shift expenses around, make sure you are not doing so on a whim. Think about your specific industry and ask yourself if the strategy you are considering makes sense for fleet businesses specifically.
Of course, there will always be general ways, but sometimes those larger ideas do not lead to significant results. You should really start with understanding where and what you are spending on in detail. Think about where your money is going, and how you can better direct it. It is not going to do you any good to consider a tip like, decrease office space, for example, if that is not one of your most mismanaged expenses.
You need to know where your money is going, yes, but you also need to quite literally see where your fleet is going too. You can utilize fleet telematics for technology that goes beyond just GPS tracking to create an environment that gives you the best visibility and opportunity for analysis. Once you spend some time with this software you will be able to see where your drivers might be making decisions that affect your bottom line. In many cases, they might not even be making these decisions intentionally so using these types of programs can be enlightening for everyone involved.
In terms of how this can help you trim down expenses, even things like optimizing for the best route, can save on fuel costs. It does not matter if your fleet is two cars or two hundred cars, if they are burning up unnecessary gas, that is also going to burn up your profit margin. These programs can also help detour drivers from construction areas or inclement weather conditions that can increase wear and tear on vehicles and lead to repairs that may have been avoidable.
As you do a deep dive into where your business is spending money and where you can cut costs, think about the common denominators. Company cell phones are a great example. If every person on your team has a cell phone, and you are not exploring ways to reduce smartphone costs, then you are overspending one amount, times however many cell phones are on your corporate policy.
Make a list of all of your expenses that are multiplied. So instead of having a budget line item of ‘smartphones’ show what those costs are broken down individually. This will also give you incentive to understand that even if you are only able to shave $5, per se, off each phones plan, multiplying that by the total number of plans can create a huge saving for you each month.
When you operate a fleet business and there are several spending consistencies that cannot be avoided, find opportunities to get some perks where you can. Fuel spending is a great example. You can’t avoid putting gas in your vehicles, so why not join a program that provides you with discounts or a points system that you can take advantage of to help manage costs?
Maintenance is another awesome example. Shop around for things like mechanics and car washes. Of course, you need to trust your service providers and want to make sure that you are getting quality products and services, but sometimes discounts exist in places you would not even realize unless you asked. Many body shops will offer discounts if you sign your fleet up to their loyalty program. So, by agreeing to the terms of that agreement you could potentially be saving yourself thousands of dollars on services. Car washes typically run similar specials. Even if they do not have a designated fleet loyalty opportunity, chances are they offer discounts for buying in bulk. Since you know that you are going to need your fleet washed often, consider buying monthly passes and increasing your frequency instead of paying per wash and attempting to control costs by going less often.
Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.