Fleet software in the news

Fleet World December 2009

Software and Fuel cards

Keeping fuel costs under control

The cost of fuel - whether petrol or diesel - is an increasingly significant expense for fleets and high on their agendas when cost-cuttings are under consider­ation. KEN ROGERS asks the software experts and fuel­card companies how their systems and products can help provide management with an in-depth overview of fuel activity - and most important - save costs.

Meryl Gilbert, business development director - fuel at Arval, says that in order to reduce fuel costs in a sustainable way, it is crucial to understand current expendi­ture so that realistic reduction targets can be set. 'Fuel card data provides the best means of building this picture, setting fuel management objectives and tracking per­formance against them.'

She adds that fuel card data should underpin a clear fuel policy that address­es rules to reduce both fuel volumes used and expenditure. 'Making drivers accountable and giving the fleet manager the ability to track individual activity makes it more likely that drivers will adhere to these rules, and if they don't at least they can be identified and corrective action taken.

'Significant savings can come through utilising fuel card information to initiate a policy of purchasing fuel at a lower price. For example, the fleet manager - in conjunc­tion with the information provided by their fuel card supplier - can set a price-per-litre target which drivers aim to meet when they fill up. As long as it doesn't mean deviating from their route, drivers will often be direct­ed to lower priced forecourts as a means of doing this. While the savings can vary, a fleet fully committed to this strategy can remove around 10 per cent of fuel costs.'

Neville Briggs, managing director, CFC Solutions, stresses that fuel is an area where fleets should arguably have been taking proactive management action for a long while - firstly because of rapidly rising petrol and diesel prices seen during 2008, secondly because of the cost pres­sures of the recession and thirdly because fuel prices rise well above inflation over time and will continue to do so.

'Despite this, many fleets - perhaps even the majority - are guilty of ignoring the key tools that are available to take control of fuel costs and which are proven to allow companies to minimise costs. The main way in which fleets can actively manage fuel expenditure is to issue fuel cards to all their drivers instead of allowing them to buy fuel on company credit cards or reclaim through receipts. Fuel cards allow you to immediately put a number of impor­tant controls in place. You can specify what is being bought on the card, where it is being bought and for which vehicles. These are strong, basic, control measures.'

Jason Francis, managing director, Jaama, says: 'If you can't measure it; you can't man­age it. After vehicle depreciation (acquisi­tion/disposal), fuel is the second largest cost facing all fleet operations. Actual fuel savings from the introduction of our Key2 Vehicle Management software are different for each customer. However, the main area of savings is in being able to identify low MPG against expected MPG drivers, poor performing vehicles and fuel theft. In our experience, a customer with more than 100 vehicles stands a good chance of being the victim of some fuel theft. Customers have reported fuel spend reductions of up to eight per cent after implementation from a combination of savings in these areas.'

'A good system will monitor, control and reject erroneous expenditure and provide automated checks and balances to make sure that processes are operating as intended and within predefined param­eters without the requirement for some­one to intervene and run manual checks.'

However, while there is undoubtedly a financial return on any investment in Key2, there are significant benefits in other areas, explains Mr Francis. 'These include a major reduction in administra­tion through automation and on-line records which means time saved on check­ing invoices and fuel receipts can be devot­ed to other tasks. Our customers often tell us that their investment is recovered with­in the first year many times over with thousands of pounds saved.'

Ashley Sowerby, managing director of Chevin Fleet Solutions, says that the extent to which companies influence and maximise on their fuel consumption is down to a software solution that accu­rately disseminates data in correspon­dence with KPls (Key Performance Indicators). 'FleetWave, Chevin's fleet management software system, does exactly this. By automatically importing the most up-to-date "live" vehicle mileage data, taken directly from information contributed by fuel-card suppliers and black box tracking devices, opportunities for inaccurate or false data input are eliminated. This alone has the potential to save over £100,000 on a medium-sized fleet of around 100 vehicles. Not forgetting the countless hours of administration that are avoided.'

FleetWave assimilates data to expose low MPG rates and other inconsistencies enabling managers to tackle fuel bills effec­tively. Encouraging drivers to be economical by switching off the engine when stationary, sticking to the limit on motorways; regular­ly checking tyre pressures; and only having the air-con on when necessary dramatically reduces consumption over an entire fleet.

'The savings can be extraordinary: said Mr Sowerby. 'Over £30,000 on a fleet of 150 vehicles simply by raising fuel efficiency from 30mpg to 33, a by-product of which is, importantly, lowering C02 emissions.'

John Wisdom, group sales and marketing director, Cybit, says that telematics vehicle tracking combats rising fuel prices by help­ing fleet companies increase the efficiency of vehicles. Organisations can use location and driver performance information to dra­matically cut their operational costs.

'Tracking vehicle activity enables busi­nesses to see where every part of the fleet is being used inefficiently. Businesses can use precise reports to implement best practices and meaningful business changes that can generate immediate and significant cost savings. The balancing act for businesses today is taking as many miles off their vehi­cles as they can - while still maintaining the same levels of service that their customers are used to.'

By way of an example, Chevin says that every mile that an HGV driver covers on the road costs a business around £3.00. In the case of such firms, if this figure was extrap­olated across a whole fleet, it becomes easy to see how they can immediately cut opera­tional cost. Mr Sowerby says: 'If businesses can cut the distance that their drivers travel by ten miles each day, every single vehicle will reduce its fuel costs by £150 per week or £9,000 per year. A fleet of 50 can save almost £1-2 million per year.'

Of course, these savings aren't just con­fined to HGV fleets and company car opera­tors could also see real cost benefits to rationalising vehicle activity.

 

About Jaama

Jaama is a fleet software and occupational road safety specialist. As a certified Microsoft® development partner, Jaama uses the latest technology to provide customers with greater integration, control and automation. It brings innovative vehicle management software to fleet operators, contract hire and leasing companies. And Jaama is the first to combine fleet management software and risk management services to help customers meet their driver health and safety responsibilities under occupational road safety regulations.

http://www.jaama.co.uk


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