By Thore Vestergaard, SVP and MD, Commercial Cards, FLEETCOR
Running a fleet of business vehicles is a major cost for UK SMEs. In times of economic uncertainty, with Brexit and the UK’s productivity conundrum all playing their part, rising costs are likely to keep going on an upward trend. As a result, SMEs are coming under increasing pressure to better streamline their operations and reduce excessive costs.Fortunately, there are a number of proactive steps SMEs can take to better manage the costs associated with fleet vehicles which are outlined below.
Choose the right vehicle for your businessFirstly, your vehicles need to suit your business’s needs. When leasing or purchasing a vehicle, keep in mind its running cost per mile, as this can creep up for larger vehicles or older models, even if they are cheaper to buy. You need a fleet that is fit for purpose, not one which will increase costs over time.
Fuel cards offer savings and convenienceOpting for a fuel card will go a long way to streamlining costs. Many offer discounts on fuel at the pump, and these can also help those responsible for an organisation’s fleet to control costs on other expenses related to business travel that individuals incur, like subsistence and hotel stop overs. The card offers freedom to employees and cost control for employers.
A well maintained fleetRemember, dirty engines use more fuel, while tyres that are worn or at the incorrect pressure can negatively affect how quickly the car accelerates, resulting in the motor having to work harder. Ultimately, a well maintained and serviced vehicle will save you money in the long run.
Make reconciling tax returns painlessThe HMRC’s new Making Tax Digital initiative works to make it easier for businesses to submit tax returns online. Under the scheme, tax will be collected in as close to real time as possible, so SMEs will not have to wait for one substantial bill at the end of the year.
When it comes to the management of a fleet, intelligent fuel cards can also play their part in taking the pain out of tax, providing an HMRC-compliant audit trail. This saves SMEs the time of trying to piece together the relevant information when it comes to submitting tax returns, and means they can concentrate on more strategic matters.
Listen to your technologyHelp your drivers to get from A to B in the most efficient way possible by combining telematics and travel management information. This can highlight the most cost-effective routes for driving. It can also identify which drivers have poor motoring skills, which can ultimately have a detrimental impact on fuel efficiency.
There are things SMEs can do to educate their drivers when it comes to improving their driving technique while on the road. These include providing training programmes, or offering incentives and rewards for high standards of driving – the ultimate aim being to get each and every person who drives your organisation’s fleet vehicles to change their behaviour and think about cost efficiency while using company vehicles.