Sam Sterry, SME Sales Director, Europcar Mobility Group UK explains why ownership might not be the best option for commercial van business users.
Despite the economic uncertainty over the past couple of years, it appears business confidence is quietly on the rise. At the beginning of last year, the latest government statistics showed the number of UK businesses in the private sector was on the rise; at the start of 2019 it was 5.9 million, an increase of 3.5% (+200,000 businesses) on 2018 figures. And the culture of entrepreneurship means there are now 2.4 million more businesses than in 2000, an increase of 69% over last two decades.
Whether they are sole traders or small businesses, it is probably safe to assume many of these new enterprises require vans. Tradespeople have been benefitting from the flurry of building and construction happening around the country and with internet sales now accounting for over 20% of retail purchases, there’s been a surge in courier businesses starting up too.
The increase in businesses requiring vans is further supported by the latest Society of Motor Manufacturers and Traders (SMMT) figures , which show there were 365,775 new vans registered last year, a 2.4% increase on 2018 figures. And the latest SMMT figures show new van registrations have grown for the second consecutive month, up +5.9% in January, with small and mid-sized vans, dominating the market.
But is vehicle ownership the right way to go for new and small businesses? Regardless of whether you are a sole trader or small business relying on a van or fleet of vans for your livelihood, van ownership comes at a cost, in terms of both capital investment that can restrict cash flow and administrative burden.
And for those with a sustainability agenda, with the rapid pace of vehicle technological advances, businesses with long-term commitments run the risk of being left behind as vehicles become more fuel and environmentally efficient.
And it’s not just about cost savings and sustainability. There are also immeasurable benefits that modern vehicle technologies deliver such as enhanced safety features and greater productivity. A new van keeps employees safe and makes them feel valued.
There are genuine cost-effective alternatives to ownership for businesses dependent on their vans which is why, with tax benefits and the ability to spread costs over a period of time, business owners really should be looking at other ways to access the mobility they need. And one option that should be given serious consideration is rental, whether short-term for the occasional need or longer-term.
Van rental means the latest, most technologically advanced company vans can be rented, and with short, mid or long-term contracts available, contract terms can be mixed and matched depending on requirements.
It’s also worth working with a provider that offers delivery and collection services. At Europcar Mobility Group UK for example, because we have 100% coverage of the UK, we can deliver vehicles with as little as two hours’ notice from booking.
But the support to businesses that van rental services can deliver goes beyond just supplying vehicles when they’re needed.
The other factor business owners need to consider is vehicle downtime. And to address that challenge, it’s important to understand the servicing and maintenance options available from vehicle suppliers. Included in all the Europcar van hire options is servicing and maintenance, and 24 hour recovery. And that means as well as the business not being faced with unexpected costs, owners have peace of mind that drivers are in safe, reliable vehicles and are supported in the event of an emergency.
Our partnership with quality service providers, such as bespoke Service, Maintenance and Repair (SMR) service provider Rivus Fleet Solutions, ensures Europcar Vans have access to an extensive UK network of garages and mobile technicians for its ever-expanding fleet of core and specialist commercial vehicles. This maximises availability and ensures a seamless level of service for our customers.
We have found access to this comprehensive network has significantly enhanced the level of service for businesses using Europcar AdVANtage long-term rental. And the mobile units have played a particularly valuable role in ensuring there is as little disruption as possible to mission-critical vehicles, keeping down-time to a minimum.
Data analysis of the first six months of our partnership show there have been 82 call outs for the service, of which 77 were answered by the Rivus mobile units and 5 handled at the Rivus workshops. Crucially, the accessibility to the Rivus network has seen a 20% reduction on average in vehicle downtime for Europcar Van customers.
Whilst there definitely seems to be a mood of optimism as we enter the new decade, there’s no question that challenges balancing business productivity and growth with good cash flow management remain. Staying flexible – particularly when it comes to business mobility – is, therefore, the watchword for many organisations.