20% of businesses fail in the first year. After 5 years, this percentage reaches 50%; and after 10 years from the beginning of the activity, only 30% of the companies still manage to remain on the market. How does Fleet Management affect this statistic?
This means that in the course of 10 years, most companies close their doors.
But more than half of them have a slow end, which is approaching with each unresolved issue and each unaddressed situation.
These situations are very varied and occur in all departments of an organization.
Therefore, in this article we will turn our attention to 4 of the biggest mistakes made in fleet management.
If untreated, they will lead slowly but surely to higher and higher costs and eventually to the closure of the company.
Mistake # 1: You do not monitor Employee driving style.
Many people would probably say “so what?”. This is where the real problem lies.
People who overlook the conduct of their employees do not think about the really important things that affect performance in their own company. Let’s suppose you own a large appliance repair service company.
This is what will happen if any of the technicians from your company exceeds the legal speed limit by a large amount and / or very often:
First of all, he will definitely lose his driver’s license for at least a while.
Then, when this happens, for a while you will have an employee who will not be able to perform his duties.
Here you will have to make a decision: Continue the activity without a person; which will decrease your company’s productivity; or hire an extra technician to handle all the demands, knowing that doing so will increase your operating costs.
This is probably the smallest problem that can arise. But there are even worse things. For example, by exceeding the legal speed limit, your employees will be at high risk of an accident.
They risk their lives, and in case of personal injury or death, there are certain repercussions.
Even if it was the employee’s fault, you will have to go through several legal steps.
For example: you must report what happened to the authorities and, in order to not pay compensations, you will have to prove that it was not your fault; considering that the accident happened during the working hours.
This report will be forwarded to the authorities; and this will most likely start an investigation in which you will have to participate.
Then there are the material losses.
Let’s say that the accident happens to a vehicle transporting goods.
In this case, the goods transported will be damaged, and you will be unsellable. And should I mention the vehicle that took part in the accident?
At best you will need to repair it. Instead, there is the possibility that the car will be so damaged that it can no longer be used.
Mistake # 2: You don’t know when someone uses a vehicle.
How can you know, without the help of a proper GPS Tracking System, whether the vehicles in your company are used or not?
The most inefficient option is to hire guards and station them in your company’s parking lot. However, even this cannot protect you from uncertainty.
If you are not being notified when someone is starting or stopping one of your vehicle’s engine, then anyone can use it without your knowledge. At that moment, anything can happen.
Someone can drive your car to a more remote area and then fuel can be stolen directly from the tank.
Also if someone outside your company manages to access one of the cars, that person will easily be able to steal either components or the entire car.
You might even lose that car forever.
Although, in our day, the authorities have access to a multitude of ways in which they can recover stolen goods, the success rate is not 100%.
Thus, no one can recover many stolen goods.
Even if you will eventually be able to recover the vehicle, at least for awhile you will have to carry out your activity without that vehicle.
If someone takes out only a few components from the vehicle, then you will need to repair it.
Thus, you may notice that there is a cost of time and a cost of money, if you do not install a system that will alert you when your vehicles are being used.
Mistake # 3: You don’t know if your vehicles stand still with the engine on.
What happens when one of your sales agents visits potential customers and decides that after one visit he feels too tired to go to the next?
Most of them take decent breaks, maybe they sometimes stop to buy a coffee from one the nearest shop they can be find in the city. Or if they are out of town, there is also the option to take a quick cigarette break.
But there are also people who think they have worked too hard and deserve to relax for a longer time. The most convenient option for such a person is of course parking the car in the shade of a tree and waiting to regain his strength for the next sale.
For these employees, it does not matter that they wasted 1-2 hours of the work schedule (excluding lunch break) because they always have an explanation at hand. “They faced heavy traffic” or “one of the meetings was longer than they expected”.
While taking this break, the agent must keep the engine running, because it might be too cold or too hot inside.
What is certain is that in such situations agent burn fuel while standing still; which is not very profitable for the company in which this kind of an exemplary employee works.
There don’t even have to be many people like this in the company. If only 20% of your employees do this, then a significant portion of the company’s budget.
Mistake # 4: You don’t notice if vehicles go out of set borders.
As I mentioned earlier, the fact that you can’t know what’s going on with your vehicles is a big inconvenience.
The biggest risk is the theft of goods from your company. This can happen even when someone uses the vehicles for the activity you bought them to do.
For example, if you bought a fleet of cars in order to rent them; then you probably don’t want them to cross the country’s border.
Earlier, I said that anything can happen when someone uses vehicles without your permission.
This time, the same thing occurs if vehicles get out of your sphere of influence. Unfortunately, once a car crosses certain borders, you will have no guarantee that you will be able to recover them.
However, the problem is not just about the theft of components or entire vehicles.
Let’s turn our attention a little to agriculture.
We do not think it would be very pleasant if at some point you found out that one of your employees would use one of your machines to work on the field of a competitor.
Whenever any of these mistakes occur, they are signs of the lack of flexibility that always leads to the failure of the company.
Every time such a problem isn’t solved, a small crack appears in the company’s structure.
Those cracks start to gather and they destabilize the company until there is nothing left.
We claim that only with the right fleet management systems you can adapt quickly enough when a new situation arises.
This is how you can make your company flexible enough to be successful in the long run.
That’s why we invite you to try out our fleet management system: Nexus GPS Tracking. Click here to schedule a call with one of our specialists!