How businesses can save money on their fleet costs

In the face of rising energy costs and other inflationary cost pressures, continuing supply chain frustrations and the threat of an economic recession, businesses must take control of their finances where they can.

We offer a range of practical tips for those managing drivers and vehicles within their businesses:

Fleet insurance

When calculating insurance premiums, providers take various risk factors into account to determine how likely it is that you will need to make a claim. Some things that could help you to save money at your next insurance renewal include:

Higher Deductible

Offering to carry a higher deductible on your policy could lower the premium as you agree to contribute towards the cost of any claim. For example, by offering to pay the first $1,000 or $2,500 on any claim, your broker and insurance company should be able to provide an option for a reduced premium.

Risk management

Show your commitment to risk and road safety by demonstrating how you are managing your fleet risk.  This could include aspects such as:

• Vehicle storage- Where are vehicles kept at night or when not in use? Are they safe and secure?
• Vehicle security- Do the vehicles have any additional security, such as alarms and trackers?
• Cameras- In-vehicle cameras help determine liability following an incident and defend fraudulent claims. They can also improve driver behaviour.
• Vehicle checks- Do you carry out daily vehicle checks looking for defects that could potentially lead to an incident?
• Documentation- Detailing company procedures, Health & Safety policies and having a Driver Handbook help demonstrate a positive risk management culture.
• Driver training- Is there evidence of ongoing driver training / coaching to instill a road safety mindset?
• Incident reporting- Is everyone aware of what to do in the event of an incident, and the need to report incidents as soon as they happen?

Mitigating future claims

This is not a strategy which will influence the premium at your next renewal but rather is a long-term approach to reducing your insurance premiums.  Generally, if your organization has had good number of fleet claims over the last 5 years, work with your broker and insurance company to analyze the root causes of these claims and consider/implement strategies to mitigate similar claims going forward. As the claims experience of your organization improves over time, you’ll be rewarded with better insurance premiums in turn.

Improved fuel economy

Experienced fleet managers will know that changes to driver behaviour can lead to significant savings, so driver education is a valuable tool. Areas of focus could include:

Driving style - Talk to employees about their driving style. Aggressive driving, over-revving and late braking all use more fuel. Smooth acceleration and braking, combined with moving up through the gears as soon as possible, saves money.

Watch your speed - Speeding carries the risk of a fine and points on your licence but it also uses more fuel. For example, driving at 128/kph can use up to 25% more fuel than at 112kph.

Eco mode - Some vehicles have different drive modes, including eco-mode for greater fuel efficiency. Familiarize staff with how and when to use them.

Tires - Ensure that vehicle tires are always inflated to the correct pressure. Alongside enhanced road safety, this will also reduce tire wear and improve fuel consumption.

Embrace technology - Vehicle telematics and driver management systems can identify problem areas and improve driver behaviours, leading to better fuel economy and fewer driving offences, incidents and insurance claims.

Route planning - Effective journey planning to avoid traffic can result in less idling in traffic and more efficient driving.

Avoid obstacles - Anticipating traffic lights, roundabouts, pedestrian crossings and other obstacles allows drivers to ease off the accelerator and keep moving, with fewer stop-starts.

Read the road - Planning ahead and using gravity to build up momentum when going downhill will help you travel uphill with less accelerating and less fuel. Smooth progressive driving also helps reduce the risk of being involved in a collision. Anticipating hazards and using acceleration sense (varying the vehicle’s speed in response to changing road or traffic conditions) can help to reduce fuel usage, cause less tire wear and reduce carbon emissions.

Filling up

Check prices – Driver should keep in mind that prices at the pump can vary dramatically between providers and will be more expensive at highway service stations.

Fuel cards - Consider issuing company fuel cards to make it easier to fill up, monitor spending and manage fuel expenses efficiently.

And finally…

Suggestions welcome - Encourage employees to come forward with suggestions for ways to save money. Maybe offer a prize for the best ideas!