Building a company fleet can seem like an overwhelming task. Many small businesses don’t realize the benefits of having a fleet or don’t want to spend the money to buy one. However, when you look at the value of a fleet and how it can help you, it’s easy to see why many businesses invest in a fleet. To help you build your company fleet, here are ten simple steps that will help you get started.
1. Determine the Type of Vehicle
The type of vehicle your company will use will depend on the nature of your business. If you are going to be running a courier service, you will need a van or a truck for the purpose. If you are a tour operator, then the type of vehicle will depend on the type of tour you offer and its location. A bus, for example, is ideal for group tours in which many people are involved.
The number of vehicles will also depend on how big your business will be. For example, if you want to run an airport shuttle service, one car would be enough for your company fleet. However, if you’re going to run a courier service or offer tours in different parts of the country and even abroad, it would be advisable that you build up your fleet gradually, starting with two or three vehicles at first.
2. Costs and Budget
The size of your business will determine the type of vehicle you will use. However, if you are getting into the car rental business, you should consider other factors such as insurance, maintenance, fuel, and depreciation costs. The more vehicles you have in your fleet, the higher your costs. So it is better to start small and grow over time.
Concerning budgeting for vehicles, you must set aside a certain amount of money for this purpose. If possible, get a loan from a bank or apply for government grants available in some countries. This will not be enough to cover all your expenses in most cases. Therefore, you must make sure that you have enough capital to purchase the vehicles and take care of other expenses related to running a car rental company.
Still, it would be best to consider the car shipping cost when factoring in the price. If you are buying your vehicles from overseas, you should consider the shipping cost that will be incurred.
3. Inspection and Approval
After purchasing the cars, you will need to inspect them and ensure that they meet the legal requirements in your country. This is usually done by a professional service such as an auto shop or mechanic. Car inspection and approval by the necessary authorities ensure that your cars are roadworthy and have the necessary legal documents such as permits and insurance.
After approval, you will need to register the cars with the relevant authorities. The registration process will depend on the type of vehicle you are registering.
4. Hire a Fleet Manager
A fleet manager’s primary responsibility is to keep track of the accounting and transportation of the fleet vehicles. A fleet manager must also understand how the business works and all the different aspects of it to understand any changes that may happen in the company. Also, a fleet manager must deal with the customers and keep them satisfied. A good fleet manager will be able to provide you with any information you need, help with anything needed, and find ways to save money on your expenses.
5. Purchase a Vehicle Tracking System
A vehicle tracking system will allow you to monitor all of the vehicles within your fleet so that you can keep an eye on their locations at all times. This will enable you to know where all of your cars are at all times, which will help prevent theft and damage from occurring. A vehicle tracking system will also ensure nothing is stolen while in transit or transported by a company.
There are several equipment management tools that you can use to track company assets. Everything from company vehicles, tools, products, and much more can be used to ensure inventory isn’t being misplaced or misused.
6. Invest In a Fleet Management System
A fleet management system (FMS) is an application that allows fleet managers to track mileage, vehicle maintenance schedules, and other essential statistics regarding their fleet vehicles. FMS software also will enable managers to view fuel consumption and maintenance costs by vehicle type or make/model of car. These tools are invaluable for efficiently managing a fleet of vehicles, reducing driver downtime, and lowering operating costs over time.
7. Fleet Insurance
Insurance is a necessity for any business, and fleets are no exception. Many insurance companies offer fleet insurance policies that cover employees, vehicles, and liability. A fleet insurance policy can help mitigate the risk of accidents and damage to vehicles and provide protection against claims of negligent acts or gross negligence.
When looking for an insurer for your fleet, consider the following:
Insurance Company Reputation
A good insurance company will be able to provide good insurance coverage for your fleet at an affordable price.
Ability to Customize
The policies offered by a specific insurer may not be suitable for all types of vehicles or drivers. You may need a policy that specifically caters to your needs and vehicles.
Deductible
A deductible is the amount of money you pay out-of-pocket before the insurance company starts paying claims on your behalf. A high deductible can save you money because you won’t have to pay as much when accidents occur, but it can also increase how much you spend on premiums in the long run if you have many claims in a year.
Claims Process
A good insurance company will provide an easy-to-use claims process and a team of professionals dedicated to handling claims professionally.
8. Regulatory Compliance
Each state has its rules and regulations regarding vehicle registration and car insurance. When building your fleet company, it is important that you understand the laws and regulations that affect your company to stay compliant.
For example, in Texas, you may be required to have a minimum coverage of $7500 for bodily injury liability and $1500 for property damage per person/$100,000 per accident. You will also need to have at least $25,000 in uninsured/underinsured motorist coverage when you purchase a policy. Other states may have different requirements, so you must be up-to-date on all insurance requirements before purchasing policies. Being familiar with regulatory requirements will help you avoid penalties and fines for not having the proper insurance coverage.
9. Set Out Clear Pricing and Working Terms
When building a fleet company, it is vital that you set out transparent pricing and working terms. Pricing should reflect fair market value for the vehicle. For example, if you have a Mercedes Benz X Class, pricing should remember that the car is worth more than $50,000.
On the same note, you should decide whether you are ready to hire employees or hire subcontractors. The payment plans and work contracts should stipulate your expectations in either case.
10. Plan for Maintenance and Repairs
It is important to plan for maintenance and repairs when building a fleet for your company. You will want to make sure that you have enough parts to obtain easily. You will also want to consider how much time will be spent on maintenance and repairs.
If you have a fleet of vehicles with low mileage, this should not be an issue, as you can use your time more efficiently by focusing on other aspects of the business. However, if your fleet has high mileage, it will likely take more time to maintain each vehicle as there is a greater chance that parts may need replacing or repairing to get them back in service.
Conclusively, you will want to do a thorough cost analysis and determine the best way to approach your fleet management. The right way to manage your fleet is dependent on your needs and the size of your company. The best option for you depends on the time you have available, how much money you have to invest and what type of business you are trying to build.
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