Fleet management can seem a broad and all-encompassing term. Even the definition can vary by person and business. Some businesses who own and lease vehicles may not even use the term ‘fleet management’ to describe their vehicle procurement, maintenance and management processes.
In this article, we answer the question, what is fleet management and provide you with information to determine what tools will assist you in effectively and efficiently managing your vehicles.
To kick it off, let’s start with the basics.
What is a fleet?
A fleet is a group of assets owned or leased by the same company. These assets can come in many forms from ships, machinery, and aeroplanes, to trucks and light passenger vehicles. Examples of a fleet of vehicles include taxis, couriers, police cars and car rental vehicles. The individual vehicles that make up the fleet are simply known as fleet vehicles.
How many vehicles are in a fleet?
There is no fixed number, but as a general rule, any organisation that operates two or more vehicles can consider themselves fleet operators. However, for fleet insurance eligibility, at least three to four vehicles are required.
By our definition, there are two main fleet classifications:
Small fleets: Fleets that comprise 5-50 vehicles. An example of a business that operates a small fleet could be a family-run trades service.
Enterprise fleets: Fleets that comprise of more than 50 vehicles. An example of a business that operates an enterprise fleet could be a large courier company or a mine site.
What other types of vehicle fleets are there?
Small or Enterprise fleets can be further categorised into mixed and grey fleets.
Mixed Fleet – A fleet is a mixed fleet when it’s made up of different types and classes of assets. This can include a combination of vehicles, vans, machinery, buses and trucks, as an example.
Grey Fleet – A grey fleet is specific to personally owned or leased vehicles that are used for work purposes, be that regularly or on occasion. When a personal vehicle is used for work, the employee’s company becomes liable. This is because a vehicle is treated as a ‘place of work’ under the Australian and New Zealand Workplace Health and Safety Acts.
What is fleet management?
Simply put, fleet management is the process of managing the operations, safety, compliance and productivity of the fleet as a whole, the individual vehicles and their drivers. Companies may adopt different methods, tools and systems to assist them with this process, which may vary based on the size and type of fleet.
Why do fleets need to be managed?
Fleets, like any company-owned or leased asset, require regular management to ensure performance, revenue generation and lower depreciation-related capital costs. Fleet operators also need to ensure the vehicle is roadworthy and safe. In addition to ongoing management, fleets require accurate record-keeping and compliance management, be it taxes or other legal regulations, to be profitable.
Since managing a fleet of vehicles is a complex task, many companies use automated fleet management systems and software to assist them with this process.
Who should manage a fleet?
Depending on the number of vehicles owned by a company, it may employ a dedicated Fleet Manager. The Fleet Manager is quite often responsible for vehicle procurement and maintenance, driver behaviour and training, route tracking and planning, and the implementation of programs that increase productivity and decrease costs. Alternatively, and what is quite often the case with businesses with less than 50 vehicles, vehicles are managed by any number of people from procurement, to the general manager, an administrator or an OH&S professional. In these instances, these people wear many hats, and fleet management is just one part of their busy day. These businesses need a different set of tools to manage their vehicles effectively.
What does a Fleet Manager do?
Managing a fleet can be a complicated job as it involves many moving parts. It can require constant tracking and monitoring of fleet vehicles to ensure efficiency, usage and steady return on investment.
The tasks involved in fleet management include, but are not limited to:
- Accident and incident management
- Driver safety management and driver training
- Fleet management strategy
- Fuel management
- Fringe benefits tax (FBT) reporting
- Liability, insurance and compliance management
- Procurement and disposal management
- Registration and infringement management
- Roadside assistance
- Tollway management
- Vehicle servicing and maintenance
What is a fleet management system?
Owing to the complexity of fleet management, many companies have moved away from traditional analogue tracking and reporting, like, using paper exercise books to log fuel consumption and odometer readings, or using stickers as visual reminders to next service each vehicle.
With the rise of software-as-a-service (SaaS), mobile apps and subscription-based services, businesses have the option to automate their fleet management operations. Nowadays, sophisticated tools like automated fleet management software can minimise a fleet operators time spent on administrative tasks to focus on what’s important; improving efficiency, fleet performance, and cost-effectively managing compliance-related issues.
Fleet management systems can be plug and play or integrate with almost any third-party data provider or business software. Fleet management systems streamline processes, such as servicing scheduling and driver behaviour management and makes vehicle usage and FBT reporting easy. Such software removes the burden of administrative and repetitive tasks and improves overall time management.
How can your business benefit from a fleet management system?
As a recap, fleet management is the process of managing the operations, safety, compliance and productivity of your vehicles as a whole, the individual vehicles and their drivers. The purpose of a fleet management system is to collect, collate, and make sense of all this vehicle data through an easy to use web or mobile app, or an API that feeds directly into your company’s existing business software (e.g. CRM system), or technology stacks. This system is designed to optimise and automate your fleet management processes and programs, and to reduce the administrative burden of managing vehicles used by your organisation.
Is a fleet management system right for my business?
Considering the benefits and cost savings that businesses can accrue from a fleet management system over time, it becomes a useful and essential tool for any type and sized fleet. It doesn’t matter if your business operates a fleet of five or 50,000 vehicles, a fleet management system can make it far easier for you to manage your fleet.
How do you choose the right fleet management solution for your business?
Every business has different needs, and it’s important to find a system that caters to your individual business needs and sits within your budget. Most fleet management solutions in the market today offer a range of services and features. The best fleet management system is one that is flexible and scalable. It can streamline processes, such as service scheduling and driver behaviour management, and makes vehicle usage and FBT reporting easy. Such fleet management systems remove the burden of administrative and repetitive tasks and improve overall productivity and time management.
Often a fleet management system comes with a rich and complex features list, many of which may not be relevant or used by your business. Find a system that works for you and is customisable. Engaging a provider who allows you to choose and pay for only the features you need will help reduce your costs.
The following was originally published by Intelematics and has been republished with permission.
