7 Reasons for Outsourcing in the Construction Industry
As a construction business, you’ve got a large enough workload on your plate already—building roads, managing commercial infrastructure, managing employees, taking on new jobs, purchasing equipment, etc. When it comes to outsourcing in the construction industry, using third-party fleet services is one of the most cost-effective and resourceful decisions you can make as a business owner. Although it can be tempting to hire a team of in-house fleet managers and mechanics, a third party vendor can easily handle all of your vehicle needs. This helps you scale your business and focus on the important functions that are a better use of your resources.
Depending on your business goals, it may be time to consider outsourcing fleet services for your construction business, starting with these seven key benefits:
1. Free Up Internal Resources
A specialist who handles fleet services and maintenance for a living is more likely to do a better job and complete tasks more efficiently. Every construction business should focus on its core competencies, such as planning and executing projects or coordinating with their partners, like architects and suppliers, to complete their work. Outsourcing fleet services and maintenance means freeing up both financial and human resources so that your company can focus on income-generating activities and boost the productivity of each team member.
2. Reduce Fleet Operating Costs
One of the primary reasons that a construction business may outsource fleet services to a third-party provider is because it is much more cost-effective to do so. You won’t have to hire an internal team of mechanics, purchase fleet trucks, or pay for additional employee expenses such as healthcare benefits. When you use an outsourced team, you can use their resources as needed instead of having to pay a fixed salary.
A third-party fleet services provider can handle a variety of tasks, including maintenance, vehicle leasing, fleet tracking and management, route planning, fuel management, driver and vehicle compliance, vehicle accident management, and much more.
Handling all of these responsibilities in-house will require you to allocate a lot of training, time, and resources, which can be put to better use serving clients. Additionally, working with fleet management providers usually means lower rates and better discounts when it comes to purchasing vehicle parts and insurance policies.
3. Improve Customer Satisfaction
Having a team of reliable specialists and fleet managers can help you improve the quality of service you’re able to provide. For example, when a surge of requests comes in, it can be difficult to predict when there will be enough working trucks available for use. With a trusted fleet service team, you’ll receive regular updates and maintenance to ensure optimal flexibility and reduced vehicle downtime.
Additionally, many fleet management companies offer around-the-clock services to help you in emergencies or other service interruptions. In turn, your clients will receive faster, better service.
With well-maintained fleet vehicles and emergency assistance, your construction company will likely be able to take on more jobs and bring in more revenue.
4. Reduce Risk
Operating a fleet means meeting the standards of many different regulatory requirements. Outsourcing to a fleet management provider will ensure that your fleet can comply with the proper DOT and OSHA laws that are in place.
One of the biggest aspects of reducing risk is monitoring driver behavior. It might surprise you to find that four percent of drivers cause about thirty percent of motor vehicle accidents. To address this industry-wide problem, vendors use fleet management software to score drivers and collect data based on risky driving behavior such as rapid acceleration, hard braking, and speeding. With this information, you can implement better training, require certain drivers to improve their performance, and take other actions to reduce accidents.
5. Take Advantage of Experienced Mechanics
Fleet management companies have a larger talent pool of mechanics to address specific issues when called upon. By using an outsourced fleet company, you’ll be able to draw on the vast expertise of their mechanics. Whether you opt to go with a maintenance or fleet management company, their mechanics will usually have extensive training in all types of vehicles and issues, as well as the most recent certifications. In general it can be very difficult to find a qualified technician elsewhere that has this type of experience.
6. Access to a Wealth of Knowledge and Benefits
Outsourcing your fleet services means that you get access to a wide array of knowledge, tools, and systems that they’ve accumulated. Fleet management companies have vast industry knowledge including market intelligence which allows you to benchmark your fleet performance against other fleets in the construction industry. From there, you can determine areas of improvement and shortcomings that your fleet may have.
7. Access to the Latest Technology and Tools
Fleet providers rely on telematics systems to help them manage your fleet. About 32% of fleets claim that fuel is the largest expense, and 55% of fleets report that telematics has helped significantly reduce fuel costs. If you were to keep fleet management in-house, you’d have the additional expense of acquiring all of the necessary equipment and tools, which may include mechanical and maintenance equipment, fleet tracking software, route planning software, and more.
When you decide to partner with a fleet management vendor, you get to enjoy access to all of the advanced technology and tools that they use without paying for it yourself. Instead, you can reallocate that capital to make investments towards growing your business and better serving your customers.
Fleet management companies provide a cost-effective solution, allowing construction businesses to be more flexible, increase fleet efficiency, reduce risks, and realign company focus. These companies have experience working with varying fleet sizes, and may even have prior experience working with fleets in the construction industry, allowing you to gain invaluable insights.
Check out Azuga fleet management software to help your construction company track your vehicles, monitor driver behavior, and comply with regulations.