Fleet management is a core part of any fleet. It might surprise you to hear that outsourcing fleet management can produce superior results to in-house management. Outsourced fleet management teams are highly skilled, have access to top tier talent and technology, and experience working in the industry.
In this article, we will explain what fleet outsourcing is. In addition, we will outline six advantages to outsourcing fleet management including lower operating costs, liberate internal resources, provide better customer experience, mitigate risk, tap into valuable resources and knowledge, and access to specialists.
Finally, we go over three benefits to outsourcing fleet maintenance including how it’s cost-effective, can help your fleet mitigate maintenance risks, and lets your fleet access experienced mechanics.
What is Fleet Outsourcing?
So what exactly is “fleet outsourcing?” Outsourcing fleet management responsibilities can be summed up as delegating some of a fleet’s management jobs to a third party. This could involve monitoring and improving driver behavior, managing a planned maintenance program, or even utilizing a provider’s in-house fleet maintenance software in order to manage inventory and work orders.
The key thing to understand is that when you outsource fleet management an offsite organization oversees your fleet’s practical day-to-day operations. Many in the industry believe that fleet outsourcing is superior to in-house management and that outsourcing fleet management is going to become very popular in the next few years.
6 Advantages of Outsourcing Fleet Management
1. Lower Operating Costs
Fleet management can get expensive. Outsourcing fleet operations can significantly reduce the costs associated with the management of a fleet. In addition, outsourcing maintenance can lower the costs associated with man-hours required to complete maintenance tasks.
Many third party fleet management organizations can provide fleet vehicle leasing—at favorable rates. Leasing a fleet’s vehicles completely offloads the fleet’s cost of ownership onto the outsourcing provider. Many fleets choose to outsource in order to take advantage of direct cost reductions like this one. Beyond this example, there are many ways fleet outsourcing can help your fleet tap into longterm cost savings.
2. Liberate Internal Resources
Often fleet management services are able to handle the processes of your fleet more efficiently and faster than your internal team can. This gives your team the freedom to shift their attention to other pertinent business activities.
Many businesses outsource both fleet management and maintenance services in order to free up internal resources (including both financial and human). This increases a fleet’s overall productivity by freeing up resources to be utilized for other income-generating activities.
3. Provide Better Customer Experience
One of the advantages of outsourcing fleet management is that it enables businesses to take total control of optimizing their customer experience. In addition, it can let companies improve their relationship with their customers. When management tasks are delegated, there is more time to invest in improving the customer experience.
4. Mitigate Risk
It can be challenging for fleets to navigate compliance regulations and industry standards. External influences like constantly shifting legislation make it even harder. Outsourcing can eliminate the stress felt due to compliance.
Fleet management services have processes and procedures in place to ensure compliance. They utilize tools such as fleet management systems to keep your fleet organized and within regulations. However, remember that if things do go wrong the accountability is still on you.
5. Valuable Resources and Knowledge
Outsourcing fleet management lets fleets tap into exclusive systems, tools, and knowledge that was previously unavailable. These tools and procedures, such as specialist fleet management software, can help keep your fleet running efficiently.
Top tier third party fleet management organizations often have access to market intelligence. This information can be used to benchmark your fleet against the average and find areas to be improved.
6. Access to Specialists
One of the advantages of outsourcing fleet management is that external fleet management companies often have access to specialists with extensive experience working in the fleet industry. These specialists can help your fleet implement best practices and find other ways to improve and streamline your fleet’s processes.
Bonus: Benefits of Outsourcing Fleet Maintenance
Outsourcing Fleet Maintenance Is Cost-Effective
Generally, it is more cost-effective to hire a professional fleet management company than to build a custom maintenance shop from the ground up. Running your own shop can get expensive. You are on the hook to pay for health benefits, your mechanics’ overtime, and all the other expected employee expenses. Outsourcing fleet maintenance eliminates all of these extraneous expenses. When you outsource fleet maintenance you get charged one predictable fee a month.
One of the advantages of outsourcing fleet maintenance is being able to capitalize on the experience of expert mechanics. Most reputable outsourced fleet maintenance companies have mechanics with up-to-date certifications and extensive training on all sorts of vehicles. In many cases, your vehicle will receive better care (and will last longer) with outsourced fleet maintenance.
Mitigate Maintenance Risk
Garages are inherently dangerous working environments. Having a garage opens your fleet up to expensive workplace injuries and lawsuits. How can you be sure that employees are following OSHA regulations? Training technicians and ongoing safety programs take up time and cost the fleet money. Outsourcing fleet maintenance reduces your risk of exposure to workplace accidents and lawsuits. It can potentially save fleets large sums in avoided litigation.
There are many benefits to outsourcing fleet management and maintenance. It may seem counterintuitive to outsource such a core part of a fleet. However, outsourced fleet management companies have proven themselves as highly efficient, cost-effective, and able to produce stellar results. To learn more about fleet management, smart software solutions, and easy ways to boost fleet performance be sure to check out all that Azuga has to offer.