Fleet Cost Reduction
The ability to reduce unecessary costs in any business is fundemental in ensuring the proftability of the same and ultimately the survival of that business. The major players within the transport industry are (in most cases) always mindful of cost and invariably as a result of their fleet size are better placed to do something about maintaining a leaner operational structure.
For the smaller fleet operator or those manufacturing companies with small distribution fleets it is a different story. It is inevitable
there will be some inefficiencies and excessive costs within their transport fleet, which is invariably as a result of companies lacking
the time, manpower and expertise to conduct an overall review of their core and non-core cost structure. The adage of not being able
to see the wood for the trees is in essence a reality.
The fact that the smaller fleet operator doesn't have the purchasing clout of its peers and subsequently cannot achieve the
same cost benefits doesn't mean that it cannot make significant reductions in its fleet operational costs.
Many transport operators believe that increased sales is the only route to greater profitability. In actuality if a company fails to look at its areas of excess cost, increased sales simply add to that excess and whereas profits may appear to rise, so to does the cost of increased fleet activity.
Areas specific to cost reduction include the following:
- Fuel Use and road craft
- Routing and planning
- Vehicles and Maintenance
- Drivers hours
- Despatch Operation
- Procedures and Systems
- Back loading
The identification and reduction (or removal) of unnecessary costs can undoubtedly contribute to enhanced bottom line performance in a more immediate and direct way than sales effort alone. We are able to offer a complete appraisal of your transport operation working alongside your management team to identify unnecessary costs. Together, we can develop the methodology of reducing (or removing) many of these costs in line with your operational activities, which will ultimately lead to sustainable cost reduction, that will contribute to business growth and an improved bottom-line.
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