Bishop Fleet Optimization, a world leader in fleet utilisation and audit services, has offices in Australia, New Zealand and the United States and will be launching into the UK market in 2011. Government News spoke to Derrick Bishop, BFO founder and managing director, about the key trends in fleet management.
What are some of the major concerns of fleet managers in the public sector?
One major concern is balancing fleet costs with flat or decreasing budgets.
It is important that they purchase quality ‘fit for purpose’ vehicles at the lowest cost with best residual sale value. Fuel price fluctuations and the subsequent impact on operating budgets are also of concern.
Another significant challenge is managing vehicle numbers to meet organisation needs. Eighty per cent of vehicle costs are incurred just by possessing the vehicle in a fleet, regardless of whether it drives one or thousands of kilometres.
Depreciation (50 per cent), capital charges (19 per cent) and insurance (6 per cent) are key fixed costs in the first three years. Only about 20 per cent of costs relate to driving the vehicle such as fuel (13 per cent) and maintenance (6 per cent). These figures make it clear that optimising the number of vehicles is the number one initiative fleet managers can do to save costs.
Optimising vehicle numbers has been difficult in the past. BFO research has shown logbook-based audits are 40 per cent inaccurate due to missing, illegible or incorrect data. Mileage standards approaches ignore key factors such as vehicle destination, offsite parking duration and, importantly, the number of vehicles away from home base simultaneously. The latter is important to ensure vehicle demand peaks can be met or better distributed across a day. Read More>>
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