Fleet Savings: Begin with the End in Mind
We scour the web for the best prices on a flat-screen TV. We go to the local pub on 25-cent wing night. We all look to save money — especially when it comes to one of our most expensive investments, the vehicles we buy.
Sticker prices make it easy to compare a vehicle’s cost. But, the key to fleet savings is in the finer print — of maintenance, repair, depreciation, taxes, insurance, and more.
And, of course, the fuel.
So, how do you choose the right fuel for your fleet vehicles to save you money? Follow these three steps to understand what data you need to measure and why:
- Compare cost per mile. Since alternative fuels burn differently than do gasoline and diesel, comparing your actual cost per mile driven provides a more accurate measure of true fuel savings than price per gallon.
- Weigh total cost of ownership (also known as TCO). An analysis based on your total cost of ownership includes not just your daily mileage costs, but also total cost of acquisition and operating costs. Some alternative fuels, like propane autogas, result in reduced maintenance costs and potential for longer engine life. Seek a fuel that drives down your total ownership costs.
- Begin with the end in mind. When choosing a fuel solution, follow author Stephen Covey’s advice and “begin with the end in mind.” Spending more up front on a vehicle may end up costing you less in the long run.
Here’s your fuel for thought: Keep seeking out ways to reduce fleet costs, without compromising quality, by shifting away from simply acquisition costs. Instead, focus on total ownership costs of your vehicles for a smart return on investment.