When running a security company, home service, or electrical contracting business, you need an efficient fleet of vehicles. From a business perspective, leasing these automobiles makes more financial sense than buying and managing an entire fleet. However, one major concern you are likely to have as a lessee is vehicle utilization. What is it, and why does it count?
Vehicle utilization as a metric refers to the degree to which your team is using the available fleet. Some questions this metric answers include whether you are deploying your workhorses for the intended purposes at a given period of time.
Experts in fleet management express vehicle utilization as a percentage and measure of how constructively you are employing the automobiles at your disposal. For example, if a vehicle operates for 8 hours in a day and its maximum potential usage is considered to be 10 hours, the vehicle utilization would be calculated as (8/10) * 100 = 80%.
Higher vehicle utilization indicates you're using your fleet well. You are actually generating more value from its operational hours. On the other hand, lower vehicle utilization suggests otherwise. It means you're underutilizing your vehicles. The truth is, you can potentially improve the resulting inefficiencies and idle time to enhance cost-effectiveness and productivity.
Several factors help business owners or managers determine how employees are using the fleet at hand. To get it right, look at aspects such as:
Time utilization is one of the best ways of finding out how constructively you are using your fleet. This metric focuses on the amount of time a vehicle is actively in use compared to its total available time. While at it, it takes into account various factors, including shifts, working hours, periods of maintenance, and downtime.
When your fleet manager analyzes the time data, they can easily identify instances of underuse. This information helps them optimize vehicle schedules, allocate resources efficiently, and reduce unproductive time.
Distance is another fundamental aspect of fleet usage. It focuses on the actual distance a vehicle travels with regard to its possible capacity. At this point, fleet managers are looking at the route taken, the miles driven, and the automobile's capability. The ultimate goal is to pinpoint wasteful routing, excessive mileage, and poor performance.
Regardless of your field, you want to run cost-effective operations. For this reason, you need to use all your leased vehicles optimally to minimize expenses arising from underuse. The last thing you want to do is pay for a rented asset that is not providing adequate value to your enterprise.
Productive revenue generation is also essential, which is achievable through effective fleet deployment that ameliorates performance and drives profits. By transporting resources efficiently, your employees are able to promptly meet customer demands, complete more tasks and increase your income-earning opportunities.
Vehicle utilization data also plays an integral role in successful fleet operations. You can use this information for planning and decision-making. Further, tracking and analyzing your automobile's running patterns can help you identify the best fleet size for your company and streamline operations. The bottom line is that vehicle utilization matters to your business because it directly affects cost efficiency, productivity, and profitability.
Are you looking to optimize your fleet operations and enhance your business efficiency? Look no further than Wilmar, the Southeast's largest independent fleet leasing and management company headquartered in Charlotte, North Carolina. With our comprehensive range of services, including fleet leasing, fleet analysis, fleet selection, and fleet management, we have the expertise and experience to streamline your fleet operations.
Contact us to schedule a consultation and discover how Wilmar can transform your fleet operations.