Along with maintenance, fuel makes up one of the largest categories of spending for most fleets, and when prices become as volatile as they have been over the past year, it can be hard to stay ahead of the trend and keep expenditures in check.
While you can’t necessarily control global fuel trends, there are a few things you can do to keep your fleet’s fuel costs within your budget, regardless of what’s happening in the market.
1. Purchase in bulk, if possible
Buying fuel wholesale presents a couple of big financial benefits as well as drawbacks, but for the right fleet, this can be a great way to keep fuel costs more in line with what you project for your fiscal year.
When you buy wholesale, you’re usually buying a lower price than you would at any retail station, eliminating concerns of constant price fluctuation in the market and variability at the pump, as well as reducing time spent organizing receipts from fuel purchases. You also have an easily measured, predictive supply right at your home base, which means less downtime from refuel stops and improved productivity on routes.
Buying wholesale also comes with working with a third party supplier. If you choose the right one, you’ll be able to streamline a lot of the financial processes that come with fuel like budgeting, billing and purchasing, since you know exactly where it’s coming from, how much it will cost, and how often you’ll be paying.
The major hang up with bulk purchasing is that it’s not always feasible for every fleet. If you’re a larger industrial or government fleet with consistent workload, you’ll have an easier time justifying a steady supply of fuel than a smaller fleet that experiences a little more volatility in its workload. But with the right supplier and a well-negotiated contract, you can make wholesale fuel work for you.
2. Find ways to optimize your routes
One of the best ways to cut down on fuel expenses is to use less per trip, so finding routes for jobs that prioritize fuel efficiency is vital. You’ll want to make sure that you’re providing your drivers with routes that are not only faster, but also require the least amount of idle time.
Telematics data can be a great tool for checking your routes to see how much time you could be saving on different routes. Most fleets should have telematics devices in each of their vehicles – it’s federally required – but partnering with the right telematics provider can mean the difference between saving or wasting hundreds of gallons of fuel each year.
Make sure that whatever provider you work with offers robust GPS tracking and fuel consumption monitoring so that you can gauge just how much fuel is being used each trip and what routes are taken to get to destinations.
3. Monitor costly driving behaviors
When you start to account for frequent stops, idle time, speeding, and rapid acceleration and braking, driver behavior can be just as important as fuel consumption in managing the fuel efficiency of your vehicles. That’s another area where telematics data can be a lifesaver.
Pay attention to the behaviors recorded by your telematics devices, and you can use that information to better educate your drivers on how to complete routes in a way that saves fuel and takes better care of the vehicle. Some bad driving habits can have just as big of an influence on the health of a vehicle as it does on your bottom line.
4. Consider switching to electric vehicles in the long term
While you can find ways to stretch out a full tank on your routes, there’s no way to truly get rid of the need for that full tank – unless your vehicles don’t need fuel. Making a gradual switch to electric vehicles can mean a lot of long term benefits, like reduced maintenance or smaller carbon footprint, but it also presents the immediate impact of little to no fuel expenditure, which means a lower cost per mile per vehicle.
EVs have come a long way in the past few years, with more economical prices and better performance that make them a more realistic option for fleets. This is definitely a long-game strategy, though, as it’s not entirely feasible to replace your whole fleet with EVs overnight. But if you plan your vehicle replacement schedules well, you can begin to slowly integrate EVs into your fleet and see a considerable reduction in fuel expenses over time.
5. Track fuel spending closely
If you always find yourself frustrated with high fuel consumption at the end of each fiscal year, you might be missing an opportunity to keep an eye on expenditures throughout the whole year. Having a solid system for capturing fuel data and analyzing costs on a regular basis is the only way to catch potential spending issues before they become a full-blown budgeting problem.
We here at Fleetio are obviously a little biased toward fleet management software as a means of tracking fuel spending, as they offer integrations with fuel cards, telematics providers and other third party accounting platforms so that all of your fuel data stays readily accessible in one place. But if you’re not currently tracking your fleet’s fuel data, even a solution as simple as a well-tended spreadsheet can be a gamechanger.
The key is to make sure you keep a thumb on the pulse of your operation at all times, not just when it’s time to look at the budget or file taxes. Consistent tracking lets you quickly stem any financial bleeding that may be happening under the surface, whether from issues with a vehicle’s fuel efficiency or from potential fuel theft.
6. Utilize fuel cards
Speaking of fuel theft, one of the simplest ways to cut down on or prevent potential abuse is to institute fuel cards for your fleet, if you haven’t already. Fuel cards work just like any other business card, allowing you to effectively track, categorize and optimize spending specifically on fuel, especially if you integrate with fleet management software.
You can also find a card that offers specific benefits that can help your fleet, such as discounts at approved suppliers. Be sure to do a little bit of research before going all in on a card and gauge the pros and cons of each provider the same way you would any other credit card.
7. Take care of your vehicles
This may seem like a simpler, less prescriptive solution, but one of the best ways to keep all of your costs down is to make sure your vehicles are well tended and maintained. Poorly functioning vehicles can quickly become gas guzzlers, and by the time you’re paying for repairs on a breakdown, you’ve probably also sunk way too much money into fuel.
Make sure each of your vehicles is on a manufacturer-recommended preventive maintenance schedule so that they’re being proactively serviced, and encourage thorough, regular inspections from your drivers so you can catch any potential issues before they become costly repairs. The overall health of a vehicle is a huge contributor to its fuel efficiency, and even something as simple as an underinflated tire can cost you at the pump.
Want to make fuel tracking infinitely easier? Fleetio offers a wide range of fuel card and telematics integrations so you can keep up with everything in a single platform. Sign up for a free trial or schedule a demo today.