Understanding the Cost Factors of Fleet Management (Part Four)

To be a better fleet manager, you need to understand four major cost factors of your fleet. In this post, we'll discuss Fuel Costs.

Missed Part Three? Read it now!

fleet fuel costs

Fuel Costs

Fuel cost is simply the total cost of fuel used to operate your fleet. There may be fuel costs for vehicles themselves and fuel costs for their attached equipment. You should attempt to distinguish the fuel used by vehicles and by equipment separately so that efficiency comparisons can be made between like vehicles and like supporting equipment.

Now that you’ve discovered more about fuel costs, think about these as they apply to your business.

  • Do you have a specific place to regularly fuel your equipment?
  • Do you require drivers to request permission to fuel up and/or have them submit receipts immediately upon fueling?

For those just getting into fleet management on a formal basis, or for those who are attempting to analyze costs in order to better understand where expenses originate, here are a few simple suggestions. We have all used the phrase “think outside of the box”. That is a simple phrase, but it assumes that a person understands what the “box” is. You might try to first determine where your company’s “box” is when it comes to asset costs. Thinking outside of the box is often one of the first things you need to do when attempting to lower or control costs.

The fuel box: using a nearby fuel point because it’s easy for drivers.

Some companies provide a card where the driver may choose his own source for fuel. There are many options for controlling your fuel costs, and unfortunately, we cannot assume all drivers are honest.

Thinking outside the box here requires the company fuel controller to critically examine all fuel use while assuming that all drivers are not honest. This means they must give precise attention to detail regarding fuel purchase reconciliation, fill-up location and fuel card usage.

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Post Contributor: Jim Russell, Fleet Management Consultant

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