As a small business owner, saving money while still seeing growth is a top priority. So, when it comes to making large purchases, such as vehicles for your fleet, there’s no room for error. It’s not always easy to determine which type is best. Each type comes with its own set of pros and cons, which are separate from the initial cost and subsequent maintenance. If you’re still sitting on the fence and don’t really know what to look for, this article is for you. Read on to learn some of most important things to consider when purchasing company vehicles.
Types of Vehicles
The type of fleet you have depends on your niche. If you own a doggy transport service, you may want to buy mini-van, SUVs, or at the very least, a car that is a hybrid between the two. If you own a cleaning company and plan on providing transportation for your employees, then you’d want to invest in compact cars that get good gas mileage. Honda, Nissan, and even Toyota all have compact models you can choose from.
Think About the Resale Value
Depending on your business model, you may or may not want to sell on day. That said, you need to think about your fleet’s resell value. While buying used trucks or cars might seem like a good idea at the time, especially when you’re just starting out, you could actually lose money in the long run. Aside from economy models that get better gas mileage, you might want to think about buying electric vehicles. EVs not only save you money, but are also good for the environment. If you’d like learn more, you can see valuable options here. You also need to consider whether or not what you choose will be useful to another company, such as having your logo on the side of the car or truck is one of the best ways to promote yourself. However, unless the logos are peelable, it might be hard to resell.
Think About Short and Long-Term Needs
As your business grows, your needs will change as well. Present day needs will be different than ones you’ll have in the future. If you just launched, your focus will be more on boosting brand awareness and staying afloat. As time goes on and your financial stability improves, your focus will change to finding ways to improve customer retention and converting leads into repeat customers. In addition, you also need to think about your vehicular needs as your customer base grows. Only having one or two trucks in your fleet is okay in the very beginning, however, if you experience rapid growth, you need an action plan in place to fulfill orders in a timely manner. The last thing you need is to lose customers because you couldn’t deliver their orders.
Cost of Fuel and Maintenance
Aside from the actual cost of the vehicles, you need to think about fuel and maintenance costs. Even if you are skilled in a few car tuning tips there will come a time where more experience is needed to help maintain your fleet. If you aren’t in position to buy electric vehicles, you will need to factor in the cost of fuel. Even though the prices are dropping, gasoline is still pretty expensive. If you need more than one vehicle, you’ll need to find ones that have good gas mileage. Aside from that, you’ll also need to budget for routine maintenance and emergency repairs at WalkerToyota.com. A good rule of thumb is to stash away money every month. Even if it’s only a couple hundred of dollars, set aside money to cover the cost, so you’re aren’t caught off guard.
Types of Insurance
Just like your own car, company cars and trucks also need to be insured. There are several different types of coverage you can choose from, so it’s always best to research which will provide the most value at the lowest cost. Most companies offer discounts when you bundle your insurance needs, so you can always opt to use the same carrier for auto and liability protection.
Buy or Rent
Another important thing you need to consider is whether you’re going to buy or rent. Some choose to buy outright whereas others prefer to rent at first and then once they start seeing ROI, they choose buy. Neither choice is right or wrong; it’s more about what works for you and your overall vision and budget.
Once you decide on the type, you then need to consider management solutions. At the very least, you should invest in GPS systems. Using a GPS allows you to keep track of your drivers and make sure they’re where they’re supposed to be at all times. This is particularly important when you have deadlines to meet or if your driver is going somewhere they’ve never been before. Dash cams another valuable investment you should consider. They let you monitor how your employees while they’re behind the wheel. While some might say dash cams are intrusive, they can help you win a law suit if your driver is involved in an accident. ELDs are also an important part of your fleet management system. These electronic logging devices keep track of how long your drivers have been on the road, making it easier to follow regulations.
By law, long-haul drivers must take rest periods after a certain amount of time. Using an ELD gives you the extra peace of mind you need to know your employees are following proper protocol. Keep in mind that you can also consider leasing at first. Similar to how you can lease a car for personal use, you can do the same for your company. This may work for entrepreneurs who are in the earliest stages and looking to save money.
Determine Types of Use
One point that’s easy to overlook is your actual need. If you’re only going to need transportation locally, then buying a long-haul truck wouldn’t make sense. On the other hand, if you need to make deliveries across state lines, you wouldn’t want to only buy a pick-up truck to carry cargo. If you plan on expanding your service area, or switching from local to long-haul, you could then plan on swapping your current fleet for a new one.