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Olga Weis Olga Weis Last updated Oct 28, 2022

What is a Fleet Management System?

Businesses that involve the use of multiple vehicles often employ a fleet management system. The effective use of a vehicle fleet management system can provide a company with multiple benefits.

Managing fleets requires monitoring many aspects of a vehicle’s status and location. Fleet management solutions are available to address the needs of large and small businesses. Any size company can enjoy the benefits of a fleet management system.

Definition of a Fleet Management System

So what is a fleet management system? It’s essentially a management technique that focuses on organizing and maximizing the efficiency of a company’s fleet of vehicles. A fleet management system can track vehicle location, monitor driver activity, and track the status of mechanical components. Companies can use their vehicles more productively, save money, and maintain regulatory compliance through the use of fleet management software.

Fleet management is important for businesses operating in a wide variety of industries. Common examples are package delivery companies, inter-state trucking firms, power and utility providers, and appliance repair services. Fleet management systems are not only for cars, trucks, and buses but are also used to track the movement of ships and boats.

The range of fleet management solutions employs many different technologies to track vehicle location. A popular method is to use Global Positioning System (GPS) technology to automatically monitor vehicle location and availability. Cellular triangulation is also used as a less expensive alternative for remote and infrequently used routes.

Types of Fleet Management Services

Companies operating in many different market sectors rely on fleet management services to run their businesses effectively. When you receive a package, have fuel delivered to your home, or have a repairman visit to fix a broken washing machine, fleet management software is usually involved.

Businesses can implement a fleet management solution themselves or use a third-party vendor to supply the necessary services. Companies offering fleet management solutions offer a wide range of services that can include:

  • Supply chain management support;
  • Vehicle leasing and acquisition to address fluctuating business requirements;
  • Fuel management to minimize costs with more efficient routing;
  • Maintenance services that can identify areas where preventative measures can be taken to avoid vehicle outages;
  • Compliance assistance to meet government regulations;
  • Prompt responses to accidents and collisions;
  • Programs to improve driver safety.
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Fleet Management System Benefits

Fleet management systems provide managers with the visibility they need to improve the efficient use of a company’s vehicles and comply with industry or governmental standards. Fleet management benefits include enhancing safety, identifying opportunities for preventive maintenance, and dispatching vehicles more efficiently. Following are some of the major benefits companies can enjoy through the use of a fleet management solution.

Automating manual tasks

A fleet manager needs to perform many repetitive manual tasks to maintain control over a company’s vehicles. Automating these tasks lessens administrative requirements and enables managers to focus more on business growth and exploiting new opportunities. Fleet management systems can help automate many processes including:

  • Locating vehicles and supplementary equipment in real-time;
  • Consolidating information such as invoices, delivery details, and fuel receipts for easy access;
  • Tracking driver hours of service (HOS) to ensure they are complying with government regulations;
  • Providing status updates and estimated arrival times.

Enhancing fleet safety

Accidents are a major risk for businesses operating a fleet of vehicles. The financial costs of an accident can be significant and grow rapidly if injuries are involved. A company’s reputation can suffer due to a poor safety record, driving potential customers to alternative providers.

Drivers who consistently engage in dangerous or aggressive driving often negatively impact how customers view a company. Fleet management systems can help minimize these problems and enhance safety in several ways that include:

  • Identifying drivers who perform well and those that do not;
  • Monitoring driver history to ensure they have the necessary level of training;
  • Developing a program to provide additional training to address dangerous driving;
  • Using onboard dash cam footage as evidence to protect the business in the event of an accident.
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Increasing company profitability

A fleet management system can help increase profitability in a variety of ways. The cost-saving benefits of the system include:

  • More efficient use of vehicle resources to capitalize on all business opportunities;
  • Reducing the costs of accidents and driver fines for speeding or dangerous driving;
  • Performing preventative maintenance to keep vehicles on the road and earning money for the company;
  • Eliminating fines for non-compliance with regulations.

Improving customer service and satisfaction

Maintaining high levels of customer service and satisfaction is essential to the success of any business in a competitive market. It’s always less expensive to keep a current customer than to attract a new one, so it’s wise to focus on providing the best service possible. Fleet management systems can significantly contribute to customer satisfaction in several ways including:

  • Ensuring on-time deliveries by optimizing routes and monitoring vehicle progress;
  • Providing real-time tracking information to customers so they know when a company’s vehicle will arrive at their location.

The Importance of Fleet Management Solutions

Fleet management systems are vital to the success of any business that relies on its vehicles. The benefits of using a fleet management system include enhanced safety, improved customer satisfaction, and reduced manual administrative tasks. The visibility the system provides gives managers the knowledge they need to use the fleet efficiently.

The goal of fleet management is to continually improve internal operations and customer satisfaction. Companies can save on fuel costs, reduce unnecessary emissions, and meet compliance standards through the use of a fleet management system. Improved safety and customer service will help a business compete against market rivals by attracting new business and keeping current clients happy. All companies using vehicles for business can benefit from a fleet management system.

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