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Olga Weis Olga Weis Last updated Oct 26, 2022

What is GPS Fleet Management and How Does it Work?

Many people use Global Positioning System (GPS) technology every day. We take it for granted that we can easily get detailed directions virtually anywhere or find our lost smartphone because of devices equipped with GPS capability. The personal use of GPS technology has become a valuable and regular part of daily life.

The technology is also used in many businesses and industries in the form of GPS fleet management systems. A GPS-based fleet management system helps a company maintain safety, efficiency, and compliance. Let’s see how a GPS fleet system works and how companies can benefit from its use.


What is GPS Fleet Management?

GPS fleet management is the use of GPS tracking technology to monitor the location and status of an organization’s vehicles and other assets. GPS technology is used in two ways to optimize efficiency. Drivers use GPS to obtain directions so they know where they are going and fleet managers use it to understand where their vehicles are at any given time.

Companies that implement GPS solutions can monitor vehicle movement in real time. This can result in cost savings due to more efficient operations, enhanced vehicle safety, and the ability to ensure deliveries are made on time.

How do GPS Fleet Management Systems Work?

A GPS fleet management system relies on the collaboration of several types of equipment. It uses these elements to perform trilateration to determine a vehicle’s location. The following components are used to construct a fleet management system.

  • Trackers are attached to each of the vehicles that will be monitored.
  • At least three satellites are used to receive data from the trackers to perform trilateration and calculate vehicle position.
  • Wireless cellular towers are used to receive signals from the tracker and transmit them to a cloud server.
  • Fleet management software connects to the cloud server to view real-time data about each vehicle’s location.
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FlexiHub can be a part of the GPS Fleet Management technology. The software easily forwards the data to the cloud, so that you are able to collect it remotely.
Remote vehicle diagnostics

Benefits of GPS in Fleet Management

Companies that follow fleet maintenance management system best practices can enjoy multiple benefits that enable them to thrive and differentiate themselves from their competition. The following benefits are possible when using fleet management systems.

Cost-savings - Companies can reduce costs in several ways using GPS technology. Using the system to optimize routes can save substantial amounts of fuel with accompanying cost-savings. In addition to fuel savings, maintenance costs are saved by reducing vehicle mileage.

Security - An organization’s vehicles and other mobile assets are vital to its operations. Knowing their location through a GPS fleet management system allows companies to ensure they are not misused and keeps their investment more secure.

Productivity - Company productivity is increased by understating where available vehicles are located so they can be used efficiently to fulfill new customer requests. Driver schedules can be optimized to coincide with available vehicles to keep the fleet operating for maximum productivity.

Safety - GPS information can be vital in identifying the best route to avoid excessive traffic or inclement weather. Keeping vehicles away from poor driving conditions increases safety and helps avoid accidents and driver injuries.

Two Methods of GPS Tracking

GPS technology can be used in two ways to facilitate the tracking of vehicles or assets. Based on the type of information a company hopes to gain from the system, it can choose to implement passive or active GPS.

Passive GPS collects and stores information in the GPS system where it can be retrieved at a later time. Data can be stored for a predetermined time and then transferred to a computer system while a vehicle is in transit. Users can also choose to collect the information after a trip is completed.

Active GPS, also called 2-way GPS, involves sending data to a centralized database in real time. The best fleet management systems use active GPS to maintain up-to-the-minute information on the location of vehicles and employees. This type of GPS implementation can also be used by caregivers to monitor the location of children or older adults.

What Businesses Use GPS Tracking to Track Vehicles?

Many types of businesses can benefit from the use of a GPS fleet management system. Let’s look at a few industries and businesses using this technology.

Delivery services

Commercial delivery services need to monitor the location of their vehicles to ensure that customers receive packages on time. Delivery routes can be optimized to avoid traffic jams and minimize customer-impacting delays. Vehicles that experience a mechanical failure or unexpected delays can be identified by fleet managers so corrective measures can be taken promptly. In this case, remote vehicle diagnostics can be a very good help.

The best GPS fleet management system for a delivery service will also inform managers when a driver has completed a delivery so they can be dispatched for more work or sent back to the garage. Systems can also provide information that can be shared with customers to avoid unrealistic expectations about when a package will arrive.

Bus fleets

Commercial bus fleets use GPS management systems to provide more accurate information regarding routes and arrival times. With GPS, a vehicle’s location and speed can be determined so schedules can be updated to reflect changing conditions. Buses can be rerouted to minimize traffic delays and riders can be notified of schedule changes for a more pleasant customer experience.

Commercial transportation companies

Businesses that run fleets of commercial transportation vehicles like taxi companies or car services typically use GPS and global systems for mobile communication (GSM) solutions. These systems enable them to monitor the location of their vehicles and maintain contact with their drivers.

The combination of location information and immediate communication with drivers lets managers efficiently allocate resources to take care of the maximum number of customers. It reduces waiting time and enhances the customer experience by delivering verifiable information regarding issues like arrival time and the cost of the trip.

Construction fleets

Construction companies can enjoy several benefits from a GPS fleet management system. The vehicles used by construction companies are often expensive and make an attractive target for thieves. Due to the nature of construction sites, management can’t keep an eye on the equipment at all times.

A GPS fleet management system lets a company monitor all vehicles in a construction site from a centralized location. They can gain information on which vehicles are in use and where they are located on the site.

The GPS systems can be configured to implement geofencing to alert management if any vehicles attempt to go past a predetermined perimeter. Equipment that moves past the perimeter will trigger alerts that a security team or the police can meet.

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