3 questions to ask when benchmarking your fleet’s financial performance

If your company is running its own private fleet of trucks, have you bench marked your fleet’s financial performance? If not, — you’re not alone.

According to a 2014 study by the Private Motor Truck Council of Canada, 61% of companies do not benchmark their fleet costs or effectiveness. This number is staggering. Without a full understanding of fleet costs and performance, how will decision makers know if a private fleet is the best option for their transportation needs?

For decision makers who want to conduct an ROI review of their private fleet, there are 3 key questions to ask:

1. What is my current fleet management proficiency?

In important areas of fleet management, your company should objectively assess its current proficiency. A thorough self-assessment will cover areas such as driver management, fleet safety, regulatory compliance, technology, risk management, and financial measurements of fleet performance. This will give you an understanding of where you are performing well, and where you have gaps in fleet management. To help with this exercise, Canada Cartage has developed a 12-page Fleet Management Self-Assessment Guide to help your team conduct this analysis, and then score and interpret the findings of your work.

2. What is my total cost of ownership? According to a 2013 study by Ernst & Young, most companies lack a detailed total cost of ownership (or TCO) for their private fleet. Without this, it is difficult to measure fleet management performance, cost effectiveness or efficiency. A complete TCO will be a combination of hard costs (i.e. truck payments, tires, maintenance, insurance, fuel, driver wages, etc.) and soft costs (i.e. administration time, safety training, driver management, liability, etc.). Hard costs are relatively straightforward to identify and quantify; soft costs are more difficult to determine, but they are equally important. Canada Cartage has recently developed a detailed Private Fleet TCO Calculator™ to provide decision makers with a complete tool to calculate fleet costs.

3. How does private fleet management compare to a fleet outsourcing model?

Now that you have a good understanding of your current fleet performance and your total cost of ownership, the next logical step is to benchmark your private truck fleet performance and costs against an outsourced fleet option. Many companies are unaware that a dedicated outsourced fleet can offer the same advantages of a private fleet, but without the management distraction, headaches, and potential risks and liabilities. Canada Cartage offers companies an objective resource paper that lays out the pros and cons of both private fleet ownership and dedicated fleet outsourcing. The complimentary 24-page Fleet Outsourcing Evaluation guide can be downloaded here. By investing the time to conduct these benchmarking activities, you’ll be confident that you have the right fleet model in place to support your firm’s strategic growth and customer service objectives. If you have any questions, please contact us at info@canadacartage.com.