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What is Fleet Management: A Detailed Guide

Fleet management forms an integral part of business operations when you are dealing with freightage. And when there are no streamlined processes made to manage your fleet, then running your business becomes a challenge. On top of that, it is cumbersome to deal with data compilation and analysis if it is not an automated process. That is where fleet management comes in. In this article, we will discuss what is fleet management, how it works and its benefits.

What is fleet management?

Fleet management is the handling of all operations related to vehicles that form a part of a fleet. It is a crucial system that needs to be in place in organisations dealing with transportation, cargo shipment or delivery processes.

There are many functionalities and operations that can be taken care of with the help of fleet management, including vehicle tracking, diagnostic data, cost optimisation, fleet maintenance and employee management.

Fleet management is essentially supported by technology to a great extent, with the help of Telematics and Internet of Things (IoT). By making use of technology, fleet managers are able to keep a track of all their vehicles, whether on the road or parked in the warehouse. They get a distinct view of every movement that their fleet makes, thus ensuring safety of the cargo and the employees, along with enforcing accountability.

Apart from that, fleet management also delivers a transportation ecosystem that is efficient and cost effective. Since vehicles get subjected to regular maintenance due to a fleet management system in place, they tend to be functional for long periods of time.

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How does fleet management work?

Fleet management works on both human and technological interference, from data acquisition to processing to taking actionable steps. The idea behind fleet management is to manage vehicles, employees and operations while optimising productivity, profitability and scaling down on operational costs. To achieve all that, a fleet management system takes the aid of a fleet management software.

A fleet management software is integrated with a Telematics system and makes use of the GLONASS/GPS satellites. These satellites transmit the location coordinates of all vehicles in the fleet, working together with GPS receivers that are installed in the vehicles. These receivers record the location data and transfer it to the server, either with a cellular connection or via satellites.

This information is then relayed to the user in the form of reports and statistical data on the fleet management software, working on a desktop dashboard or on mobile. Once the data is received by the fleet manager, they can track and observe the movement and functioning of their fleet at any time.

There are two types of GPS receivers that can be used in fleet management, active and passive trackers. In the case of active trackers, the relay of information from the satellite to the receiver to the user is instant. This provides fleet manager the ability to track and monitor their vehicles in real time. On the other hand, passive trackers record all the information on the go. To access the data when required, the tracker is removed and the information is then downloaded and evaluated.

Also read: 7 Ways to Improve Your Fleet Costs

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What are the benefits of fleet management?

There are 3 key benefits that arise with fleet management: cost reduction, increased productivity and updated maintenance.

  • Cost Reduction

Integrating a fleet management system into a business can save a lot of money upfront, along with a lot of time. Fleet management ensures that proper timelines are followed, and delivery deadlines are met. This leads to bypassing unnecessary delays, and the time that would have been wasted on these hinderances can be put into more productive use. A fleet management system schedules and manages trips and deliveries, ensuring that each vehicle in the fleet is exactly where it is supposed to be.

Fleet management also reduces fuel costs incurred in a business. The system sends out alerts whenever a vehicle is idling, or over speeding, which are the major causes for fuel wastage. Moreover, with a fleet management system, fleet owners can chart out optimised routes for delivery and create efficient delivery schedules. By taking the shortest route possible, and appropriately managing delivery timelines can reduce fuel costs by 20-25% for the business.

As per reports, 40% of the costs in a transportation and shipment business are accounted for fuel. Thus, this is one of the major advantages of fleet management.

  • Increased Productivity

There is a significant improvement in productivity, both in operations and in employee performance, with fleet management. For starters, fleet management enables the fleet owner to monitor and reduce vehicle idling. When the problem of idling will be kept in check, productivity is bound to rise. Along with that, fleet management helps in monitoring the movement of the fleet. So, fleet managers can observe the daily trips being taken and can work out areas wherein they can save costs and time.

Fleet management is also helpful in boosting productivity in employees. It increases accountability within the crew, both on and off the road. With route monitoring and mapping coming into the picture, the drivers can opt for the shortest routes to get to their destinations, and make deliveries right on time.

Fleet management provides a business environment where everything is appropriately logged and defined. As a consequence, an efficiently running fleet leads to a more profitable and productive business.

  • Updated Maintenance

One of the key roles of fleet management is keeping vehicle maintenance updated. Fleet management systems provides a means for preventive and scheduled maintenance. Managers can schedule maintenance appointments for each vehicle in the fleet beforehand, and get reminders for the same as the due date approaches. This will allow the vehicles to work in the best possible conditions throughout their lifetime.

Along with that, fleet management systems ensure that vehicle health and diagnostic data such as engine health, fuel consumption, a/c usage, etc., is kept track of. With the help of this feature, the fleet managers can stay steps ahead from any faults or breakdowns that may occur and take pre-emptive measures. This will improve the longevity of the fleet.

Fleet management is a crucial practice that needs to be implemented in a business to enhance productivity, profitability, customer retention and satisfaction.

Quick read: Learn All About Asset Tracking

Quick read: Top Tips for Optimised Fleet Maintenance

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