Replace Your Delivery Fleet

Interested In Replacing Your Delivery Fleet or Truck?

 

Are you maximizing your trucks? Are your trucks driving empty a considerable amount of the time? Are you tired of all of the hassles and time it takes to manage and pay for your truck(s)?
Is delivery and distribution truly your core business?
Your quick answer to that question may be yes, getting your product to your customer or the end user is a vital part of your process, so obviously you want to make sure it is done correctly and on a timely basis.

Fair enough … but even though that may be the case, there’s a good chance that delivery and distribution and all that goes along with owning delivery trucks is not truly your core business. Just like the computer network that runs your company, you could manage that yourself as well, but it takes a lot of time, effort and expertise to manage and keep your computers running properly. And because IT isn’t your core business, you outsource it to a company that has much more expertise and efficiencies.

Same reasoning applies to your delivery fleet. Although it’s a critical part of your company, it’s not your core business, and anything that doesn’t help you increase and improve your core business, can be a big distraction!

What are the real and true costs of owning?
your own fleet or delivery truck?

As you probably experience every single day, there are numerous costs involved in owning a delivery fleet or truck–these costs can be broken into two categories:

1. Hard Costs
2. Intangible Costs

Oftentimes business owners and managers have a pretty clear picture of the hard costs of their trucks: gas, maintenance, insurance etc. But what they often don’t have quite as good a handle on are the intangible costs associated with owning a delivery fleet or truck.

It is almost impossible to maximize productivity on 100% of your fleet while still maintaining a high level of service to your customers. And keep in mind; If all of your vehicles are busy all of the time, then somewhere there is a customer waiting longer than they would like!

As this scenario is unacceptable to most businesses, it is common for a business to own more delivery resources than it can utilize to 100% capacity … and truth be told, most companies delivery vehicles are busy less than 50% of the time! Drivers often drive like they “ain’t got a dime in it!”

Can you relate to that statement? If you can, then there is a good chance that your driver(s) are costing you more problems and money then you’re comfortable with. If a driver truly has the “drive like I ain’t got a dime in it” mentality, you’ll have to deal with quite a few issues including small accidents, spin-outs, and bad driving habits with your company logo showing prominently.

Management of drivers is a huge issue and a very large intangible expense that you are forced to deal with on a daily basis. Owning a delivery fleet or truck is a big decision and one that could have long-term effects on your company. You need to ask yourself why you decided to purchase or lease your delivery vehicles in the first place. Is delivery and distribution a core part of your business or is it simply something your company has always done?

You may be surprised to learn that you can save up to 50% by outsourcing delivery to a third-party delivery and logistics company. Become A Quick Expert On Replacing Your Delivery Fleet or Delivery truck. Here you’ll get a complete list of the tangible and intangible cost of owning your own delivery truck or fleet. Also, we will discuss liability insurance, and how to protect your company.

Are You Considering Replacing your Delivery Fleet or Truck? Are you a Phoenix metropolitan business owner, or maybe a local branch of a national company that owns a delivery truck, or maybe even a small fleet of trucks that you have to manage on a daily basis? Are you maximizing your trucks; are your trucks driving empty a considerable amount of the time; are you tired of all of the hassles and time it takes to manage and pay for your truck(s)? Is delivery and distribution truly your core business?
Your quick answer to that question may be yes, getting your product to your customer or the end user is a vital part of your process, so obviously you want to make sure it is done correctly and on a timely basis.

Fair enough … but even though that may be the case, there’s a good chance that delivery and distribution, and all that goes along with owning a fleet of trucks is not truly your core business. Just like the computer network that runs your company, you could manage that yourself as well, but it takes a lot of time, effort and expertise to manage and keep your computers running properly. And because IT isn’t your core business, you outsource it to a company that has much more expertise and efficiencies.
Same reasoning applies to your delivery fleet. Although it’s a critical part of your company, it’s not your core business, and anything that doesn’t help you increase and improve your core business, can be a big distraction!

First, let’s look at the real and true costs of owning your own fleet or delivery truck…As you probably experience every single day, there are numerous costs involved in owning a delivery fleet or truck–these costs can be broken into two categories:

Hard Costs
Intangible Costs

Oftentimes business owners and managers have a pretty clear picture of the hard costs of their trucks; like gas, maintenance, insurance etc. But what they often don’t have quite as good a handle on are the intangible costs associated with owning a delivery fleet or truck. Let’s look at each one of them individually to get a clear picture:

1. The hard costs
This is a list of the hard or true costs of owning your delivery trucks:
Drivers (one of the most costly and critical factors)
Maintenance
Insurance
Lease or interest payments
Fuel
Management time
Employee wages
Benefits
Vacation pay
Payroll taxes
Employee tools and equipment
Painting/lettering
HR and driver training costs
Licensing and certification
Replacement/damage
Driver scheduling

In the above list, all of these expenses are fixed, with the exception of fuel, and to some extent maintenance. The majority of these hard costs are paid every single month regardless of whether your vehicles are busy, 70%, 50%, or 20% of the time!
It is almost impossible to maximize productivity on 100% of your fleet while still maintaining a high level of service to your customers. And keep in mind …
If all of your vehicles are busy all of the time, then somewhere there is a customer waiting longer than they would like!
As this scenario is unacceptable to most businesses, it is common for a business to own more delivery resources than it can utilize to 100% capacity … and truth be told, most company’s delivery vehicles are busy less than 50% of the time!

2. Intangible costs
Your intangible costs are the most hidden and often times the most important expenses to get a handle on. Here is a list of just some of the intangible costs you are now incurring or will incur if you own a delivery truck or fleet:
Maintenance: Scheduled and unplanned or unexpected
Managing the maintenance
Risk/liability
Dispatching the drivers
Tracking the drivers
The GPS tracking system
Time stamps on deliveries
Truck breakdown; Who helps the drivers?
Training drivers and employees
Management of drivers
Tracking the success of your delivery system (if you have one!)
Covering the drivers when they are sick or on vacation
Inefficiencies of the drivers
Recruiting drivers

Compliance enforcement
The intangible costs of owning and managing a delivery fleet or individual truck are the expenses that most often are missed, or at the very least, misunderstood! The intangible costs of a driver being sick and another worker having to fill in for him is not only a hassle, but someone has to fill in and do that replacement worker’s job as well. How does that work get done, and how does that affect your company’s production and productivity? That’s a perfect example of an intangible costs … and with a delivery fleet there are many, many examples of those types of additional costs to your company.
Here are 10 additional intangible costs and issues associated with owning your own fleet or delivery truck
Ineffectiveness of freight coming from one location
Trucks are driven empty a large percentage of the time
Trucks sitting idle—waiting for a delivery
Having no GPS—no idea where drivers are or what they are doing!
The Double-Mile Scenario: For example; driving from Eden Prairie to St. Paul, the truck is empty on the way back, wasting money and causing what is called “the double mile scenario!”
Peaks and valleys in your business
Paying for a driver that is sitting and waiting for a delivery
Paying for overtime
Managing the drivers
The fleet of trucks and the drivers are totally underutilized
Drivers often drive like they “ain’t got a dime in it!”
Can you relate to that statement? If you can, then there is a good chance that your driver(s) are costing you more problems and money then you’re comfortable with. If a driver truly has the “drive like I ain’t got a dime in it” mentality, some of the issues you may have to deal with include:
Not caring about spin outs
Not worried about small accidents
Mysterious dings and dents start appearing on the trucks
Don’t care about extra mileage
Quick starts and stops: hard on vehicle and gas mileage
Bad driving habits with company logo on the truck—bad for image!
Management of drivers is a huge issue and a very large intangible expense that you are forced to deal with on a day to day basis.
Do you allow your drivers to take their vehicles home?
Surprisingly, it is a practice that many companies allow … and quite frankly, it’s not a very good idea–here’s why: Vehicles are often used for personal errands
Cost of miles to and from home
Lack of control of the vehicle
Company vehicles are often lent to friends and neighbors
Drivers may do extra deliveries for cash
Liability problems with lending vehicles
Security: Where is the truck parked at night?
The truth is allowing drivers to take a truck home just lends itself to misuse and abuse–even with great employees!
How do you gas up the trucks…do you give the driver a gas card?
How do drivers and employees fill up the vehicles with gas? How do you track and protect your company from misuse. Giving an employee a gas card makes it easy for employees to use the card for personal use—even with great employees! Are you comfortable giving your hourly rate employee or non-management employee a credit card? Because that’s exactly what you are giving them!
And if you don’t give them a gas credit card, then how do they fill up their trucks? Who manages that aspect of your deliver fleet, and how much does it cost you in management costs and time to do that?
Liability Insurance: How to protect your company
When it comes to liability insurance your company is really on the hook for the actions of the driver, including negligence. And the truth is, in most instances drivers are not properly managed.
Many companies will say “oh, no problem … we have insurance.” They honestly believe they are 100% covered…when in truth they have no real clue on exactly what type of liability they have and just how deficient it may be. They are not covered for a “nightmare” experience. If your driver slams into a car full of kids, and people are hurt or even killed, your insurance company has their interests at heart—not yours!
The bottom line is this: if your driver is at fault, your company is liable … and who do you think they’ll come after? They’ll follow the money trail, wherever it leads! And there are a ton of MNDOT regulations that drivers and company’s need to follow, and if they aren’t followed, your company can be held liable.
How do you protect yourself—what is “doing everything right”
If you own your own truck or fleet it is imperative that you understand what is needed to keep your company safe from “shut down your business” lawsuits. They include:
Regular driver safety programs and training
Understanding and following MNDOT rules and regulations
Regular auditing that assures that you’ve followed all the regulations
Drug testing for all drivers
Maintenance–ongoing, regulations for maintenance, DOT inspections
If you’re doing everything right, including the list above, then you’re probably all right. If you aren’t doing these things to the letter of the law, and you don’t have all of your ducks in a row regarding liability insurance, training, coverage, management–you could be in trouble!

Conclusion:
Owning a delivery fleet or truck is a big decision and one that could have long-term effects on your company. You need to ask yourself why you decided to purchase or lease your delivery vehicles in the first place. Is delivery and distribution a core part of your business or is it simply something your company has always done.
If it truly is part of your core business and something you need to do—great, keep rolling along. But if it isn’t, taking the time to really research and identify your true costs of your delivery feet and drivers and their impact on your company could be very eye opening. You may be surprised to learn that you can save up to 50% by outsourcing delivery to a third party delivery and logistics company?

- When it's got to be there fast and on time Mercury Delivery Services Same Day Phoenix Courier, Messenger and Delivery Service offers delivery times that are designed to give our clients cost saving options. Most of our competitors use a system that forces you to choose the more expensive delivery. Read on, and see why our clients love the way our service is set up! Regular Courier, Messenger and Delivery Service: Our 3-4 hour courier service that starts at 9 AM and can be used up until 3 PM. After 3 PM, rush charges apply. Rush Courier, Messenger and Delivery Service : Our 2 hour courier service that starts from the moment your package is ready for delivery. Non Stop Courier, Messenger and Delivery Service: When rush service isn't fast enough, our courier will pick it up and go straight there for you - with absolutely no stops along the way!

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- Are You Interested In Replacing Your Delivery Fleet or Truck? Are you maximizing your trucks? Are your trucks driving empty a considerable amount of the time? Are you tired of all of the hassles and time it takes to manage and pay for your truck(s)?

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