One client’s vehicle reassignment was managed on a branch by branch basis by a staff that lacked specialized knowledge of fleet inventory management.
These individuals were also burdened with other miscellaneous duties, entailing high associated costs. Due in part to high employee turnover, every month, close to 100 vehicle rentals were required for new hires and other emergency needs at an average monthly cost in excess of $800 a vehicle. Meanwhile, at any given time, the company had as many of 300 vehicles in storage, and was spending an average of $80,000 monthly in storage fees alone Surplus vehicles were costing money to sit needlessly in storage, while even costlier rental vehicles took their place.
The Wheels’ Vehicle Inventory Management team worked closely with the client to quickly identify and understand several reasons for this imbalance, and built a new set of rules that took all relevant factors into account – the availability of a surplus vehicle, its age and value, its distance from the new user, as well as other variables, and satisfied each individual vehicle request in the most cost-efficient and appropriate way.
Once these rules were agreed upon, information on all available vehicles in the fleet was loaded into the Wheels VIM application. The VIM consultant remained in close contact with the account team and client, continuously adjusting the program to match the company strategy. Every request for a new vehicle was addressed individually, weighing all options and associated costs, with the VIM consultant personally making the final evaluation in every case. The VIM consultant then executed all the related tasks needed to ensure successful program delivery.
Because vehicle needs arise on a case-by-case basis, the growth of inefficiency in a fleet may be gradual and its origins difficult to identify. In this case, costs had quietly grown to an excessive $1 million per year for surplus vehicles and over $750,000 for rentals.
By working closely with the client to identify the new strategy and implement the new Vehicle Inventory Management plan, we were able to achieve more than $100,000 dollars in cost reductions within the first few months.