Four Fleet Optimization Tips for Improving Cost Control

 

With inflation and supply and labor shortages impacting the pest control industry, the rising cost to do business makes it harder for companies to keep their prices competitive. Fleet management solutions provide companies with actionable data to streamline workflows, decrease downtime and improve fleet profitability.

 

Pest control fleets have had a lot of obstacles to contend with over the past couple years. Long lead times and increased cost for asset procurement and replacement parts, labor shortages and inflated fuel prices are bad enough. Add to that the continuing supply chain issues combined with record-high inflation and it’s not hard to see why even trade supplies and material procurement has become difficult and costly, leading some companies to bump up their pricing for customers and clients. 

 

While companies can assess the effect of raising their service prices using the price elasticity of demand formula, price elasticity is typically calculated after price changes, and not knowing the aftermath of what price hikes might mean for the business can be a detriment. In the current economic climate, losing customers or contracts can push a company into the red, so before making the decision to bump up service prices, first take the time to understand how to effectively cut unnecessary fleet expenses and reduce supplies waste for improved cost control.

 

With the present vehicle procurement difficulties, pest control fleets are having to adapt to keep assets on the road longer. Proper preventive maintenance (PM) can increase a vehicle's useful life, prolonging the need for replacement. Fleet managers can use vehicles’ service histories and inspections, as well as driver and technician feedback to determine optimal PM schedules, keeping assets in safe, reliable condition for longer. Automated fleet management software (FMS) and other solutions allow managers to set and customize PM schedules based on OEM recommendations, mileage, or other asset-specific criteria, as well as set scheduled service reminders to be sent to drivers and technicians so vehicles never miss service. 

 

In addition to improving PM compliance, FMS also automates workflows for improved productivity and uptime. Digital inspections allow drivers to submit vehicle information in real time, while failed items initiate an issue in the system that immediately alerts managers of needed work. Managers can schedule service and assign a technician directly from the issue with a digital work order. Technicians can use digital work orders to clock in and off jobs directly, as well as leave comments about work performed. All the associated data, including labor and parts cost, is automatically logged for reliable service histories and cost summaries, and in-house inventory counts are updated automatically as parts are added to work orders. Fleets outsourcing maintenance can similarly improve service workflows using a software’s outsourced maintenance automation (OMA) feature.

 

By optimizing PM schedules, improving PM compliance and streamlining service workflows, pest control companies can increase uptime and reduce repair expenses, leading to a more productive and cost-efficient fleet.

 

A well-managed parts inventory means your assets are never sitting in the shop waiting on a part to resolve standard maintenance or recurring issues. Fleets can optimize on-hand parts inventory by analyzing service histories to determine most and least used parts and number of parts used per period (monthly, quarterly, etc.). With automated software like FMS, fleets can look at inventory activity and order list reports to see past trends in stock and movement. 

 

Inventory optimization and management isn’t limited to replacement parts, however. Because companies are also having to contend with the increased cost of supplies, managing supply inventory and tracking the cost and effectiveness of supplies provides insights into whether switching brands or product types would make for a meaningful change. By tracking and monitoring supplies-related data, including cost, quantity used per job and effectiveness of product, fleets can determine whether changing products is profitable, whether supplies are being used inconsistently on similar or recurring jobs and whether increased accountability is needed to reduce product waste.

 

Proper parts and supplies inventory management, including keying in on the right product for the job and reducing instances of supplies waste/misuse, allows pest control fleets to hone in on where to cut costs to reduce spend while ensuring profitability.

 

Balanced fleet utilization can reduce service costs, improve uptime and increase vehicles’ useful life. Fleet utilization data relies on the collection of vehicle usage data. Usage data allows managers and stakeholders to assess vehicle productivity. Fleets can manually track usage through daily mileage reporting. Asset usage discrepancies like extensive out of service times or a significant increase in mileage can throw PM schedules out of whack and cause additional issues like unnecessary service spend. 

 

Using fleet software allows managers to quickly and easily break down vehicle usage in greater detail due to automatic data collection and aggregation. Having instant access to a wide array of usage-related data — vehicle status histories, asset assignments and more — allows managers to surface fleet utilization imbalances contributing to inflated fleet expenses.

 

A vehicle’s total cost of ownership (TCO) is the best metric to determine when it’s time to retire that vehicle, as well as how much useful life it’s projected to have left. Knowing the TCO of vehicles is extremely beneficial when creating replacement and procurement strategies. Not only does TCO give stakeholders a better idea of when to pull a vehicle before it becomes a money pit, it also gives a more accurate timeline for replacement so fleets can get in new vehicle orders early to mitigate the impact of lengthy procurement lead times.  

 

TCO accounts for all costs related to each vehicle, including capital/loan/lease payments, fuel, insurance, registration, depreciation, maintenance and taxes. While this can be calculated manually, FMS automatically calculates the TCO for vehicles so fleets can identify and correct areas of overspend, determine optimal replacement windows and improve vehicle ROI.

 

The ability to make operational improvements based on data-driven insights is key in gaining control of fleet operating costs. Integrated fleet management solutions provide in-depth fleet performance monitoring and allow managers to track and analyze fleet data easily and in real time through automated data collection and consolidation.