Whether you own a heating oil delivery service or a bakery, if your business owns vehicles, you need to know about managing a fleet. That might seem arduous since most small business owners already have so many tasks to manage, including operations, budgeting, procurement, bookkeeping, inventory, customer service, etc. Learning to manage your fleet, whether your business owns one or 100 vehicles, can save you time and money in the long run. Read on to learn the ins and outs of fleet management, such as how transmission repair shops can help.
How to Manage a Fleet of Vehicles as a Business Owner
When you purchase that first company car, fleet management seems so simple. You probably conduct the vehicle maintenance yourself or take it into the dealership as you do your personal vehicle. As you grow the fleet of vehicles owned by your business, hiring a local fleet maintenance service makes things simpler. This service handles all the upkeep from oil changes and tire rotations to detailing and installing vinyl wraps.
Fleet Management in General
Until you contract with a fleet management service, knowing how to care for your vehicle remains up to you. Perhaps you didn’t count on becoming a fleet vehicle management guru, but coinciding your first forays into developing this knowledge with the purchase of your first company car, truck, van, or SUV makes the most sense. What a fleet management service offers varies by company, but you need to perform all the tasks until you contract with a service. Let’s first consider the fleet management tasks that need to happen before you hit the road.
Properly Insure Your Vehicles
Regardless of whether you own an AC service or catering business, before you hit the road with your fleet, each vehicle needs appropriate commercial auto insurance coverage. You and your employees cannot legally drive on the road until each fleet vehicle has a proper insurance policy in place that meets, at least, the business minimum required coverage by the state in which you operate your business. Before you can drive on the roads, you must also register each vehicle with your state’s Department of Motor Vehicles and pay the commensurate fees, a feat that requires proper insurance.
Commercial auto insurance works the same way as personal auto insurance. You build a policy that suits your needs with the minimum level of the state minimums. Your insurance coverage minimums depend on the type of vehicle, too. If your company purchases semis or other large trucks, these vehicles require commercial truck insurance, which differs from typical commercial auto coverage.
Operating a fleet that includes large trucks, especially tractor-trailers, means your drivers need to buy insurance, too. Once they each earn a commercial driver’s license, they’ll each need bobtail insurance and a trucking insurance policy. To properly cover your fleet’s large trucks, you will need to purchase the following types of coverage:
- Bodily injury liability
- Property damage liability
- Uninsured/underinsured motorist
- Medical payments
- Motor truck cargo
- Motor truck general liability
- Non-trucking liability
- Heavy truck roadside assistance
- Rental reimbursement
- Trailer interchange
- Garage keeper’s legal liability
- On-hook towing insurance
Most personal policies only require liability coverage, so prepare yourself for the multitude of coverages needed to legally operate a large truck.
Other commercial vehicles, such as sedans, SUVs, light trucks, and vans only require the same state minimums as personal vehicles, typically. Check your state for specific requirements. Although not mandated, add collision and comprehensive to your commercial fleet policy. Without them, any damage to your company vehicles from an accident your driver caused or from acts of nature comes out of your business’s pocket.
Regular Fleet Vehicle Maintenance
Purchasing your first fleet vehicle could mean buying a typical car or truck from your local dealership and slapping signage on each front door to designate it as your business vehicle. You’ll better serve your business’s long-term goals if you shop in the commercial vehicles section of the dealership. Most vehicle manufacturers offer commercial vehicles designed for fleet service. These vehicles offer customizations, such as interior cargo van options and chassis cab designs.
Buying commercial fleet vehicles often nets you an accompanying maintenance plan that covers the first one to three years of manufacturer-recommended maintenance. That means you can take the fleet vehicles to the dealership’s service center for free during those years for maintenance services, such as oil changes, tire rotations, belt replacements, etc. A manufacturer’s maintenance plan saves you big money in those first few years, so consider it a necessary feature when shopping for your commercial vehicles.
These maintenance plans with purchase do not cover damages to your vehicle caused by an accident. Knowing where to take your vehicles for repairs tops the list of important facts about managing a fleet. Your commercial insurance policy covers repairs like mobile windshield services, dent repairs, etc. if you purchase collision and comprehensive coverages.
Once you grow your fleet to include a few vehicles, you might consider hiring a part-time or full-time mechanic to take care of them. Until that time, find trustworthy, reliable mechanics and bodywork technicians, so your business has a ready list of go-to people when the need arises. That saves you from needing to make calls to many transmission repair shops when you need to take in a vehicle.
Here’s another thing about managing a fleet – the cost of repairs fluctuates. While labor typically remains stagnant, parts costs can vary. Talk with your trusted mechanic about the differences between aftermarket, original manufacturer equipment parts (OEM parts), reconditioned parts, and used parts. Aftermarket parts cost less, but may not always provide the ideal choice, while reconditioned parts typically offer an OEM part for less money.
Professional Services to Contact
Learning about managing a fleet becomes easier when you have the right contacts and service personnel already identified. Until you hire a dedicated mechanic to service your business’s fleet, you will need to find a mobile truck repair service that serves your delivery area. If your company has a large delivery area, such as a heating oil company in the northeast U.S., you may need to identify more than one such company and set up a vendor account with them.
Once your company grows to the size that it can hire a dedicated mechanic for fleet management, you won’t need all the service providers. Until that time, take the time to identify the best transmission repair shop in town, the highest quality auto signage shop, and the best dent repair shop. Build your Rolodex of go-to services, so you can quickly repair your vehicles and get back out onto the road.
Requirements of Fleet Vehicle Drivers
Your budding well pump repair business may employ many individuals who know about well pumps, but few who know about managing a fleet. As the business’s owner, it’s your job to make sure that every person who steps behind the steering wheel of your fleet vehicle has an appropriate driver’s license and insurance. For most fleet vehicles, a driver only needs a normal driver’s license, but driving many large trucks, including some delivery trucks and all semi-trucks, requires a commercial driver’s license (CDL).
Here’s the complexity about managing a fleet. CDL requirements vary by state, so once you grow your business to include more than one location in more than one state, each location must meet that state’s CDL requirements. Generally, in the U.S., operation of the following types of vehicles requires a CDL:
- Any vehicle with a gross vehicle weight rating (GVWR) of 26,001 pounds or more
- A combination vehicle with a gross combination weight rating (GCWR) of 26,001 or more pounds, as long as the towed vehicle(s) weighs 10,000 pounds or more
- Vehicles designed for transporting 16 or more people
- Transport of select agents or toxins in any size vehicle or operation of any size vehicle requiring hazardous material placards.
To obtain a CDL, the individual must reach the age of 21 years, complete a commercial driving course, and pass the written and driving tests for that license.
Although the company itself purchases commercial auto insurance, each driver must also purchase commercial auto insurance if they will ever operate the vehicle outside of work, according to insurance industry definitions. For example, when a truck driver stops by the grocery store for a few things on their way home, driving the company truck, the insurance industry considers that driving while off work. If a trucker drops off their load and drives an empty rig or a cab by itself, they need specific liability insurance to cover these situations. Even though they must purchase the insurance, the business owner must check to make sure they carry the proper insurance.
Different Types of Commercial Vehicles
What kind of vehicle does your turbo repair shop need for its first purchase? What about a bakery or caterer? Does a florist need the same type of vehicle? Here’s a comprehensive look at your first big decision about managing a fleet – what to include in it.
Choosing the right vehicles requires knowing what’s out there. Choosing your first vehicle might seem simple because you fill an immediate need, such as delivering cakes or towing vehicles. As your business grows, you might need more than one type of vehicle though.
- Sedans: Businesses that conduct onsite meetings, visit clients or customers, or provide company cars for their employees, typically choose sedans. Fleet sedans offer a little more interior space and typically include mid-level to high-level trims. Some automakers offer discounts for the purchase of more than one vehicle at a time, typically starting with five vehicles.
- Heavy-duty trucks: Although they look a lot like the personal light-duty trucks that carry the same names, these heavy-duty designs feature more powerful engines and transmissions. Some offer diesel engine options. Designed for towing and hauling weighty loads, they come with a trailer hitch installed and many feature a hands-free lift gate. Bed lengths vary, with most manufacturers offering short, standard, and long lengths.
- Cargo vans: A cargo van features seating for one or two individuals in the cabin area of the van. Behind the front seat lies a vast open expanse for stowing cargo. The sides of the interior typically feature restraints for tying down cargo, so it cannot shift while the vehicle moves. Many automakers offer customization of these cargo vans, installing racks on the interior walls for tool storage, a common feature of plumbing vans.
- Transportation vans: A transportation van, also referred to as a passenger van, offers a bevy of seat rows, so many individuals can ride in it. A popular choice for sightseeing tour companies and churches, these vans typically transport 11 or more people. Larger van models that transport 16 people or more, including the driver, require a CDL to operate.
- Conversion van: A conversion van refers to a van with an area in its rear compartment for sleeping. Some of these vehicles may also include a portable toilet and a small kitchen area. These vans prove popular with service businesses that need to make overnight trips but want to avoid driving an unwieldy vehicle like an RV. A conversion van saves the company money on hotel rooms, too.
- Refrigerated trucks: Food delivery businesses use refrigerated trucks to ensure that their product remains pristine. The cab of these trucks functions just like any other truck, typically seating two individuals. The separate trailer stays chilly because it undergoes refrigeration by an attached cooling unit.
- Commercial SUVs: A commercial SUV looks like a personal SUV, but similar to the light-duty and heavy-duty truck difference, it comes ready to tow weighty cargo. Typically, these SUVs feature mid- to high-level trims, making them appropriate for executives who travel frequently, owners of construction firms, and attorneys and doctors who travel frequently.
- Chassis cabs: These powerful commercial trucks only feature a chassis and front cab that accommodates the driver. A few offer a passenger seat. Without a truck bed, this type of truck lends itself to easy customization by those who need a custom truck bed, such as towing services, wench operators, etc.
Getting Started with Your Fleet
When you need to learn about managing a fleet, it may help to start small. Choose your business’s first fleet vehicle, then learn the ropes of annual maintenance by using the maintenance plan offered by the manufacturer. Once your business grows, hire a mechanic to maintain your company’s vehicles. Always carry appropriate insurance and ensure that your drivers carry the proper driver’s licenses and insurance, too.