How delivery fleets can reduce fuel costs for SMEs

Small businesses running small-to-mid-sized parcel delivery fleets can save on fuel bills by optimising their delivery fleets using technology.

As fuel costs hit new highs margins are being further compressed. It’s the last thing many small businesses need. The benefits of being more efficient in your parcel deliveries have never been greater.

Efficiency benefits from telematics technology include route optimisation and vehicle monitoring, which can also save fuel. Fleets that aren’t optimised waste valuable time and money taking inefficient routes, and have a higher incidence of lost or misplaced deliveries.

Telematics can provide information on fuel use, including data on excessive idling in vehicles. The technology has benefits for business intelligence: track parcels, assist with proof-of-delivery, and track vehicles and machinery to ensure they are being used properly.

But why is take-up of telematics still low among smaller businesses? The costs regarding missed efficiency gains add up significantly over time. Research suggests many smaller to mid-sized delivery fleets do not employ this technology, even while the cost of this tech has fallen and is now accessible to the smallest delivery fleets.

The recent Isuzu Future of Trucking Report, which claims to be the largest road transport survey ever undertaken in Australia, found 29 per cent of businesses are using data to manage fleets more effectively. Of these, larger delivery fleets with 20-plus trucks were most active.

According to the report, fewer than one-third of fleets with 1-5 vehicles (27 per cent) used data to manage their fleets and only 18 per cent were investing in fleet management technologies. Fewer than half of fleets with six to 20 vehicles (41 per cent) used data to manage their fleets, and only 28 per cent were investing in fleet management technologies.

This is a missed opportunity for these smaller to mid-sized fleets to make genuine efficiency gains.

At Ontime Delivery Solutions, we have seen many transport divisions improve their delivery processes via telematics, with gains regarding efficiency, customer service, and safety. Many of these have had fewer than five vehicles in their delivery fleet.

They have been able to do more with less, and have become more flexible to deal with fluctuations in demand.

But telematics take-up is only the first step to efficiency, with many fleets not getting the most out of existing systems. Telematics technology is only as good as the effort you put in. If you pay it consistent attention the rewards can be significant over time.

The most successful fleets have a structure for success. They have genuine control and flexibility by choosing their delivery transport partners wisely.

They can try out new delivery runs without breaking the bank. They eliminate their fixed transport costs where possible, and take most of their transport liabilities off their balance sheet.

There are enough reasonably priced telematics solutions that it’s possible to dip a toe in the water without making a huge financial commitment.

Efficiency will be key for small business as we navigate an uncertain and likely unpredictable economic rebound, which could include further lockdowns, higher inflation, and unforeseen changes in consumer behaviour. With fuel costs now biting hard, it’s a good time for fleets to re-consider telematics