A business plan is the most essential thing for starting any business.
It defines exactly where the business will go, and how can the business reach there.
When the plan is written on paper you get a definite idea about what exactly is covered and what more is to be done to ensure your best chance at getting success.
1.Business Plan And Things To Include
Having a business plan is important because most of the financial institutions may not even consider supporting your startup for funding until they go through the plan and approve it.
So for starting a fleet management business, having a business plan is the first step.
The issues that you need to address includes the exact type of your business, type of your market, financial outlook, customer base, marketing plan, and your driving team.
Financial analysis is yet another aspect to be considered that lets you understand the exact amount to start the fleet management business. Analyzing the upfront financial requirement and the growth potential of the market will help you negotiate while making final deals and still help you to remain flexible.
Depending upon the account, as the fleet maintenance administrator you can decide how much labor can be paid, what will be the rate of payment, and so on?
3.Fulfilling Regulatory Compliance Requirements
For starting a company, there are several regulatory details that must be completed.
These include getting authority from the local department to operate state lines.
In any case you are planning to operate in multiple states, you will have to fill up all the required forms and get permission so that your vehicles can run across the country without any obstacles.
Also, understanding all the guidelines and training your drivers & staff about how the regulatory compliance works will ensure that your fleet management business is never trapped in any legal hassles.
4.Coming Up With Pricing Menu
It is quite easy to set up prices for the other parts of your shop if you are managing both the fleet management as well as repairing and spare parts department.
But when it comes to working exclusively in a fleet management business, you need to have a clear-cut picture as to what you can afford to discount so that in the long run it will help you get a larger amount of work and ensure a strong flow of cash.
5.Clear Payment And Working Terms
All the terms should be clear upfront irrespective of whether it is about the hours of work the drivers are working, their payments, incentives, parameters for getting increment and so on. This is regarding internal payment.
But your dealings with clients should be clear and up front as a misunderstanding or delayed payment may lead you to lose credit and a good client.
It certainly can have a huge impact on the success of your business and as a startup, you can never afford it.
According to experts, the documentation provided to the clients should clearly state your expectations right from the start to avoid any confusion or misunderstanding.
6.Give Importance To Building Relationships
All the companies succeed mostly on great relationships with your employees and clients both.
So from your fleet clients to every decision maker in your company including the mechanics and technicians maintaining your fleet as well as your drivers, everyone is equally important.
Give prior importance to them and to ensure a strong bonding make regular communication as a part of your daily schedule.
For a good rapport with the clients, just drop in to check how your company can provide them excellent service and more options. Inviting them for your business events and get-together can also help to serve the purpose.
7.Choosing Right Equipment/Vehicles
The type of freight you are planning to haul will decide the kinds of equipment you will need. You need to think of how much loads the truck engines can accommodate or how much capacity your trailer should have?
Other options such as flatbed trailers, regular trailers, car hauler trailers, or refrigerator trailers should be checked for their capacity and see whether such additions can make your fleet additionally balanced.
8.Inspecting Vehicles Properly
Physical inspection is very much necessary prior to buying a vehicle. Inspect the engine, windows, tires, and doors and other exposed surfaces of the vehicle for any signs of rust. An extensive test drive of the truck or a trailer you are buying is also important.
9.Whether To Purchase Or Lease?
When you are a startup company, leasing will certainly ensure that you save money as well as time.
Leasing cuts down the amount required as upfront capital and you are relieved from going beyond capacity to arrange for funds.
Rather when you opt for a short-term lease, it gives you an opportunity to gain experience of running a full-fledged fleet management business with specific vehicles like trailers and tractors.
From this experience, you can evaluate how you can fulfill the needs of your business prior to purchasing your own fleet of vehicles.
However, there are a few disadvantages of leasing that you must keep in mind.
Since you do not own the trucks/vehicles, you cannot fully control the way they are maintained or used.
Secondly, you have to follow the guidelines of the leasing firm. But the option to get vehicles on lease is still a bit better than making a bad purchase and regretting later.
10.Hire Drivers As Employees Or Add Them As Sub-contractors
You have two options for starting a fleet management business. You can hire skilled drivers or bring sub-contractors on your board. Both of them have their plus and minus points. If you are short on budget, the best way is to get drivers as independent operators/owners as subcontractors.
Since these drivers own their trucks, your company will be saved from paying for expenses such as maintenance, insurance and so on.
But the downside is that you will be paying higher fees to the drivers and will also have less hold over their behavior as compared to those drivers who are on your payroll.
Following all the above steps for starting an enterprise fleet management business is quintessential to make it a success. But you can ensure more efficiency and high-quality service by adding a best fleet management software to your regular operations.