Business Driving and Major Inefficiencies

Fluctuating national gas prices are but one part of the immense puzzle facing businesses dependent upon in-house transportation to make their profits. Far too many reimbursement solutions and fleet management systems result in major inefficiencies, wasted profits, unsatisfied drivers, and administrative headaches. In this blog post, we will take a look at the best ways to cope with the realities of business driving, from national gas prices to driver morale.

1. National Gas Prices. With a flat reimbursement only, fluctuations in national gas prices immediately generate an unwinnable situation; even if you were to try to crunch numbers and develop a somewhat reasonable ‘one-size-fits-all’ cents-per-mile solution for reimbursing your drivers, you’d inevitably find yourself overpaying drivers in some regions and underpaying drivers in other regions.

This can lead to considering a corporate fuel card, which is not an ideal solution because it is impossible to identify the gas that was used for personal `(not business) mileage.

By adjusting part of your payouts based on regional gas prices and fluctuations in the market, you bring your payouts in line with actual expenses—cutting waste while maintaining worker satisfaction.

2. Driver Inefficiency. When you put drivers behind the wheel of vehicles they don’t favor, they perform less efficiently and cost you money. This is the world of company car fleets.

Consider what else company car fleets come with — administrative overhead, heightened liability, and a loss of driver efficiency – and it becomes apparent why businesses opt for Vehicle Reimbursement Plans.

3. Administration. Administration for the type of dynamic reimbursement system which compensates for changes in national gas prices can be difficult to keep up with. Dynamic technological solutions have become increasingly important for businesses looking to optimize their transport efficiency. These innovative solutions make it possible for a firm to quickly assess changes in gas prices along routes, different licensing requirements in various regions, maintenance cost differences, and other fluctuating costs which resulted in over- and under-compensation of drivers in the past.

These solutions make vehicle reimbursement policies far easier to maintain and organize than before, making them an increasingly popular choice.

5. Optimizing Reimbursement. Companies continue to move toward vehicle reimbursement strategies built on a combination of fixed-rate reimbursement for costs such as the cost of a standard vehicle, and variable-rate reimbursement taking into account shifts in gas prices, vehicle wear and maintenance.

Dynamic databases such as the CarDATA Smart Database make keeping up with variable expenses and providing the correct reimbursement relatively easy.

Need to Know More?

Looking to learn more about optimizing your business transportation efforts, utilizing a variable rate vehicle reimbursement strategy, or the CarDATA Smart Database? Check out our Learning Center or our blog, or contact CarDATA directly for more information.