We recently exhibited at this year’s CFMA Annual Conference & Exhibition, which took place from June 23 - June 27, at the Fontainebleau Miami Beach, a beautiful venue, on the beach in Miami. Packed with classes and workshops for the attendees, the conference provided valuable educational opportunities—these included general sessions, mini-conferences, breakout sessions, advanced sessions, and dawn peer groups. The five-day conference schedule was organized to allowed attendees to view the exhibition area on three of the conference days, and specific hours set for attending classes and workshops.
The conference was centered around the construction and financial management sectors, and those who visited our Union Leasing booth had an opportunity to learn more about fleet management as it relates to the construction industry. We were fortunate to see a few of our current customers, who brought some of their peers by, to talk about the benefits we bring to their businesses. As mentioned, most of the attendees were related directly to the construction industry, or serve as support or service to the industry. With this captive audience, who maintain a fleet, we could explain the major differences and benefits they would experience when partnering with Union Leasing.
Below are some of the important themes and topics at CFMA 2018, in relation to fleet management:
A data-driven approach to fleet management is important for making informed decisions
Many companies are managing their fleet without a comprehensive cost analysis. That analysis assures companies they pay the lowest amount of monies to operate their fleet. A professionally managed fleet monitors this analysis and adjusts, when needed, on a continuing basis. Each company has specific needs that change along with the automotive industry. Only experienced fleet management consultants know how to mesh together these changes, and make the right recommendations to fit those needs. Determining the best vehicle, its options, and optimal cycle time, are a few of the items considered when attempting to reach the lowest cost of ownership.
The cost of conventional financing vs. leasing vehicles
An interesting conversation we had with some of our booth attendees revolved around the cost of conventionally financing a vehicle versus the cost of leasing a vehicle. Many companies were already financing vehicles, but some expressed the cons associated with that, some of which were:
- The burden that comes with owning and internally managing vehicles on a day-to-day basis.
- Cash flow impact.
- Tracking vehicle transactional costs for both efficiency and compliance.
- Lack of controls.
It’s important to note, though, that most companies with a sizable fleet are currently using a fleet management company.
Managing fleets in-house vs. working with a fleet management partner
Some customers choose to manage their vehicles in-house. They acquire their vehicles through dealerships, and manage all transactional costs in house. However, the dealership’s salespersons with whom they speak sometimes vary. Additionally, they have limitations to the manufacturer they represent. Their expertise generally isn’t comparable to that of a fleet management partner.
Some of those who dropped by our booth, manage their fleet in-house with part time administrators. Most agreed this was difficult, and led to errors, which can sometimes take hours to undo, and can affect legal or insurance compliances.
It all comes down to cost-savings for the customer
Apart from the challenges that come with financing vs. leasing, or whether a company chooses to work with a fleet management partner or manage their fleet in-house, other points that some of the people we met expressed were: determining the right time to cycle vehicles, and the correct vehicle for the job task. Whether the customer gets the applicable incentives passed through to them, and whether their current managers are experienced enough to know what the additional costs will be incurred by the customer (e.g. management fees).