Outsourcing Can Help Control Fleet Costs

CHICAGO, IL — While some companies are hesitant to outsource because of the perceived additional costs, in reality many companies with small to mid-size fleets are finding it can be more economical to outsource fleet management than to handle the added responsibilities in-house. The bottom line is that outsourcing can save companies time and money.

For Scott Templin, president and general manager of Temperature Service Co., a commercial and industrial mechanical contractor in Elk Grove, IL, overcoming an initial resistance to outsourcing has proved to be not only a sound financial decision, but also one that has saved valuable time. Temperature Service’s 40-vehicle fleet is comprised primarily of service vehicles.

Temperature Service chose Enterprise Fleet Services, a division of Enterprise Rent-A-Car, as its provider after Enterprise was selected in 1999 as the preferred vendor for fleet management for the Excellence Alliance Inc. (EAI). EAI is a national membership organization committed to maintaining and creating opportunities for independent contractors and providing them with a network of resources.

Enterprise specializes in providing local fleet management services for companies with 15 to 125 vehicles. Enterprise’s capabilities include vehicle acquisition, registration and reporting, risk management, vehicle disposal and remarketing, maintenance, and fuel management.

SERVICE CUSTOMERS INSTEAD OF VANS

While Enterprise is able to offer Temperature Service additional discounts on vehicles as a preferred vendor for EAI, Templin has experienced other ways to control costs through his fleet management program. For example, in addition to taking advantage of various fleet incentives, Temperature Service learned it qualified for a free commercial bin package offered through General Motors Corp.

“With the assistance of a local vendor, Enterprise was able to customize the aftermarket equipment to meet our required specifications, saving us an additional $2,000 for each van that required additional equipment,” said Templin. “This not only saved us money, it saved us considerable time.”

Like many others in the industry, Temperature Service had been outfitting the interior of its vehicles in-house, buying all of the materials and fitting the interior with specialized internal racks, bins, and flooring.

“Not only did this cost us more in materials, it prevented our employees from generating revenue because they were working on our vehicles instead of making service calls to help customers,” said Templin. “Enterprise delivered the vans ‘turnkey’ and ready to hit the road on the day of delivery, in addition to assisting in coordinating vinyl graphic signage to the outside of the vehicles, which also added value to their delivery service.”

MAINTENANCE PROGRAMS

Temperature Service also outsources vehicle maintenance, using a combination of two different maintenance programs offered through Enterprise. “We participate in a maintenance management program for our older vehicles that helps control costs through consolidated billing,” said Templin. “And for our newer vehicles, we know our fixed costs through 100,000 miles per vehicle, so we don’t have to spend our own time tracking maintenance and matching invoices.” Templin stated that together these programs have reduced the company’s overall maintenance expense by approximately 15% annually.

For more information, visit www.enterprise.com/fleets (website).

Publication date: 11/18/2002