For many small businesses considering fleet management, buying vehicles may seem the best plan of action. However, when using your own vehicles – maintenance, repairs and associated costs lie solely in the hands of the business owner. The business also has total responsibility for the acquisition and disposal of vehicles – diverting cash flow from critical areas of business management.
Many businesses purchase used vehicles to cut down on expenses, but this approach is costing SMEs significantly down the line. Almost half (45%) of the total GHG emissions from road transport in the EU comes from company fleets, which is the result of the sector’s reliance on fuel inefficient vehicles. While leading to poor fuel management, used vehicles are also more prone to breakdowns and fleet downtime, resulting in costly repairs. As highlighted in LowCVP’s report, by choosing the right fleet vehicle, businesses can save up to £18,000 throughout the vehicle’s lifetime.
The cost of vehicle maintenance and downtime is costing businesses thousands. According to research from RAC Business, having vehicles off the road is costing UK SMEs up to £500 a day, equating to hours of fleet downtime – time which no business can afford to sacrifice.
Worryingly, many are unaware of the costs associated with vehicle ownership:
“Our research reveals that many of the UK’s small businesses are seriously miscalculating the true cost of maintaining their fleets, large or small, and in most cases spending far more than is necessary.” Alan Maloney of Ford Retail.
As businesses struggle to budget for the costs of big fleet management, fleet hire offers greater business agility, financial control and flexibility.
Summarised by The Why Buy? Report: “for most businesses, commercial vehicle rental would be more cost effective than purchasing”.
Keeping your vehicles on the road
Vehicle maintenance and repairs is often the most costly area of fleet management. Surprisingly, tyre problems are to blame for 21% of all breakdowns. Simple, easy to fix issues such as under inflated tyres are regularly going undetected by businesses, causing mounting problems further down the road.
When your fleet vehicles aren’t serviced properly, further problems can occur – increasing the downtime of your fleet and inevitably the cost to your business.
Most fleet leasing services include a dedicated maintenance plan as standard and we personally operate a ‘keep you on the road’ philosophy. Our team of dedicated specialists are on hand 24/7, 365 days a year to offer your business quick and effective breakdown and repair services, keeping downtime to a minimum.
Flexibility
A common misconception about vehicle leasing is that flexibility is limited. However, with a leasing company like Burnt Tree, a number of flexible rental terms are available to suit your business needs, meaning you are never tied into lengthy un-breakable contracts. You can also return vehicles or exchange for the latest models without any penalties or additional costs.
Our flexible leasing allows businesses to financially plan ahead, without the fear of unplanned maintenance bills – cutting down on one of the largest areas of business spending. When using leased vehicles exclusively for business, you can also claim back 100% of the VAT, while lease payments are tax deductible.
With over 30 years’ experience working with small businesses, we appreciate that no two businesses are the same and each require specific needs catered to their business model, goals and budget. For more information on how our bespoke fleet management services can help you save money, contact us
