Tips For Reducing Vehicle Expenses

Operating service vehicles in a cost-effective and efficient fashion is critical to a PMP's success. Here are some practical tips for ensuring your company's vehicle expenses don't overwhelm your bottom line.


Jeff Fenner

Published May 11, 2017

Whether your company has a fleet of 20 or 200 service vehicles, the costs of keeping them on the road are significant.

For Jim Brown, program manager at Northwest Exterminating in Atlanta, Georgia, who manages a fleet of more than 375 vehicles that traveled 5.3 million miles in 2016, the challenge to keep costs in check and maximize performance is ongoing.

“With 25 service centers spread across three states it is important to maintain a good handle on our fleet management protocols,” says Brown. “That is why we are switching to a fleet management maintenance company to help us streamline our preventive maintenance activities, and keep our fleet and technicians up and running.”

While not all companies are in a position to outsource their fleet management or maintenance, Brown offers the following tips to help keep costs and headaches in check.

Investigate Competitive Pricing Agreements (CPAs)
If your company buys more than 15 vehicles annually, Brown suggests you contact vehicle manufacturers directly about deeper discount pricing and additional rebates. You can ask your local dealer to put you in touch with the correct people at the factory to see what options are available.

Know Who Is Doing Your Maintenance Work
Regularly review the vendors providing maintenance and repair services for your fleet and make sure pricing and service quality are meeting your needs.

“Time is the most precious asset a pest management technician has and sending your vehicles to a shop that is 20 minutes further just to save a few dollars can cost you in the long run,” says Brown. “Stay on top of your vendors and educate them on your business needs.”

Determine What Is Your Cost Per Mile
Today’s GPS technology allows managers access to a wealth of data showing how their fleet and drivers are performing. Use this technology to determine your exact cost per mile for operating and maintaining each vehicle, and you may discover areas where savings can be had and efficiencies earned.

Vehicle Disposal
When is the right time to turnover one of your service vehicles and purchase or lease a new one? Some factors to consider include are you investing significant financial resources in repairs and is vehicle downtime impacting your ability to service clients (and generate revenue).

“Every company is different when it comes to disposal and you have to determine what works best for you when it comes to timing, cash flow and the like,” says Brown.

Another important consideration is the brand value a well-maintained, newer model service vehicle possesses in a consumer’s eye.

In the 2016 National Pest Management Association Consumer Attitudes Survey, respondents offered some interesting opinions when it came to seeing a pest management service vehicle.

Clients with a service contract were more likely to say, when they see a pest service truck in a neighbor’s driveway, they are being proactive while those who have never used a pest control company are more likely to say they have a problem.

The point is, if consumers notice what type of vehicles are in their neighbor’s driveway, wouldn’t it make good business sense to make sure yours is the best looking, most professional one out there?


Sticker Shock: How to Look Beyond Start-Up
Costs for A GPS System


Selecting and deploying the latest in computer software, mobile phone or vehicle GPS technology does come with a price tag that can cause owners and managers to swallow hard.

Overcoming the initial financial investment should be easier when you consider the long-term financial and operational benefits GPS technology offers.

“You want the fleet to take care of itself and GPS technology gives managers the tools to do that,” says Northwest’s Brown. “The depths of data managers have access to through GPS on a daily basis is impressive. Once you identify what data is most important to your operation you can begin to improve driving behaviors, gain efficiencies and realize savings.”

From information on start/stop times to idling to safety-related actions such as harsh breaking, accelerating and turning, GPS data tells an important story but how do you make it work financially?

Brown says companies can look at purchasing or leasing GPS systems – 36 to 48 month contracts are standard - depending on cash flow and other considerations. According to Brown, the majority of pest management companies opt to lease the equipment (Northwest leases) paying more up front but with lower monthly costs. Leasing can also provide tax advantages but each company must decide what works best on their balance sheet.

Brown also recommends selecting a plug-in system that does not need to be hard-wired into the vehicle. He says uninstalling a system when you go to sell the vehicle can be time-consuming and expensive depending on the number of units.

Finally, Brown recommends researching the manufacturer’s customer service support system – is it handled internal or by a third-party? Response time when you have a technical issue on one of your units is critical because vehicle down time equals technician down time which results in lost revenue.

“Do your research and ask questions before committing to a system,” says Brown. “The upfront investment might look steep but in our case we realized savings immediately.”

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