Is a Fleet Card Right for Your Small Business? An In-Depth Evaluation

Operating a fleet of work vehicles represents a major expense for most small businesses. According to a FleetCarma industry report, fuel and maintenance alone for light-duty trucks runs $8,617 per year per vehicle. With large fleets, costs add up fast.

Unfortunately, many businesses track and manage these vehicles inefficiently. Company credit cards or petty cash used to pay for fuel and service lack controls. They create headaches for finance teams when reconciling driver purchases and submitting expenses.

This article dives into how implementing a dedicated fleet card program helps small businesses rein in costs and optimize their mobile assets. Let‘s analyze what features matter when deciding if the time is right to upgrade your systems.

Breaking Down Fleet Vehicle Expenses

Before evaluating technology solutions, it‘s important to understand cost structures. Across commercial fleets, the largest segments include:

Source: FleetCarma 2022 Fleet Industry Report

We see 51% of spending directly ties to fleet usage – mainly fuel and maintenance. This presents the biggest opportunity for better oversight and savings. Fixed costs (depreciation/insurance) relate more to asset management strategy.

Without a specialized program, businesses struggle controlling fuel and maintenance bills. Company cards lack reporting to tie spend back to usage metrics like vehicle miles traveled. Drivers could pump premium grade fuel without their manager‘s knowledge.

Conversely, a fleet card system provides:

• Itemized transaction data for accurate spend segmentation
• Driver and vehicle tracing connecting expense to usage
• Alerts and corrections notifying unauthorized purchases

Access to more granular data combined with corrective mechanisms directly enable better fiscal discipline. Businesses gain visibility connecting expenses to utilization rates across the fleet.

Now let‘s see how major fleet card providers help small businesses rein in costs.

Fleet Card Supplier Feature Comparison

The leading fleet card suppliers provide specialized monitoring, analytics, and policy tools tailored to fleet management. But their offerings differ – so how do you select the right one?

Let‘s overview core capabilities from major brands to understand key decision points.

We see WEX, Fuelman, and FleetCor own large shares of this market due to huge proprietary merchant networks guaranteeing card acceptance alongside discounted rates. Custom analytics and robust integrations also help steer management.

But how do these capabilities actually generate ROI for businesses? Where are the greatest opportunities to cut costs and improve oversight using fleet tech?

Realizing the ROI of Fleet Cards

Specialized fleet card programs pay dividends for even small operations through:

1. Increased Fuel Efficiency

Reviewing detailed MPG metrics allows managers to optimize routing for better fuel economy. According to FleetCor experts, differences exceeding 15% MPG get noticed between best and worst performing drivers. Retraining where needed quickly adds up.

Likewise, monitoring vehicle maintenance needs based on fuel usage data keeps the fleet operating efficiently. Engine issues directly hurt MPG.

Small efficiencies per vehicle multiply over months and years transforming overhead.

2. Reduced Unauthorized Spending

Unapproved transactions also drain budgets fast. Restaurant charges or premium fuel selections alone can drain thousands annually if gone unchecked.

In one client example, a small HVAC company spotted over $3,400 in likely fraudulent transactions within 6 months of reviewing new fleet card data. Preventing this waste going forward represented nearly a 50% reduction in annual fuel outlay after factoring typical bulk discounts.

3. Tax Reclamation Opportunities

Many businesses miss out on recoverable fuel taxes embedded in transactions. Fleet cards provide detailed data to identify these savings. Specialized partners even handle documentation and filings to secure eligible rebates.

Permerchant fleet tax experts estimate over $110 in unclaimed taxes exist per vehicle based on typical monthly mileage rates. This represents found money leaving no reason for businesses not to claim it.

Best Practices for Implementation

Now that the benefits are clear, what should small businesses prioritize when deploying programs? Follow this strategic sequence for optimal adoption:

1. Define Management Goals

• Reduce outlay on fuel/maintenance?
• Tighter oversight on unauthorized transactions?
• Streamline expense reporting?

2. Calculate Existing Fleet Spend

• Fuel and maintenance bills across vehicles
• Miles driven and MPG estimates

3. Model Discount Opportunities

• Compare potential merchant rebates and bulk rates from major brands

4. Audit Features vs Needs

• Evaluate toolsets strengths in relation to your workflow gaps
• Check integrations for routing data into accounting and payments
• Request demos and free trials to test capabilities

5. Phase Rollout

• Start with pilot vehicles/drivers to refine policies
• Expand program across fleet while continuing to optimize

Following this methodical process ensures maximum program effectiveness and adoption. It also positions managers to continue improving oversight using the rich analytics available.

Key Takeaways

Fleet cards provide small businesses a valuable toolbox for managing mobile assets and employees more efficiently. Key advantages include:

➔ Detailed fuel data assignable by vehicle and driver

➔ Alerts automatically flag unauthorized transactions

➔ Fuel discounts averaging 2-10% off retail pricing

➔ Integration with accounting platforms like QuickBooks track spend

➔ Improved tax recovery potential around fuel expenditures

Consider if challenges around expenses, reporting, or utilization currently impede your fleet operations. Modern fleet card systems directly address these pain points to help small businesses optimize costs.

Conclusion

Managing fleet vehicles represents a sizable operating expense for small businesses. However, too often management practices remain messy relying on company cards and manual reporting.

As this guide outlines, purpose-built fleet card programs provide tracking, analytics, and controls to rein in costs. They incentivize drivers and managers to make better fuel purchasing decisions. Integrations also automate data sharing with accounting systems.

Review the representative features table comparing major providers when evaluating technology options tailored to your needs. Just be sure to follow best practices around calculating spend baselines, modeling discounts, and phasing deployment.

With the right fuel card partner, small businesses can realize substantial savings and efficiency gains across their mobile assets for expanded growth and profitability. Those wheels keep your business moving so invest in systems allowing comprehensive oversight for maximum ROI.