The Intangible Value of Fleet Management Solutions
The decision to make a technology investment purchase can be complex and often dictated by pricing. Financially, a firm would likely label the purchase as a business expense, as denoted on the income statement, rather than as an asset on the balance sheet.
Expenses are shown on the income statement for management as the “bottom line” of the company. Business expenses are subtracted from incoming revenues to show how much was earned (or lost) over the period. However, lasting benefits (such as future cost reductions) of a new technology is not typically taken into account when processing the original expense.
The upfront costs may be accounted for but one must also examine the intangible future benefits of the technology. Using fleet management solutions provides numerous paybacks to a business. Acting as an intangible asset, one that adds economic benefit and value over time, the fleet management solution has a direct impact on businesses bottom lines.
Savings can be easily seen in multiple areas. At GPS Tracking America, partnered with Geotab, the savings have been identified as coming from 4 core pillars:
This includes making the best use of all assets available and optimizing driver management. Costs savings, in turn, can be realized from reduced fuel usage and greater MPG consumption.
Driver Safety Maximization:
Through our interactive driver training methods, drivers are constantly reminded of the best safe driving practices. For example, in-cabin ‘beeps’ will inform the driver to reduce their speed and/or put on their seat-belt if it is forgotten. Not only will this cut down on costs but it also helps businesses reduce vehicle damage and employee injury claims.
Enhancing Driver Productivity:
Getting more done during the day leads to long-term loyalty and customer satisfaction. This allows businesses to reduce their churn rates and improve their gross profit margins.
For businesses operating inter-state, being HOS compliant is not an option; the value comes at no surprise as damaging and costly penalties can be avoided. Fleet management solutions provide vast savings in many ares of the company making it so much more than a little black box.
Investopedia Definition: Intangible Asset