3 Key Efficiency Indicators for Fleet Managers

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Efficiency indicators also known as key performance indicators (KPI) is any measurable value that demonstrates how efficiently your fleet is operating and helps you meet your business objectives. The changing nature of the fleet industry means that fleet managers can easily be over-burdened by their work, making the identification of performance indicators very important.

Several indicators are used by fleet manager to achieve profitability and optimum efficiency.  But the three we will talk about are; fleet utilization, cost per mile and on-time delivery percentage. Efficiency indicators also known as key performance indicators (KPI) is any measurable value that demonstrates how efficiently your fleet is Efficiency indicators also known as key performance indicators (KPI) is any measurable value that demonstrates how efficiently your fleet is operating and helps you meet your business objectives. 

The changing nature of the fleet industry means that fleet managers can easily be over-burdened by their work, making the identification of performance indicators very important. Several indicators are used by fleet manager to achieve profitability and optimum efficiency.  But the three we will talk about are; fleet utilization, cost per mile and on-time delivery percentage.

  1. Fleet utilization is a key measure of fleet management that shows the actual amount of time that an asset is actively being used verses the available time that a unit could be used. While it’s unlikely that a fleet will reach 100% utilization of any of its assets, there are some techniques that can be applied to your trucks to get utilization rates as high as possible. These techniques include knowing; the volume of product your truck or trailer can carry, the customer service requirements that you need to meet, your driver’s available hours of service.
  1. The cost per mile measure analyzes the total spend in a category and equalizes that total to determine what each individual unit costs to own and maintain. Thus, it indicates the cost that incorporates both how much it costs to operate an individual truck and how frequently that asset is utilised. This is indicator is particularly important because not all material handling or industrial assets can provide exact utilization. The indicator also helps identify expensive fleets as compared to other fleets which are performing the same duty.
  1. On-time delivery is becoming ever more important in business. But the answer isn’t to deliver more quickly; it’s to deliver more predictably. The On-Time Delivery (OTD) percentage indicator helps you keep track of how accurate your deliver time estimations are, and whether or not your deliveries are getting to their destination on time. OTD refers to a range of dates defined as X days before (early) and Y days after (late) the due date. The two main factors that influence the OTD indicator are production line requirements and cash flow. Defining OTD is the starting point, but over time measuring OTD is the real challenge.