Controlling Fleet Costs Through Metrics
By using systems that monitor maintenance, advertising, payroll and job tracking, Joe Christenson has improved his fleet's efficiency and alleviated the need to outsource fleet management.
Celebrating 25 years in business, Joe Christenson, owner of Plumbing Plus and Remodel Works Bath & Kitchen in Poway, Calif., has firm control over his fleet by using systems that monitor maintenance, advertising, payroll and job tracking.
By doing so, Christenson has saved 20-25 percent on maintenance costs, improved productivity and fleet efficiency and alleviated the need to outsource fleet management.
Suit the Truck to the Technician and Task
Between the two companies, Christenson operates a fleet of 33 vehicles-10 with Plumbing Plus and 22 with Remodel Works-including ¾- to 1-ton GMC Savana utility van chassis with 10-foot utility bodies, regular Savana vans and ½-ton pickups with 8-foot utility caps and bed rollouts.
The types of trucks are generally outfitted to each task and the skill level of the employee for both the plumbing and remodeling companies. Master plumbers, "jacks of all trades," use the utility bodies because those trucks are the most versatile. "Journeymen" plumbers who perform smaller jobs such as drain calls and water heater repairs use the vans. Apprentices and technicians who perform a single task such as drywall or demolition use the ½-ton pickups.
Vehicle Procurement Strategy
Christenson has relationships with two dealers who specialize in truck utility beds, and he buys off their lots. Christenson looks for deals by waiting for model changeovers when the "blow-out specials" are offered on the aged new units.
Christenson had been buying late-model lease returns from auction, but he found that buying new was the better deal. The difference in price between a heavily discounted new truck and a used unit was only around $4,000, and the new units had the full warranty.
Christenson pays cash for his vehicles instead of leasing. "If I was making $500-$600 lease payments on 22 vehicles right now, I'd be in big trouble," said Christenson. "My philosophy was that when I was making money, use it to pay cash on the vehicles, because it wasn't a matter of if, but when the economy was going to turn."
Christenson recently purchased his first diesel van chassis and transferred the utility body from the older truck onto it. The fleet achieves 10-12 mpg on the utility bed vans and 15-16 mpg with the diesel.
For fuel purchases, Christenson uses an Arco fleet card. He analyzes the monthly reports to track miles per gallon.
He uses the local Auto Trader to sell his trucks. As he is "running the vehicles into the ground," Christenson says he's less concerned with the residual value on the back end. Though the retired units have high mileage, they're well-maintained and sell for a good price.
He's not selling right now. Instead, he is keeping a couple of trucks on hold to use as replacement vehicles if needed. Christenson will make the decision to keep or sell the trucks in the next few months, depending on the economy.