Vehicle Fuel Management

How to gain tighter control of fuel expenses


Since mileage can be logged with each fleet account, fleet card reports can also identify a change in a vehicle’s performance, for example, if a particular make or model is excelling over another or needs to fuel up more often, which would indicate it may be in need of repairs due to inefficiencies.

Just like in maintenance and vehicle performance tracking, challenges with employee’s driving habits can also be identified through fleet card reports. This provides fleets with an opportunity to work with these drivers to improve driving practices to maximize fuel efficiency, he says.

LESS PAPERWORK

Xcel Energy is a utilities giant that provides a comprehensive portfolio of energy-related products and service to 3.4 million electricity customers and 1.9 million natural gas customers across eight states in the U.S. It maintains a fleet of more than 5,700 cars, trucks and vans and an expansive network of mechanics and suppliers.

For years, Xcel Energy faced a dilemma shared by many fleets. The process of maintaining and servicing its fleet of vehicles involved a complex paper trail of purchase orders and invoices for parts and services, including thousands of small-dollar and high-volume transactions. Employees would submit receipts for parts or services to the accounts payable team – sometimes late, resulting in missed payments.

A fleet can’t control the price of fuel, but it can control its fuel consumption through practical fuel management programs and systems.

Efficient tracking of those expenditures, some for as little as $10, had become nearly impossible.

Beth Hill, director supply chain process control, and Mark Hennesy, fleet director, decided to implement a corporate fuel purchasing program, and turned to BMO Spend & Payment Solution – a leading commercial card, spend and payment solutions provider in North America, and its Purchasing Card (P-Card) program. The program gives Xcel Energy visibility into transactions and reduces the number of missed payments and expensive manpower to manually track all of the receipts, they say.

The joint team from Xcel Energy and BMO identified three goals in the initial planning:

  1. Get bills paid on-time and provide the ability to procure parts and minor services with lower administrative processing costs, and simplify expense analysis.
  2. Increase the visibility of transactions online within 24 to 48 hours, and load data directly into a fleet management tracking system.
  3. Remove transactions from the accounts payable (AP) system that did not need the expertise of a seasoned procurement professional.

The P-Card program cuts down on the number of invoices processed in the AP department and eliminates duplicate payments and other accounting problems, say Hill and Hennesy. The program is also empowering, as it puts the tools in the hands of the employee who need to make purchases.

The fleet card program takes advantage of BMO’s Details Online, which gives visibility down to the work order, supporting centralized equipment lifecycle management.

Xcel Energy AP team is “awed” at the sheer volume of paper – and paper touch-points – the fleet card program has eliminated, directly supporting a corporate-wide ‘green’ initiative, Hill and Hennesy say. The program has taken some 20,000 annual transactions – each involving paper invoicing and paper check payment – fully online, including internal monthly reconciliation with users of the P-Card.

PRODUCTIVITY INCREASE

In the heating and air conditioning services industry, productivity relies on fleet efficiency. If drivers must spend time searching for a specific, fuel-only provider and then make additional stops for convenience items, they spend less time on service calls – and the business loses opportunity for additional revenue.

Couple that lost time with the additional associated mileage and fuel expense, and the out-of-pocket costs begin to quickly add up. Multiply that by a fleet of 45 vehicles, and that was the situation an Arizona HVAC company faced.

To make fueling faster and cheaper for its fleet, this Phoenix-based company was using a commercial fueling membership that joined together as one brand several independently-owned, unattended, fueling stations throughout the city. When the company’s general manager took a hard look at the fueling program he found it had inefficiencies that were costing both time and money.

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