How to use a fuel management system to start cutting costs today

Fuel management is the process of monitoring, calculating, and optimizing fuel usage in private or commercial vehicles. Delivery fleets, couriers, and field service teams use fuel management to increase revenue as well as cash flow. The general public uses fuel management to minimize recreational expenses.

Fuelchief Sapphire FMS being used to created fuel efficiencies for Tyre Doctor in Australia.

Fuel management is an important process because it gives you control over an essential expense. Fuel charges are unavoidable, but that doesn’t mean you’re powerless to mitigate them. Here are two major benefits of improving your fleet’s fuel management system:

1. Increases profit margins

Fuel management increases profit margins by minimizing expenses. Fuel costs add up quickly, especially if you’re driving 100+ km per day.

One study conducted by NZ Business found that fuel costs made up almost 30% of the total average marginal costs within the transport industry—more than insurance premiums, tolls, repairs, maintenance, tires, permits, and licensing expenses combined. That’s a large chunk of overall spend, so anything you can do to reduce that dollar amount will result in higher profit margins.

2. Provides actionable data

When you practice fuel management, you monitor and access data in order to make smart fueling decisions. Fuel management (such as Sapphire and Everlink) is itself a method for extracting solid, actionable intelligence.

Businesses may use fuel management analytics to see which of their drivers are “pedal heavy” and which of their drivers are the most efficient. You can use fuel management data to make informed decisions about territory divisions, traffic patterns to avoid, and which drivers are most deserving of a promotion. Leadership teams can even use fuel management data to adjust capacity plans and scale operations. Not to mention the easy access of information across cloud-based platforms for those across the company (finance, logistics, operations etc).

Fuelchief Sapphire being used at Golden Contracting to monitor fuel for their fleet of haulage trucks.

Luckily, you don’t need to pore over spreadsheets or be a mathematical genius to find ways to reduce fuel consumption in modern society. You just need the right technology. Businesses with fleets of all sizes use route optimization software and fuel management systems to get actionable data in minutes or even seconds off a cloud-based FMS. The main ones that have been tried and tested are listed in our Fuel Management category, popular models are:

• Everlink AFM
• Everlink Solar
• Sapphire Lite
• Sapphire Online

Tracking in Fuel management industry via apps and cloud based technology.

Software takes most of the tedious work out of the equation, but that doesn’t make fuel management something you can “set and forget.” Use the following strategies on a consistent basis to maximize your fuel management efforts:

1. Optimize routes

Optimizing routes literally means taking the best route for your intended purpose (which, in this case, is saving on fuel costs). Your goal should be to take the shortest and, therefore, least expensive route possible.

2. Upgrade your fleet

Your vehicles could be the source of a lot of wasted spend. Consider upgrading your fleet to fuel and eco-friendly vehicles or even diesel vehicles. Firstly, Electric and hybrid vehicles often require far less power to travel the same distance as similar vehicles with conventional gas engines.

Secondly, it may also make more sense to invest in diesel vehicles, depending on where you live and the size of the vehicles in your fleet. Diesel engines can be up to 25% more fuel efficient than regular gas engines and last longer. Diesel fuel prices can also be cheaper than petrol, but this depends greatly on where you live.

That said, some companies that only have the option of petrol (and diesel) vehicles can benefit from onsite refuelling which cuts labour costs, down time, fuel and can even provide a new income stream for businesses instead.  This calculator highlights the savings you can make directly for your business.

3. Maintain vehicles

Simple but sometimes overlooked maintenance checks can have a big impact on fuel economy. Here are a few examples of vehicle maintenance you can perform to cut down on fuel costs.

• Check your vehicles’ tire pressure regularly to increase gas mileage by as much as 3%.
• Switch to your vehicle manufacturer’s recommended motor oil grade to save on fuel costs by as much as $0.10/litre.
• Schedule regular engine tune-ups
• Add preventative vehicle maintenance to your routine and rack up some serious savings.

4. Use cost-minimizing driving tactics

Train your drivers in fuel efficiency. Bad habits like speeding and idling for long periods of time drive up fuel expenditure. According to the NZ department of Energy, most drivers can improve their fuel economy by approximately 10% by adjusting their driving tactics and staying on top of vehicle maintenance. Teach your team driving habits that save money, such as gently accelerating and avoiding “putting the pedal to the metal.”

5. Lose the weight

Make sure you don’t have any unnecessary cargo in your vehicles. Extra hand trucks, heavy containers, or surplus equipment should be removed from vehicles. Just 45kg of extra weight can reduce your fuel economy by 1%, depending on the size of the vehicle. Excess weight is a concern for recreational vehicles, too. Cut down on fuel costs by removing a rarely used roof rack or minimizing the number of non-essential items in your trunk.

(Sources: Pinnacle Research, Optimo Route, NZ Business, RACQ)

Maintain fleet vehicles used on the road. Upgrade to diesel vehicles where possible.