How telematics is shaping the world in which we live - Pt 2

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Part 2 – How should SME’s utilise all that data?
Telematics

With more than 150,000 telematics devices fitted to vehicles, ABAX are the 3rd largest supplier within the European Telematics industry. That surmounts to a lot of data, a lot of customers and a lot of money being saved.

What does the typical customer look like? ABAX UK work with fleet sizes of 100 + vehicles, 1 vehicle and everything in between. You will find our devices on company cars, grey fleet, HGV’s, vans, tractors and various bespoke applications. However, the vast majority of our customers work within a trade and look after a fleet of 5 to 15 vans. There are also a disproportionately high number of Arsenal fans called Simon, aged 45-50.

That isn’t strictly true. When I say ‘look after a fleet of 5 to 15 vans’, what I actually mean is they employee 5 to 15 tradesmen. Their employees then have use of a company van – a tool to the trade if you will.

Simon, the Arsenal fan, was and still is in many ways one of the tradesmen. One of the lads! But he has earned his stripes through many years of hard work on the tools. Now he runs his business and tries to manage his time between the office and the various job sites. Simon is definitely not a qualified or experienced fleet manager though.

What ABAX look to provide is a telematics system that contains enough data for Simon to assert more control over his business, reduce any unnecessary risks and increase the business’s efficiencies. Some of these benefits will be directly related to the vehicles, others can be directly attributed to the business – something which Simon knows inside out.

The telematics industry in the UK is all too readily linked to the word ‘tracking’. This has a very negative connotation to all concerned. It implies that something is going on and there is cause not to trust the workforce. ‘Driver Behaviour’ is another term thrown around with telemetric systems and again, it isn’t a positive phrase. It suggests that the drivers misbehave, spend all day in the cab with the engine running to keep warm, hit the pedals with lead-lined boots to set of harsh driving alarms and the rest...

Some companies will find this depth of information useful. The larger hauliers that run 24/7 operations up and down the country will see significant savings by training their drivers to lift and coast like Lewis Hamilton. 2 miles per gallon extra soon adds up across 1000 vehicles working in a continuous freight transportation company.

That same increase in efficiency does not bare the same financial significance to a workforce of 10 electricians. What we need to do is take the data from telematics and allow the business owner to gain control, reduce risk and increase efficiencies.

Control

Prevention is better than cure and good decisions are made on the back of good insight. Something as simple as knowing the current mileage reading of each vehicle within your fleet has the potential to save a lot of money. Telematics will provide this data – so use it!

Servicing vehicles at specified intervals will help reduce the spend on costly, unforeseen break downs. But it is difficult to know when each vehicle is due a service, let alone to plan it in advance! With visual and prompted reminders in advance, vehicle servicing and down time can be planned out in a timely manner. Arranging a spare van in advance is definitely a better option than having to  rearrange or cancel jobs further down the line.

Many vehicles are now leased too. With excess mileage charges ranging from anything from £0.10 per mile upwards, being able to spot high mileage trends within a fleet and swapping vehicles in advance to pool mileages is an easy way to avoid hefty bills when a vehicle is handed back at the end of a term.

A list of trips is also a handy tool within any trade. Knowing when workers got too and from sites helps many companies with time sheets, invoices and analysis as to where their workload currently sits. Documented evidence of these trips also allows businesses to settle payment or insurance claims made against them.

Risks

Typically, a tradesman will be given a van as a tool in order to do their job. That van will normally be taken home with the driver to save on travelling time. Unlike their counterparts in company cars though, drivers in commercial vehicles are almost never assigned the vehicle as a taxable benefit. Because of this, the van should never be used for private use by the driver.

ABAX finds that many business owners within the trade are simply not aware that this is the case. The van is an ‘unwritten’ perk to the job. With a team that works hard in the week, what is the harm in the guys nipping out to do their shopping or visit friends over the weekend? ‘As long as they don’t take the mick...’

As nice as that is to hear from Simon, or any other business owner, sadly HMRC do not take that view. Private usage results in a taxable benefit being assigned to the employee. So not only does the worker pay more tax for using the van privately, the business must pay national insurance on this too. Worse still, if HMRC discover that the vans are being used privately, or the company cannot prove that they are not, £3000 fines can be handed out for the business not submitted correct accounting records for each employee P11D. Business record checks can lead to audits. Audits can then lead to the requirement for businesses and their employees to replay unpaid taxes and potential fines to the same amount – with the potential to back date this over the last 6 years.

ABAX naturally educate business owners to this risk – that piece of advice is free. It is also possible for business owners then control this risk without telematics. That is a long winded process of mileage sheets and reconciliations though. Telematics will do all of that hard work for you.

Efficiencies

As previously alluded to, efficiencies can be increased in many ways with telematics. Data relating to time sheets, job cards, site visits, travel time and much more is all available to check, cross reference or peruse at the click of a button.

Knowing the location of a vehicle or employee can prove to be largely beneficial in the trades too. Call out and reactive work can be managed much more effectively by dispatching the most suitable engineer to complete the work. Add in features such as a mobile app that allows the workers to declare whether they are currently available or busy further adds to the business’s ability to get the right person to the job quickly. As we all know, good customer service will generally lead to great reviews. In the age of the internet, a good referral breads new business better than anything else.

/Chris Miller
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