Fleet Management Software: A Buyer's Guide
Find out how GPS fleet tracking works and how to find the right fleet management software for your business with our Buyer's...
Read moreWith government regulations shifting, frequent occurrences of natural phenomena1 and increased supply without increased demand, the fuel economy has been in a state of flux. According to a recent outlook report from Deloitte, while 2017 was a year of growth for the oil and gas industry, 2018 is set to be a period of change. Gas prices are already on the rise across the country in the first few weeks of 2018,2 and it's unknown how high they'll reach.
For carriers and small shipping companies, any increase in fuel prices can drastically influence overhead operations costs and impact profitability. Let's take a look at why rising fuel costs are important to independent shipping organizations and discuss actionable steps that businesses can take to thrive despite rising costs.
Overall, crude oil prices are poised to increase to around $60 per pound in 2018.3 This in turn will make average gasoline prices rise to around $2.57 per gallon in 20184, up from $2.42 per gallon in 2017,5, with diesel prices also on the rise. These numbers may seem like a few pennies and dollars now, but will quickly compound into a huge blow to overhead costs. As it stands, carriers, shippers and distributors rely heavily on both gasoline and diesel to get shipments from point A to point B.
Additionally, while the rising costs of both gasoline and diesel are important for all carriers to consider, they’re even more critical for hazmat distributors in the oil and gas industry. Time is money when it comes to moving fuel, and these carriers especially must proactively address fuel efficiency and work to shorten travel times. This includes tapping into more efficient routes, instant location information and improved response times.
One of the easiest ways for all carriers and small trucking companies to start streamlining fuel efficiency in 2018 is through the use of technology. Near real time software can help companies better understand where trucks are going, the routes they are taking, and where opportunities for improvement lie.
For example, DiPinto Brothers in Edison, New Jersey specializes in delivery of containers to and from the ports in the New York area. It operates more than thirty vehicles that travel throughout the Northeastern seaboard, and its fleet racks up 133,000 miles per week.
"You have to route accurately so good planning is vital," said John Puya, Fleet/Safety Director at DiPinto Brothers. "It's all about taking the most direct route so you don't waste driver time or fuel."
To continue to combat the effects of rising fuel costs in 2018, businesses can leverage near real-time GPS tracking to monitor fuel efficiency–allowing them to better understand how much gasoline or diesel is consumed by their fleet each year. In addition, they can pinpoint where there is waste in their operations and create action plans to become more efficient long-term.
Some of the lesser-known areas that impact fuel efficiency include:
With the right technology and ample planning and preparation, all facets of your business, from back-end operations to drivers, can streamline efficiency and stretch the boundaries of fuel costs in 2018.
1 http://fortune.com/2017/08/31/hurricane-harvey-gas-prices-national
2 https://business.gasbuddy.com/gas-prices-continue-to-move-higher-as-2018-begins
3 https://www.eia.gov/outlooks/steo
4 https://business.gasbuddy.com/wp-content/uploads/2018/01/2018fueloutlookvUSF.pdf
5 http://bjournal.com/2017-saw-gas-price-swings-2018-starting-off-in-the-middle
6 https://www.fueleconomy.gov/feg/driveHabits.jsp
7 https://www.fueleconomy.gov/feg/maintain.jsp
Tags: Cost control, Dispatching & Scheduling, Field management, Productivity & Efficiency, Revenue & ROI, Routing, Team Management, Vehicle Maintenance
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