A company vehicle can be an expensive asset (and it can even more pricey if you own a fleet of them). To help cut costs, here are several steps that you can take.
Lease, don’t buy
Leasing can work out more affordable and practical for many businesses. While you may not own these vehicles, you don’t have to pay as much up front. Leasing also gives you access to a higher quality vehicle that you may not otherwise be able to buy, plus you can upgrade once your lease contract runs out, allowing you to always drive a vehicle that’s relatively modern and presentable. You may pay more in the long run through leasing, which can be a drawback. That said, you can terminate a lease at any point, which you cannot do when buying a vehicle on finance.
Compare business vehicle insurance rates
Business vehicle insurance rates can be high, so it’s worth shopping around. Bundling business vehicle insurance with other forms of commercial insurance can sometimes save you money. You should also consider what you really need to be covered for. Extras like windscreen cover aren’t always worth the increased rates.
Take advantage of tax deductions
Business vehicle expenses such as fuel, insurance, repairs and lease costs are tax deductible. Make sure that you’re recording all of these expenses so that you can take advantage of this. This could include keeping receipts of fuel and repairs. These tax deductions can be more complicated if you own a fleet and you may want to hire an accountant to work out these deductions for you.
Encourage efficient driving
You can save cost on fuels and repairs by the way you use your vehicle. This could include driving smoothly and taking direct routes. If you have a fleet of vehicles and multiple drivers, it could benefit you to monitor drivers using fleet tracking services and dash cams. This will ensure that drivers keep to routes and don’t waste gas. You could also give out rewards to those that drive economically.
Hire the right drivers
You should carefully consider who drives your business vehicles. By only allowing drivers with a good driving history to use your vehicles, you’ll save money on insurance. Drivers with a good history are also less likely to have accidents or commit driving felonies, potentially also saving you money in insurance claims and lawsuits. Make sure to put a screening process in place when hiring drivers that checks all of this.