How to Know When It's Time to Grow Your Fleet

It seems that everyone has an opinion on whether buying or leasing an industrial truck is a better financing approach, but it’s not always as easy to know how many trucks to have in your fleet and what factors should be included in making this decision. According to an Ernst & Young report on Total Cost of Ownership, many fleet owners do not have all the data necessary to make an informed decision on the cost of each industrial truck versus the return on investment, especially when the fleet numbers fewer than 25 trucks. Even for larger fleets, the report concluded that cost efficiency can be a difficult metric to evaluate.

Your accountant will be an invaluable resource when it comes to determining when the time is right to add more industrial trucks to your fleet and what sort of financing option is best for your cash flow. Working with your accountant to track the real cost of leasing or buying your industrial truck fleet will help you assess how to optimize the performance of your fleet and whether or not it’s time to get more trucks on the road. When looking at the hard numbers, be sure to keep potential hidden fleet costs in mind, such as:

●Financing

●Depreciation

●Fleet age

●Mileage

●Internal administration costs

You may find that it is more efficient to add a couple of newer trucks to the fleet in order to hedge the depreciation and fleet age over time. Or, you may find that the trucks you have aren’t giving you the maximum return on your total dollar and can be utilized more efficiently before expanding the fleet.

In my blog post on how to determine the number of trucks needed in your fleet, I outline how important it is to be able to balance staying on top of anticipated demand while not overextending your businesses balance in order to gain optimum return on your investment. At Somerville Hino, we can help you take a look at your needs to determine how to optimize your fleet performance, not just this year, but for many years to come.