Sharing secrets

by Bonnie Toews

Savings on fuel: Some savings on fuel consumption can be hidden to executives of transportation and distribution doing cost analyses for their companies because they don’t know about it, points out Al Boughton, President of TrailCon Leasing Inc. “We put all the fuel in the reefers for our customers. When they buy the fuel from us, they don’t have to pay tax on it because we have covered fuel, which is tax exempt – in other words, there is no road tax. How much money does that save? A lot.”

Guaranteed cost-per-mile: Jeff Kirby, President of Altruck Idealease, suggests another little known saving. “When you contract a full-service fleet, you’re signing up with a company that is going to guarantee a fixed rate or certain cost per mile for four, five or six years, depending on the contract. Your cost per mile is based on truck and maintenance combined with annual mileage. Other than buying an extended warranty with exclusions say for a refrigerator, that’s a product you cannot buy in the marketplace anywhere. Even as a consumer, you cannot lease a car with a guaranteed cost per mile for a period of five years. Your costs fluctuate on a pay-as-you-go basis.”

Parts purchasing: Boughton says leasing companies can service equipment cheaper than private fleets because they service them with their own people. “We do volume purchasing on all our parts for our trailers, and smaller private fleet managers can link into that buying power,” he says.

Customized services: One more cost benefit, says Kirby, is customized services. “Leases can be tailored to a customer’s actual usage. If you’re dormant four months of the year and your business is seasonal, leases can run for periods of eight months at a time with no payments for four months. Usually it’s billed in a fixed rate and a mileage rate. As you are busier at different times of the year, you’re going to have a higher bill at times when you are creating higher revenue. The billing matches your cash flow.”

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