Article

Outsourcing Fuel Management

February 2011, TruckingInfo.com - Feature

by Commentary Glen Sokolis, Sokolis Group

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&newsIt certainly seems that "outsourcing" is the buzzword these days across most industries. Fleet fuel management is no exception.


If you are the president, finance or operations manager, or even fuel manager at a fleet company, you should know that now is the time to outsource your fuel management. I'm not talking about outsourcing to a company located out of this country in India or China. There are companies with fuel management experts located right here in the good ol' U-S of A. They have extensive experience with diesel fuel prices, fuel cards, mobile fueling and overall fuel management in almost every aspect of the business.

As you know, fuel is a significant cost to almost every operation that has vehicles, no matter if you are in food products, retail/wholesale, sanitation or construction. For some fleet companies it's a necessary evil to get their product to market. Through the human capital supply chain in most companies, a CFO or COO has the ultimate responsibility for fleet management but that gets layered down to directors, fleet managers or someone named Beth who has been signing off on fueling invoices for years. She looks at the diesel fuel price, looks at the taxes, checks to see if it adds up and if it does, all is good with the company's fuel management system!

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Is it? Is it really? What is she comparing the diesel fuel prices to? How does she know what the correct taxes are? Do YOU have the answers? Or even the time to find out?

How about getting help with cost cutting measures? Wouldn't it be great to capture fuel savings of 5-15 cents per gallon or more? You bet. Outsourcing your fuel management makes it possible.

Fleet fuel experts are seasoned industry pros with best practices, proven fuel management systems and hundreds of key contacts in the fuel industry. A good fuel expert company should have a proven track record of helping clients with forecasting, procurement, logistics and financial reconciliation that brings their fuel management to a whole new level. Look for companies that have developed and maintained long-term relationships with their clients. Be sure to check out client testimonials and ask for references.

When you outsource your fleet fuel management to an expert, you will save your company money in the long run and afford you and your employees the benefit of time to focus on other business objectives. They will become instrumental to your fuel management program and strategy. Having an effective outsourced fuel management arrangement offers you the benefit of having a team of fueling experts working for you. They should have the ability to negotiate long-term fueling supply contracts, fuel card and fleet card fees, match your company's special needs and conditions and bundle that to provide fuel savings beyond what almost any company can achieve on its own. Another key benefit would be their aggregate purchasing power of large volumes of fuel each year to make sure even the smallest of clients can get a good fuel buying deal.

Additionally, fuel management systems can audit invoices, verify price quotes, resolve billing issues and provide transparency from fleet managers to CFO. Is that something you can get out of a box or with a person lacking experience, knowledge or time? No way. Depending on your fleet management operation your diesel fuel costs are somewhere between number 1 to 7 on your expense side. Is the money being spent on diesel fuel prices without having your full arms around it?

I know you're curious about outsourcing and what it must cost to have a centralized staff of fuel industry professionals working for you. What if I told you that most fleet companies actually realize fuel savings that are three to eight times the monthly amount they pay for outsourced services? Outsourcing is definitely worth it.


Glen Sokolis is president of Sokolis Group, a nationwide fuel management and fuel consulting company, www.FuelManagementSokolisGroup.com. You can reach him at gsokolis@sokolisgroup.com or (267) 482-6160.


Recent installments of "Friday Fuel:"

* "Five W's for Fleet Fuel Buying," 2/18/2011

* "Rising Fuel Prices Mean You Need A Fleet Fueling Policy", 1/28/2011

* "Are Fuel Prices Going To Break Your Budget?" 1/7/2011

* "Happy New Year, Diesel Fuel Prices!" 12/30/2010.

* "Why Diesel Fuel Prices Need Increased Taxes," 12/3/2010

* "Diesel Fuel Prices Going Up, Fuel Management Needed If You Want Fuel Savings">, 11/19/2010

* "Bad Fleet Fuel Auditing," 11/5/2010


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