Fleet Operations Moves to slash leasing costs
13 July 2016
Author: Jack Carfrae
Fleet management firm Fleet Operations has launched a digital service that allows businesses to procure vehicles through numerous different leasing companies, effectively treating multiple suppliers as one.
Known as Move, the system is designed to increase transparency and prevent leasing firms from augmenting their prices over time.
"[It] allows fleet managers to plug in their leasing companies of choice, which means they can have more than one but they have the ability to deal with what feels like a single supplier," Ross Jackson, CEO of Fleet Operations, told BusinessCar.
"Sole supply in this market is kind of a bad thing because leasing companies tend to increase their profit margins over time, which means the price of leasing vehicles goes up - but people try and use one supplier because it just makes life easier."
The firm trialled the service for 10 months prior to its launch, during which it handled around 2500 vehicles and is said to have saved approximately £2.6 million in lease and purchase costs - an average of £21 a month. "Somebody running 100 vehicles would expect to save £1000 per vehicle by adopting the system," said Jackson.
The service is also open to fleet and businesses dealerships and Jackson likened it to an insurance price comparison site, but added that fleets could set their own prices and stipulations.
"In our case the price comparison site becomes the people you want to compare with, so let's say it might be Zurich, Aviva or LV, for example. These would be people negotiating on your terms, specifically for your business to give you the buying power - but most importantly it gets you transparency."
Users pay a charge to access the service, but there is no broker's fee, as is the case with insurance comparison websites and leasing brokers.
"A price comparison site works on the basis that every time you buy something, the site gets a commission from the insurer. There's an access fee [for the Move service] which allows us to manage the system, but you control the supply chain," said Jackson.
"There are a lot of leasing broker websites out there, but they're loaded with specific terms and deals that aren't relevant to your business. Also, each time you transact with them they make quite a lot of money out of the process, but you never get the true cost. A broker website might say 'this costs £300', but the reality is it costs £270 and they're making the difference. What we're doing is saying 'no, it costs £270'."