Controlling fleet expenses by buying fuel?

     An economic downturn and unstable fuel costs are just two of the reasons people are tightening their wallets. Law enforcement administrators are experiencing much the same thing as the agencies they serve struggle to meet increasing demands with decreasing resources. Knowing when and where every dollar is spent is vital to strategic operational planning, yet controlling variable costs can be tricky, even in the best of times.

     The largest variable cost for law enforcement is typically the fuel that powers their vehicles. Unpredictable fuel prices have further compounded already stretched budgets. But one sheriff's office has found a better way to manage its fuel expenses simply by changing the way fuel is purchased.

Fleet cards gain popularity

     Quickly becoming a thing of the past is a law enforcement official purchasing fuel with cash, corporate credit cards or a consumer fuel card. The demise of these rudimentary payment methods is the time-consuming and painstaking administration of manually tracking fuel transactions, reconciling items purchased, managing multiple payments, and then hoping that gas expenses come in under budget.

     Today, many agencies are switching to a fleet purchasing card program for fleet-related fuel and vehicle maintenance purchases. Generally these purchasing cards have multi-brand acceptance, and can restrict purchasing to fuel only or fuel and fleet maintenance only. Leveraging some of the industry's leading technology, these card systems have been shown to increase driver efficiency, tighten expense accountability and improve cost savings. In addition, the programs generally come with reporting and exception alerts that significantly reduce unauthorized purchases and cut administrative workload.

A success story in Louisiana

     The Caddo Parish Sheriff's Office, located in the northwest corner of Louisiana, protects one of the largest communities in the state, including the city of Shreveport. The agency's 600 deputies and 320 fleet vehicles provide both rural and urban residents with patrol and investigative services, as well as operate a correctional center.

     For years, the sheriff's office owned and operated four fueling locations throughout Caddo Parish. Yet driving to one of these sites frequently took officers out of their patrol routes. And, fueling vehicles outside parish boundaries still required credit cards, which made reconciliation of paper receipts, tracking gas consumption and reviewing driver purchases an operational inevitability.

     In 2000, department administrators learned of Fuelman, a fleet fuel management solution, when the Caddo Parish School Board started using the solution for its vehicles. Upon discovering how these "fleet gas cards" did much more for the school board than a mainstream credit card program, sheriff's department administrators decided to test the program as well.

Benefits of fuel cards

     Caddo Parish Sheriff's Office officials knew having the ability to fuel at more than just its four locations would be beneficial, but they didn't anticipate all the supplemental benefits they would receive from having a fleet purchasing card. Officers now had access to fuel at hundreds of gas stations within Louisiana, which kept them closer to their designated routes. "The convenience of having retail pay-at-the-pump acceptance at multiple locations is ideal," says Mike Gregory, fleet manager for the Caddo Parish Sherriff's Office, "Deputies can fuel wherever they are — never leaving their vehicles unattended — then get back on the road quickly."

     Similarly, Sonyia Wilson, who manages fleet maintenance for 500 service vehicles in Gastonia, North Carolina, including Gaston County Police Department vehicles, agrees having a fleet fueling card that is accepted at multiple locations in and out of the state has helped her as well. "When our officers are in training or conducting other activities that take them outside our jurisdiction, they can fuel when and where they need it," she explains. "The transaction detail is still recorded on the same invoice and we can track the mileage, location, driver, etc., no matter where they are."

Strategic data collection and cost reductions

     Many industry fleet cards offer online reporting systems so fleet managers can track and review fuel transactions. Because Fuelman-accepting stations are required to supply Level-3 transaction data — the most comprehensive available — Caddo Parish administrators see detail necessary to track vehicle and driver purchasing patterns. Also, by collecting this data in real time, Fuelman's purchase controls can stop a transaction in progress if pre-set parameters are reached or an unauthorized purchase is attempted.

     Caddo Parish officials use transaction information to track where, when and how much fuel is purchased for each vehicle. Because an odometer reading is required for each fuel purchase, administrators also know how many miles each vehicle is driven between fill-ups and how many miles each vehicle can drive on a gallon of fuel. The data is also used for planning decisions. "With this level of detail about fuel consumption we can evaluate which vehicles and model years get the best gas mileage and that helps us plan future vehicle purchases," Gregory adds.

     Caddo Parish administrators no longer must track fuel receipts from various credit card purchases or complete expense reports. The agency pays just one invoice instead of processing hundreds of individual transactions, and can easily account for expenses down to the vehicle, driver, department, etc.

Maintenance monitoring

     The Caddo Parish Sheriff's Office also found the fleet card's preventative maintenance program to be essential in its planning. Because the odometer reading is now regularly recorded, sheriff's office fleet managers can flag vehicles needing a tune-up and schedule back-up vehicles. The system ensures Caddo Parish vehicles are always operating at top performance levels.

     In addition to supplying data to determine when maintenance is needed, some fleet cards can also purchase vehicle maintenance. It is not uncommon to have agency-approved vehicle maintenance suppliers that offer a preferred rate. When reviewing fleet card purchasing programs, be sure to examine the list of authorized maintenance providers. Most fleet card programs are willing to invite new members to join their network. With an agency's providers in the network, officers always have access to assistance when needed and receive preferred pricing.

Selecting a fleet card program

     While there are several benefits to adopting a fleet card system, choosing a card with the purchasing features, controls and reporting that best fits a department's specific needs will determine the program's success.

     There are many card programs available. To simplify a search, consider visiting individual fleet card carrier Web sites and comparing features, or use a "feature match" program from sites such as www.fleetcardsusa.com, which educates the user in the benefits then recommends the best card based on geographic location and driving behavior.

     To evaluate a fleet card service provider, keep the following tips top-of-mind:

  1. Look at the complete card features such as customizable purchasing controls reporting formats, real-time activity fraud alerts, etc.
  2. Research the card provider and its programs to ensure they have the data capture capabilities needed to identify key purchasing and activity trends.
  3. Review the card's administrative monthly fees or transaction fees carefully. These fees can be as much as $2 per month, per card.
  4. Make sure the card system records transaction data in real time. This is the only way the card can stop a purchase in mid transaction at the pump and minimize unauthorized purchases.
  5. Pick a program that is right for the fleet's location and driving behavior and provides the highest level of purchasing controls to maximize cost-saving benefits.

     A comprehensive fleet purchasing card program will save users a significant amount of time and money and the benefits are often realized immediately. As the Caddo Parish Sheriff's Office discovered it is also a valuable tool for measuring and evaluating fuel and maintenance purchase patterns and provides a proactive approach to accounting for every dollar.

     Emily Ward is a freelance writer based in Toronto, Ontario.

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