2019 Fleet Management Benchmark Survey

Gain insights and best practices from industry leaders on how to create more value from your fleet.

See the Survey Results

Fleet Management Strategies of Top Performers

► INDUSTRY STUDY: KEY TRENDS & PRACTICES

The role of the fleet continues to evolve as market conditions and technology change at exponential rates. To stay competitive in today’s dynamic market, fleet professionals are being challenged to demonstrate how the fleet creates value for the organization. Some companies have made great strides by leveraging their fleet to change competitive positioning, grow revenue and positively impact the bottom line. However, others still struggle to make a difference for the organization. Is there a blueprint for more effective fleet management?

To answer that question we launched a benchmark study in 2018 to learn what top performers were doing differently to maximize the fleet’s strategic value.

Who We Surveyed

A group of 106 shippers and logistics service providers (LSPs) participated in our second annual fleet management survey. Here’s a snapshot of the respondent demographics:

A diverse range of industries were represented:

• More than half of the respondents work in manufacturing (30%) and distribution (23%).
• No single industry dominated the survey.

A large majority of respondents’ companies operate in North America:

• While the survey included companies with a global footprint, the U.S. and Canada were cited as the top two locations for operations.

The size and type of fleets represented skewed larger and more private than last year:

• Private (65%)
• Combination (21%)
• <25 vehicles (30%)
• 500-1000 vehicles (8%)
• Over 25% of respondents manage fleets greater than 500 vehicles compared to 15% in 2018.
• More than 64% operate only private fleets -- a 16% increase in this category versus last year.

Respondent Perspectives

To determine how top performers think and act differently, we asked respondents to rate their companies from two aspects: overall financial performance and management’s strategic view of the fleet. Results were consolidated to identify two groups in each category that could be used for more detailed analysis.

First, we asked respondents to rate how well financially their company is doing today?

Then, we asked them how strategically is their fleet viewed by senior management?

The impact of each group’s perspective on transportation management strategies, tactics, technology, and business performance was further analyzed and the findings were compared to answer two hypothetical questions:

• Is financial performance a factor or a result?

Examining Financial Performance & Fleet Strategy

As in last year’s survey, 2019 results indicate a compelling correlation between how well a company performs financially and the strategic importance management places on the fleet.

Financial Performance by Strategic Importance

Strategic Importance by Financial Performance

Key Trends & Practices

We asked respondents to select two macroeconomic, regulatory or industry changes that will have the greatest impact on fleet operations over the next 5 years?

Shaping Future Fleet Strategies, Tactics and Trends

It’s not surprising that respondents once again cited the driver shortage as having the greatest impact on fleet operations in the near future. It was ranked the #1 factor by over 64% of respondents, almost doubling the response of the closest alternative.

Operational Challenges Faced by Respondents:

• Reducing Costs retained the #1 spot with 78% of survey respondents citing it as the largest challenge they are currently facing. This is an 11% increase over the 2018 survey, which may reflect greater concerns with capacity and fuel costs.

The Findings

Ranked by Selection Percentage:

• Driver Shortages
• Fuel Costs
• ELD/HOS
• eCommerce/Home Delivery
• Driverless Vehicles
• Crowd-Sourced Delivery

What Fleet Strategies or Tactics Are the Competition Using That Are the Greatest Concern to You?

Competitive Outlook

Overall, respondents once again cited Low Cost/Free Shipping (47%) and Faster Deliveries (41%) as the top two most concerning competitive strategies. These strategies align with the ongoing concerns expressed by respondents regarding the impact of changing customer expectations.

How Fleet Value Is Measured

Companies that place higher strategic value on the fleet do a much better job capturing the high-value measurement metrics of contribution to revenue growth and competitive differentiation.

82% of all respondents said their companies measure the value of the fleet based on cost effectiveness, making it the #1 response once again. Measuring value based on Customer Service decreased significantly from 2018, dropping from 75% to 40%.

Conclusion

The outlook for 2019 is very similar to 2018. Last year’s market-driving factors such as driver capacity and more demanding customers are still relevant.

There continues to be a strong correlation between management’s perception of the strategic importance of the fleet and performance. Placing higher strategic value on the fleet results in faster growth and better financial performance.

Driver shortage continues to be cited as the greatest threat over the next five years, with top-performing/high-growth companies feeling the greatest impact.

Investing in technology and changing fleet operations strategy are still the top areas of focus for improvement, which is intuitive as they go hand-in-hand and enable one another to give the company a competitive advantage.

About Descartes

Descartes is the global leader in providing cloud-based solutions focused on improving the productivity, performance and security of logistics-intensive businesses.