3 Questions You Must Answer to Improve Asset Utilization
Michael Riemer
Common Sense SaaS & AI Leader | Serial Entrepreneur | 50+ Product Launches | 5 Patents in AI & IoT | Fractional CPO/CEO Driving Revenue Growth
When your trucks aren’t on the road, not only are they failing to make you money, they are also costing you money.
Asset utilization is a key performance indicator, and most fleet owners want to see that number as high as possible. To improve your asset utilization rate, you need to answer three basic questions.
1. What’s your real cost of low asset utilization? When looking at asset utilization, make sure you include all of the areas it impacts. There are the obvious costs of getting the vehicle towed and repowering the load. But there also are costs you may not be considering. Look at your rental expenses and categorize rentals needed to replace a downed asset separate from those required to meet increased demand.
While it’s hard to put a price on the impact a late load has on your customer service, it’s a given that customers aren’t going to be happy if you repeatedly miss delivery windows due to downed assets. Also, remember to consider the impact on drivers. Drivers want to be on the road, and since they’re constrained by Hours of Service (HOS) regulations, they’re unhappy if their trucks consistently break down.
2. Do you understand the important role maintenance plays in improving asset utilization? Trucks that are well-maintained break down less often. PM currency reduces the number and cost of breakdowns. Unscheduled repairs, like those that follow a breakdown, increase downtime and have a negative impact on asset utilization. In addition, a lack of information and visibility into service events increases the number of service events, the downtime for each event and the cost of each repair.