Fleets missing a trick on cost savings
So says Fleet Support Group (FSG) which has released new analysis showing that introducing a comprehensive road risk management strategy for those who drive for work is one of the most effective money-saving measures for private and public sector organisations.
The Government-backed "Driving for Better Business" campaign, which is managed by RoadSafe and is supported by FSG, has calculated that savings of at least 30% from reductions in road crash rates can accrue if companies implement a range of best practice recommendations.
This is backed up by FSG's new data, which highlights the value of goods that must be sold to cover the cost of road accidents.
The data compare the examples of two clients. Client A over a three-year period to 31 December 2009 successfully cut the number of road crashes in which its vehicles were involved by a commendable 28%. However, FSG says that, assuming a net profit margin of 5% and that the "true" cost of crashes – lost orders and output, salaries, administration costs, legal fees and general business interruption – was three times the claims cost, it still means that in 2009 the company's vehicles were involved in 156 crashes at a cost per claim of £1,116.
FSG chairman Geoffrey Bray added: 'That meant that the company had to sell goods to the value of £3.5 million simply to cover the cost of the crashes. Such a large figure is alarming and should act as a wake-up call to all businesses.'
Similarly a second company cut its crash rate by 31% over the three-year period under review, but in 2009 still saw its vehicles involved in 25 road crashes. As a result, FSG has calculated that the business would have to sell goods to the value of almost £600,000 to cover the cost of the incidents.
Mr Bray concluded: 'There are huge savings to be had. If all companies focused on how the cost of road crashes was impacting on their sales performance and ultimately their bottom line I'm sure that more businesses would implement at-work driving safety initiatives.'