What is Fleet Management? Fleet Management is the process of financing and managing a fleet of equipment. When managed incorrectly, a material handling fleet can cost companies thousands of dollars in lost productivity and reduced profit. An effective Fleet Management strategy is more than cost control and data management, it is an integrated effort to improve operations, lower forklift operating costs and increase profitability.
There are three main factors that influence the cost of
maintaining your forklifts.
1. Age of Equipment
2. Hours of Use
3. Operating Environment
The combination of these factors determines how long a
forklift can operate in an environment before the cost of maintenance exceeds
the cost of replacement. Additional expenses known as “soft costs” such as the production
and operator losses due to equipment downtime, processing costs for the rising
number of invoices and the use of supplemental rental equipment increase to
total cost of ownership for material handling equipment.
We use simple graphing to illustrate when a lift truck becomes too expensive to repair. Using cost per hour values on one axis and accumulated operating hours on the other axis we graph a line using accumulated costs (ownership costs plus maintenance costs). The “break even” point is where the line is at its lowest point on the total cost curve. If a truck has already surpassed that “break even” point, it is costing more than it’s worth. It is recognized by the material handling industry that the average lift truck has an estimated economic life of 10,000 to 15,000 hours.
As your equipment approaches the upper range of its economic
life your fleet will begin to experience and increased number of failures and
the individual cost of these repairs will increase as the wear on the
forklift’s major systems such as the power train, hydraulic and structural
components reaches that break point.