Every Sales Professional has, or will have to, manage expenses, and for those doing a fair few miles the fuel card can be one of the most favourable time saving solutions. However, what do we really know about this ‘benefit’ how is it taxed, what are the costs involved, and with governments legislating differently from budget to budget, how will we be effected?
The Financial Burden
Jakes de Kock
, Marketing Director at The Fuelcard Company
, one of the UK’s leading providers of fuel cards and fuel management solutions, comments on recent Government fuel announcements and offers advice and tips to help sales fleet drivers save money on fuel
As fuel prices continue to spiral, the financial burden on businesses with a sales fleet is growing more critical by the day. The cost of a litre of diesel currently stands at around 139 pence per litre with petrol reaching an all-time high of 133 pence per litre.
The latest fuel price increases have hit small and medium sized companies particularly hard with many forced out of business. With no apparent sign of relief and a further 1p fuel tax hike on the horizon for April, drivers are scratching their heads for a solution. It’s clear something needs to be done and fast!
However, the Government was right to deny Labour’s calls to reverse the fuel VAT increase
– that is a short-term fix which would see us, the public, pay for the additional deficit caused by this missing, and pre-budgeted, revenue through some other means.
These reversals in pre-planned VAT or duty rises are nothing more than temporary measures with no durable substance. The Government must commit to a long-term strategy to benefit both us in the transport sector as well as the general public – it must not renege on its promises again and must implement a fair fuel policy as a matter of urgency.
Avoiding Fuel Fraud
For businesses running one or more vehicles, using fuel cards
can lead to significant savings on fuel. As well as offering business drivers access to exclusive discounts of up to 5p per litre on the national average diesel price, they also help managers monitor and control their fuel spend.
The real benefit comes from the increased control managers have over fuel usage, which can lead to substantial long term savings. Businesses are able to monitor the fuel usage of individual drivers as well as the entire sales fleet, providing managers with a wealth of information. Not only can this help to identify areas where savings can be made, such as routing, or training drivers to adopt a more fuel efficient driving style, but it can also highlight fraudulent fuel claims.
New research has revealed that around 25 percent of all fuel claims could be exaggerated, costing fleet businesses millions of pounds every year at a time when budgets are already stretched
can significantly reduce fraudulent fuel claims by taking the responsibility for claiming fuel expenses out of drivers’ hands completely. Rather than relying on the honesty of their employees, sales fleet managers can see exactly when, where and how much fuel was purchased on a monthly invoice, making it virtually impossible for their drivers to fabricate journeys or exaggerate their fuel claim.
Using a fuel card will also prevent employees from buying any unauthorised extras such as magazines, or food as only fuel can be bought using a fuel card
. Fraud costs the UK economy £136 million every year, which amounts to serious losses for businesses struggling to manage tight budgets.
Common ways of committing mileage fraud include exaggerating the length of journey times, claiming for a journey which they made but was funded by a colleague, making unnecessary journeys and fabricating journeys completely.
Drivers can significantly reduce their fuel consumption and therefore save money by adopting eco-driving techniques. Nearly 50 percent of the energy needed to power a car goes into acceleration so maintaining a steady speed will increase fuel efficiency.
Driving a little slower can also make a huge difference to the amount of fuel used. For example, a motorist driving at 80 mph will burn up to 25 per cent more fuel than at the speed limit of 70 mph while cutting back to 60 mph reduces consumption by another nine per cent.
Encountering high volumes of traffic and congestion can put the driver under pressure, resulting in defensive driving techniques which can actually increase fuel consumption by as much as 40 percent. Constantly braking too hard, speeding up to overtake at every opportunity and driving at a fast pace means you’re using up more fuel than is necessary.
Keeping your vehicle well maintained can also help to increase fuel efficiency. Ensuring tyres are properly inflated, regular services and removing unnecessary weight such as roof racks can reduce the amount of energy needed to power the vehicle and therefore make fuel last longer.