This document discusses ways to improve fleet operations and reduce costs through the use of technology. It describes how fleet management systems can help optimize routing, improve fuel efficiency through reduced idling and controlling speed, automate paperwork, and provide driver safety coaching. These systems aim to increase productivity and revenue while lowering fuel costs and vehicle maintenance expenses. Data collected can also help protect fleets in the event of accidents or customer disputes. The document advocates starting slowly with measurable goals and metrics to track progress over time.

1. Measuring your Return on Investment

2. 2 How much does it cost to operate your fleet?

3. 3 Total CPM = $2.27/mile Cost of Sales = 7.4% Maintenance = $0.28/mile Tires = $0.036/mile Self-Insurance = $1800/year Spare Vehicle Ratio = 15% Vehicles per Mechanic = 13 Non-Productive Driver Time per Day = 2.2 hours Based on a survey of 272 private fleets by IFMC, Inc. Includes all time spent other than dispatch, loading, and unloading. Benchmark Private Fleet Costs - Determine your cost per mile to establish your own benchmarks.

4. 4 Where have my drivers gone?How can I keep my drivers?According to ATRI’s 2006 study: Average age of an IBT (Teamster) driver – 57 Average age of a TL driver – 46 Drivers today do not have the industry background they did 10 years ago $3500 to recruit and train a new driver 76% of respondents reported improved driver morale with onboard computers 18% of respondents report increased productivity 19% reported improved driver retention

5. 5 So, what are we going to do? And in the process, we will: Improve Safety Improve Regulatory Compliance Reduce Fuel Consumption Reduce Maintenance Costs Increase Productive Time Increase Customer Satisfaction Provide Legal Protection Make the drivers’ job easier No more paper logs No more trip reports Protection against false customer service claims Protection against litigation

6. 6 Compliant, paperless logging makes Hours of Service compliance easier. Automates DOT Logging Log on at the beginning of your shift Log off at the end of your shift Hourly totals are all calculated for you. No more calculation errors

7. 7 You enter fuel gallons purchased Miles by jurisdiction, odometer readings, time of entry and departure are all automatic You don’t have to complete DTR’s, just enter fuel purchases into the keypad Claim state/provincial refunds for non-highway fuel consumed Fuel Tax and IRP Reporting

8. 8 Drive safer and more efficiently Coaches and provides feedback. Know how all drivers compare to each other, and to company averages. Monitor speed, shifting patterns, panic braking, idle time Plan and track and the miles and hours worked. Efficiency = SafetyDriving habits that improve MPG improve safety.

9. 9 Fuel Economy is Improved by Controlling Driving Habits: “ The driver is arguably the principal variable in fuel mileage. There is as much as a 35 percent difference between the most proficient and the least capable drivers” - The Fleet Manager’s Guide to Fuel Economy Technology and Maintenance Council of the American Trucking Association Idling Controlling your Speed Progressive Shifting Rapid Accelerations/Decelerations

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11. 11 Argonne National Laboratory study - September 21, 2004 Average truck wastes 1830 gallons per year in fuel just idling 6 hours per day on average Estimated 10M tons CO2, 50K tons of NOX, 2K tons particulates emitted annually by idling Engine Maintenance Costs 6 hours of idling = 42 miles of engine wear 6 hours idling contributes $4.41/day to engine overhaul costs What does idling cost?

12. 12 Idling Costs 1000 RPM, 10 HP Draw 6 hours/day 1830 hours/year 2196 gallons/year $2.78/gallon (US DOE national average price, 2/01/2010) $6104.88 per year fuel consumed while idling, per vehicle/ What happens if you bring idle down to 10% or 300 Hours annually?

13. 13 Controlling Speed = Improving MPG + Improving Safety For every 1 MPH increase over 55 MPH, fuel consumption increases 2.2%. 7.5 MPG at 55 MPH drops to 6.6 MPG at 65 MPH $3537.36 in excess fuel (70,000 miles, $2.78 per gallon) 10 MPH average speed decrease equals 18% reduction in NOX emissions American Trucking Associations Bridgestone Firestone ongoing tests Transportation Research Center, Inc (Society of Automotive Engineers J1263 recommended practice)

14. 14 Controlling Speed;Does slowing down your fleet impact customer service? What is the productivity cost of slowing your fleet down? 10 MPH increase does not equal 10 MPH increase in average speed. 55 MPH speed limit=50.1 MPH average speed 65 MPH speed limit=57.1 MPH average speed American Trucking Associations study - 1998

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16. 16 Speed vs. Vehicle Wear and Fuel Consumption Rapid acceleration consumes excess energy Rapid deceleration wastes energy Increase from 55 MPH to 65 MPH results in: Tire wear increases from 5% to 16% (depending on GVW) 10% to 15% decrease in miles to engine overhaul 15% increase in oil consumption 15% in brake lining life Lower Fuel Costs = Lower Vehicle Maintenance Costs

17. 17 Plan your work, best utilizing people and equipment. Measure every hour worked by every driver. Measure every mile driven by every vehicle. Helps automate delivery information. Helps you plan routes more efficiently. Document delivery/location Information Improving customer service = more revenue

18. 18 Provides a silent witness on your side in an accident. Monitor Safety Programs. Present the company as a professional organization that works to be a good corporate citizen. Safety is Everyone’s Responsibility

19. 19 Safe Driving? Happy Customers? A Marketing Edge? A Positive Image? Professional Drivers? Measurable Goals? A Satisfied Boss? What would happen to your operations if you could have a supervisor go on every route every time? What is it worth?Some items are not easily measureable yet still provide positive return on investment.

20. 20 Objective vs. Subjective Professionalism Efficiency $avings MBO ROI Micro-Management Big Brother Top-Down Tattle Tale Gotcha!

21. 21 How do we start? Slow – one area of improvement at a time Consistent – never let your message waiver Persistent – never let up Measure your progress in key metrics annually Ask for help

22. Joel Beal joelbeal@loadtrek.net 817.480.0926 (cell) 817.945.6850 (office) www.loadtrek.net