With the government recently confirming the 23rd June 2016 as voting day in the EU referendum there is already much debate about the potential impact on the UK economy. Recent reports suggest that George Osbourne may be about to announce further public spending cuts to help ensure that he achieves his budget surplus objectives. His hand may be forced because a number of economic factors appear to be conspiring against him. His concerns about the wider global economy and the potential impact on the UK are also echoed by well-respected figures, like ex Bank of England Governor Mervyn King, who issued a recent warning that he believes another banking sector led financial crisis is looming large.
Whilst there is no value in wild speculation, it is undeniable that UK businesses have a lot of cost and operational importance tied up in their fleet and corporate travel arrangements. Given this importance and regardless of the current and/or forecast economic climate, there is real value in making sure that businesses are insuring themselves against all of the relevant economic risk factors. Some might argue that this is not particularly clever, it’s just a good common sense approach to cost control management.
Understanding a business’s capability to withstand an economic downturn, and any subsequent impact on jobs, profits and customer service can be tested depending on the answers to the 10 key questions listed below:
- How will the current/forecast global economic slowdown impact on my business?
- Shares in the European banking sector are down a staggering 25% since the turn of the year. If there is another financial crisis, what might this mean for the automotive leasing sector and how do I ensure my business has ready access to competitive lease rentals?
- Is my fleet purchasing strategy robust enough to withstand a financial downturn, what are my options if I am currently in a long-term sole supply arrangement? Do I have a viable contingency plan?
- The used car market is seeing increased availability of quality stock, resale values are likely to stall as a result so how will this impact on my fleet costs moving forward?
- How do I identify, control and reduce my total cost of fleet ownership? As an example, how much will the Government’s U-turn on diesel supplement cost my business over the next 5 years?
- Recent cost savings are very welcome, but what is the short to medium outlook for oil prices and how do I budget for this vital element of fleet cost moving forward?
- With an increasing number of company car scheme options available, how might UK businesses be affected by George Osbourne’s attempts to protect historically lucrative Treasury incomes? How might this impact on my business?
- In-life cost benchmarking on individual vehicles tends to be difficult, but l want to ensure that my costs are consistently competitive, how can I achieve this regardless of economic conditions?
- The UK fleet leasing sector is a very mature market and there appears to be little to differentiate suppliers, is there any value in reviewing suppliers and what is the most effective way to do this?
- How do I ensure that my fleet maximises the potential of new technologies whilst meeting our environmental objectives?
There are no set answers to these 10 questions, responses will vary from business to business, but if not optimised each of the topics covered could have a significant impact on fleet costs.
There are a number of simple, effective and proven methodologies that can help address the very complex questions posed. Putting these in place is not as difficult as can first appear and there are an increasing number of UK businesses who are optimising their fleet options.
To find out how they are achieving this, please contact Tony Greenidge, Sales & Marketing Director