Building a fleet starts with acquiring your fleet vehicles. The types of vehicles you choose are dependent on what products you’re delivering – and to where. If you’re a local business, like a florist or restaurant, delivering small items, you probably need a fleet of cargo vans. If you’re delivering larger items, like kitchen cabinets or appliances, a fleet of box trucks might make more sense. If you’re shipping large pallets nationwide, you need a fleet of semi-trucks.
Whether you’re assembling your fleet from scratch or replacing older vehicles as they wear out, you need to find the right fleet dealership to help you with your needs. Where can you get the best deals, find the right selection, and receive top-notch service? You’ll need to do some shopping around – and follow the advice given here.
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Do You Qualify for Fleet Sales?
It would help if you had enough vehicles in your fleet to qualify for fleet sales. The exact qualifications differ from manufacturer to manufacturer and dealer to dealer, but in general, you qualify if you have a minimum of 15 vehicles registered in your company’s name. You may also qualify if you’ve purchased five or more new vehicles during the past twelve months. Fleet dealers don’t want to bother with selling single vehicles; they like to deal in bulk.
Once you’ve qualified for fleet sales, your company is assigned a fleet number. This number can be used to purchase vehicles at any dealership for that brand.
Choosing the Right Vehicles for Your Fleet
It’s essential that you build your fleet with the right types of vehicles for your business. It would be best if you considered the types of items you’ll be delivering, how much cargo space and weight capacity you need, and whether the vehicle needs special shelving or other options to handle your delivery items.
You also need to consider the cost of the vehicle – but go behind the initial purchase price. You’ll want to estimate the total cost of ownership over the lifetime of the vehicle, including maintenance and fuel costs. That may lead you to consider a hybrid, electric, or alternative fuel models. You may want to spend a little more upfront to lower your costs over the long-term.
Once you’ve determined the types of vehicles you need, you can start identifying specific brands and models. Make your comparisons online, at the manufacturers’ websites, and narrow it down to a handful of similar options from different brands.
You must go to a fleet dealer having preselected the vehicles and options you want. When you’re working with a fleet dealership, you’re not shopping; you’re negotiating. You should, however, arrange for test drives for the vehicles you’re considering, using some of your company’s drivers. They’ll give you good feedback as to the suitability of a given vehicle for the job.
Finding the Right Fleet Dealer
Fleet sales are essential to auto manufacturers. According to Edmunds, fleet sales represented almost 20% of all new vehicle sales in 2019. For that reason, most manufacturers emphasize fleet sales and fleet dealerships.
Where do you find fleet dealerships? The first place to look is on the manufacturer’s website. Look for a “programs” page or section and then for a link for fleets. The manufacturer may service different kinds of fleets – General Motors, for example, has programs for small fleets, government fleets, law enforcement fleets, and the like – so select the one that best describes your business. This should take you to a fleet page with lots of useful information, including a contact form and a fleet dealership list.
You can contact a fleet dealer directly or contact a manufacturer’s fleet representative for your region. That representative can provide more information on the manufacturer’s fleet programs and suggest appropriate dealers.
Another place to get started is the Automotive Fleet Directory. This online directory lists more than 150 fleet dealers nationwide, and you can search it by dealer type and location.
Know that not all dealers with fleet departments are equally knowledgeable about fleet sales and service, and not all are familiar with your business’s particular needs. Once you identify a dealer that sells the kind of fleet vehicles you need, get to know a representative from that firm. You want to make sure they understand your needs and can provide the after-sale service necessary. If you can’t establish a good working relationship, that’s not the dealer for you.
Fleets 101: Getting the Best Deal
Fleet salespeople are trained to deal with the needs of businesses like yours that purchase multiple vehicles per year. They’re paid on a different commission structure, so they’re not necessarily pushing hard to close the immediate deal but working to establish a good working relationship for the long term.
Fleet vehicles are typically sold at or near the dealer’s wholesale price. The vehicles you want probably aren’t on the dealer’s lot, so they’ll have to be ordered, either from the factory or other dealers. (Keep that in mind in your planning – it may take several months to get the vehicles you want.)
When you’re negotiating the final price, take the following into account:
- Many manufacturers offer special fleet pricing and service programs
- You can often get the dealer to wave regional advertising fees (typically 1.5%-2% of invoice cost)
- You can sometimes get the dealer to waive the dealer fee (typically $100-$600 per vehicle)
- Standard manufacturer rebates and sales incentives can often be applied
When negotiating with a dealership, make sure you focus on the invoice price, not the sticker price. Make sure you get all applicable rebates and sales incentives. And finalize your fleet purchase price before you start talking about any trade-ins.
Fleets 101: Buying vs. Leasing – Which is Best for You?
The final decision you need to make is whether you want to purchase or lease your fleet vehicles. There are pros and cons to both options.
The benefits of purchasing a vehicle include:
- No mileage or usage restrictions
- No penalties for getting rid of a vehicle
- Tax benefits for depreciation
- You own the equity in your vehicles
The benefits of leasing your fleet include:
- Easier to replace vehicles more often
- Preserves your capital
- Lower monthly payments than purchasing
- Treated as an expense on your balance sheet, not a capital investment
It’s always good to consult your accountant as to the best approach for your business.
Fleets 101: Choosing Your Fleet Vehicle Dealership is Only the First Step
As a delivery business, your fleet is your most valuable asset, and that means you need to take the time to study everything there is to know about choosing the right fleet vehicle dealership to proper maintenance and even route management to ensure you aren’t putting unnecessary wear and tear on your fleet.