Anyone who operates a delivery or transportation business knows that fuel management is always a top priority. Fuel costs are always on the rise, and they make up a major part of delivery costs. If you manage fuel well, it can mean an efficient and profitable delivery operation. If you get it wrong, however, it can have a massive impact on the profitability of your business.

Focusing on the right system is essential. There are various fuel monitoring systems available, with different approaches that logistics businesses can follow.

We’re going to focus on the importance of routing software for fuel management, and why effective management is so important for your business. Read on to find out more.

What is fuel management?

In the most simple terms, fuel management is the process of controlling and monitoring how much fuel is consumed. This can be applied to any mode of transport, although we’ll be focused on road transport in particular.

In the delivery business, one of the biggest expenses is fuel. This is an expense that’s always present, and you just can’t do deliveries without using fuel. Fuel management needs to be a careful process to make sure that the amount of fuel consumed is appropriate in relation to the deliveries done.

Proper fuel management helps you make sure that the right amount of resources is used, and that fuel resources are used efficiently. Good management of fuel is important for reducing fuel costs and maximizing the efficiency of deliveries.

Why is fuel management important?

Because fuel is one of the biggest expenses in any delivery network, overseeing fuel usage is essential for keeping costs under control. Without a proper fuel management system in place, delivery companies may face enormous fuel costs, which could have a big impact on profit margins.

Fuel management is related to various different areas in a delivery. Of course, it comes down to the distance traveled during deliveries, but there are also other factors that influence the fuel costs. These include things like the efficiency of the vehicle, how the driver is performing, and how well-planned the delivery routes are.

Proper fuel regulation and administration don’t just help to save on fuel costs. These practices can also improve the way the delivery business operates, and streamline other areas (such as the ones mentioned above). Fuel management is important for strong record-keeping and reporting on deliveries as well.

How does fuel management save money?

If you’re just purchasing fuel whenever you need it without actually monitoring fuel consumption, then there’s a good chance you’re spending too much money. Carefully monitoring and managing fuel can reveal many different areas to save money.

For example, logistics and fleet managers could look at fuel consumption, and find areas on the delivery routes where unnecessary distances were covered. The delivery routes can then be optimized, reducing fuel costs.

There is also the question of how and where fuel is purchased. Different options, such as buying bulk fuel at wholesale prices, or using fuel cards, could result in significant financial savings. By carefully monitoring and managing fuel consumption, logistics managers will be able to identify these areas.

Fuel management also ties into fleet management and vehicle maintenance. By monitoring fuel consumption closely, it’s easier to spot any irregularities or changes in fuel consumption. This can help to alert fleet managers of any possible vehicle and maintenance issues.

Fuel is a major expense, so carefully managing it is essential. Even if seemingly small areas of fuel savings are identified, this could result in major savings over the long term. Keeping track of fuel consumption is important for any delivery or transportation business to maintain profitability.

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Benefits of fuel management

Managing fuel consumption is an essential process with various advantages. Let’s explore some of the main benefits of the practice below.

Leads to better route management and planning

When it comes to managing fuel, understanding routing and using the right routing software is essential. We’ll cover this in more detail below. One of the major advantages of effective fuel management, related to this, is improved route planning.

When you’re carefully monitoring your fuel consumption, you end up paying much more attention to the delivery routes. The way that routes are planned is one of the biggest factors in the overall fuel efficiency of any delivery operation. By looking at where fuel is being overconsumed, logistics managers can make smarter decisions around route planning in advance. Beyond just saving money on fuel, this can also result in more efficient deliveries and a more organized business.

Gives you a bigger picture of your fleet

Proper management of fuel is one of the best ways to gather a complete understanding of your fleet and its activities. By tracking fuel costs, you can see where your drivers are going, what they’re doing, how vehicles are performing, and how efficient delivery routes are.

Fuel management forms an important part of fleet and delivery management. Once you start monitoring this, you’re able to gain better insights into the fleet to be able to make smarter decisions. This can include things like understanding what vehicles are best to use, what routes are most efficient, whether drivers are performing up to standard, and whether fuel is being purchased correctly.

Helps understand cost tracking per mile

Cost tracking per mile is one of the most typical aspects of a fuel management system, and it can add plenty of value to your business. Cost tracking per mile is determined by looking at the total distance that vehicles travel compared to the amount of fuel used.

This is necessary for understanding the mileage of the fleet and the fuel performance levels related to this. Understanding cost tracking per mile statistics is important for drivers to know. This can help improve the way they drive.

Keeps track of fuel theft

Fuel theft is actually a fairly common occurrence, and it is something that fleet managers need to consider and pay careful attention to. Fuel theft could come in various different forms. This could include tampering with the odometer, declaring an incorrect fuel consumption, or providing improper maintenance to vehicles.

Proper fuel management helps keep a careful eye on fuel consumption to avoid the possibility of theft. You can see exactly when fuel is filled up and quickly notice any strange activity. This also helps set a standard system in place for drivers to follow and understand.

Monitors driver behavior

Fuel consumption can be easily affected by the behavior of the drivers. This can include things like speeding, how they shift gears, unnecessary idling, and so on. Carefully monitoring fuel consumption gives fleet managers a better understanding of how different drivers are behaving, and how to optimize this.

This can help spread awareness to drivers around their behavior, which can lead to significant long-term fuel savings.

In most cases, drivers simply don’t realize just how much fuel costs their employer. This can cause them to drive with bad fuel habits. Providing this information to drivers is a great way of helping them pay more attention to the way they drive and actively save on fuel consumption.

Improves fleet maintenance

Having a solid fuel management system in place can help a great deal with fleet maintenance. Fuel consumption is closely linked to the state of the vehicle. Paying close attention to managing fuel consumption will help fleet managers to pay more attention to the fuel efficiency of their vehicles, and make sure that all vehicles are properly maintained and serviced.

Something as simple as driving a vehicle with incorrect tire pressure can make a big difference to the overall fuel consumption. Improving the maintenance of the fleet will help cut fuel costs, but it also helps with keeping the vehicles in good running condition. This will reduce costs on vehicle maintenance over the long run.

How routing software helps with fuel management

One of the most effective ways of managing fuel consumption is by using quality route optimization software. All delivery and logistics managers should make use of this software for its many benefits. Not only will it make delivery operations faster and easier to manage, but it will also result in significant fuel savings.

This is because the right routing software works to optimize each delivery route and stop. The software will take all delivery locations into consideration, and calculate the most efficient route possible to get to each location.

Good routing software will also consider the size, weight, and type of each delivery being made. The software will then make sure that the right vehicles are assigned to the right packages. This optimizes the routes, but it also ensures that each vehicle is carrying the right load based on its size and restrictions. Doing this avoids overloading vehicles, or having them carry the wrong cargo. This means the vehicle will run better, resulting in fuel savings.

Of course, routing software also automatically updates the routes, making sure that vehicles are always on the most efficient path. If there is a sudden road closure or holdup, the software will be able to quickly reroute the vehicle, making sure that the most optimal route is taken. This helps decrease the mileage that the vehicle travels, resulting in fuel savings.

Not to mention the added bonus of making delivery management so much easier. Route optimization software saves loads of time and effort, allowing logistics managers to apply their focus where it’s really needed.

How else can you improve fuel management?

Beyond using the right routing software, great management of fuel can also be achieved through a couple of other processes.

Fleet maintenance

Staying on top of vehicle maintenance is an essential factor in keeping vehicles as fuel-efficient as possible. Things like oil changes or tire rotations will help in maintaining a longer vehicle life, but it also helps keep them running as fuel-efficient as possible.

Using fleet check software like Track-POD allows you to easily keep track of vehicles and log any issues. Drivers can inspect their vehicles daily, and fleet managers can stay up to date with vehicles at all times. If any maintenance issues are flagged, then the vehicle can be repaired straight away, keeping things in good running order.

This means greater fuel savings and vehicles that last longer.

Weight management

Drivers that carry unnecessary weight as part of their cargo will see a rise in fuel expenses. Any surplus cargo or equipment should be removed from trucks to optimize their fuel performance. Even small items that don’t need to be there can make a big difference to the overall fuel economy of a vehicle.

This is something that drivers should always pay attention to. As mentioned earlier, having the right routing software can also help with this, making sure that trucks are not assigned cargo that is too heavy for them.

Driving behavior monitoring

Drivers also need to be trained properly when it comes to fuel efficiency. A large part of fuel management comes down to the way drivers behave. Fuel efficient driving practices are often overlooked, and drivers don’t always realize the value of careful fuel management.

By simply adjusting driving habits, drivers can make a huge difference to the fuel economy of their vehicles.

Fuel sourcing

It’s also important to consider what fuel you’re using and where you’re buying it from. Sourcing fuel from the right gas stations can make a big difference to the overall fuel cost of any delivery network.

Final thoughts

Having the right fuel management system in place is essential for maintaining the right profit margins for any delivery business. Fuel management helps reduce unnecessary expenses, and it provides valuable data for managing your fleet and delivery operations.

Using routing software is a must for any logistics manager looking to improve the way they work. Not only does this completely enhance the overall delivery route, but it’s also the easiest way to manage fuel.