Fleet Out-Sourcery
Optimizing the Outsourced Share of Rental Activity
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The Idea
• If rental demand is variable, and• If you have access to an outsource supplier
• How do you optimize rental fleet size?• Can it affect rates?
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Based on projecting 5,439 Chargeable days
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• -Project 4 factors for the next year• #Chargeable days• Monthly distribution of days• Utilization of fleet/Turns• Costs-annual-monthly• Outsourcing• Cost/each additional fleet vehicle• Administrative Costs
Key Ingredients to Optimize Sedans
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95% Projection for next year
Actual Next Year % Projected/Actual
FY 2010 6,539 5,304 123%FY 2011 4,938 5,894 84%FY 2012 5,439 5,717 95%FY 2013 5,416 5,669 96%FY 2014 5,302 5,838 91%
Cumulative 27,634 28,422 97%
Projecting Chargeable Days- A Pinch of Caution
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Projecting FY 2012 Distribution of Days for MS Sedans
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Tot
Projected Monthly Distribution of Chargeable Days 394 442 494 771 554 266 258 348 459 558 443 452 5,439
% Annual Total / Five year average
0.073 0.081 0.091 0.142 0.102 0.049 0.047 0.064 0.084 0.103 0.081 0.083 1.00
High Low
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Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun Tot
Proj. Monthly Distribution of
Chargeable Days
395 393 503 732 524 252 236 336 459 578 448 446 5,302
Fleet Utilization (Chargeable
Days/Month/Vehicle)
22 22 28 41 29 14 13 19 26 32 25 25
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Fleet Utilization (Chargeable
Days/Month/Vehicle)
18 18 23 33 24 11 11 15 21 26 20 20
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The Role of Vehicle Utilization in Determining Fleet Size
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Essential Cost Information
Monthly Annual
Fleet Vehicle Cost
Monthly Depreciation 191.00 Interest 24.96
Insurance 37.00 Subtotal 252.96 3,035.52
Outourced Daily charges 41.00
Annual Adminstrative Costs 6,657.42 79,889.00
JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN0
100200300400500600700800900
Budgeted Outsourced DaysBudgeted Chargeable Days
Months
Budgeted Chargeable
Days
JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN0
100200300400500600700800900
Actual Outsourced Days
Actual Chargeable DaysMonths
Actual Chargeable
Days
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FY 12 Budgeted
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun TotTotal Chargeable Days 394 442 494 771 554 266 258 348 459 558 443 452 5,439
Utilization23.3
Ave. Fleet Size19.0
Days Provided by Fleet 394 442 443 443 443 266 258 348 443 443 443 443 4,808
Outsourced Days - - 51 328 112 - - - 16 115 - 9 631
5,439
FY 12 Actual
Days Provided by Fleet 349 418 454 444 382 275 203 332 418 524 443 366 4,608 Outsourced Days 76 42 174 318 181 7 8 10 64 116 36 77 1,109
Total Days 425 460 628 762 563 282 211 342 482 640 479 443 5,717
Utilization 20.5 24.6 25.2 24.7 21.2 15.3 11.3 18.4 17.4 29.1 24.6 20.3 21.0Fleet Size 17 17 18 18 18 18 18 18 24 18 18 18 18.3
Planned Utilization, Days and Fleet Size Versus actual
By under-projecting activity levels fleet resources were not wasted. Surge was met by outsourcing
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Review and SummaryFleet
Utilization (Days/Mo.)
Fleet Size (#Vehicles)
Fleet Chargeable
Days
Outsourced Chargeable
Days
Total Chargeable
Days
Annual Cost Less
Maintenance & Fuel
Daily Rate
$41/Veh/Day Projected
0% Outsourcing 23.3 34 5,439 - 5,439 180,364$ 33.16$
100% Outsourcing 23.3 - - 5,439 5,439 302,878$ 55.69$
Optimal 23.3 21 4,808 631 5,439 161,277$ 29.65$
Actual FY 2012 Approved
21.0 18.3 4,608 1,109 5,717 31.00
Revenues 177,227$
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FY 2012 Planned Days versus Actual
Budgeted
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun TotDays Provided by Fleet 394 442 443 443 443 266 258 348 443 443 443 443 4,808
Outsourced Days - - 51 328 112 - - - 16 115 - 9 631 Total Days 394 442 494 771 554 266 258 348 459 558 443 452 5,439
Actual
Days Provided by Fleet 349 418 454 444 382 275 203 332 418 524 443 366 4,608 Outsourced Days 76 42 174 318 181 7 8 10 64 116 36 77 1,109
Total Days 425 460 628 762 563 282 211 342 482 640 479 443 5,717
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