Management of fuel expenses is a significant part of the fleet business because it is a major contributor to cost and profitability. Fleet managers always look for a comprehensive solution to monitor and control fuel expenses. A fuel card is a reliable tool to optimize fuel-related costs. It provides convenient transaction facilities during fuel purchases and also keeps track of frequency and prices. It prevents unauthorized and unnecessary expenses as you can set limits for spending. The system is getting acknowledged by many customers as it allows considerable savings on fuel prices and helps to improve profitability in vehicle operations.
What Is A Fuel Card?
Fuel cards are just like debit or credit cards used for purchasing fuel-related merchandise. It is the best alternative to cash transactions during fuel purchases. The users can also avail of discounts at selected locations by using these cards as per the terms between issuing enterprise and the pumping stations. The fuel cards keep track of expenses on fuel, which forms the basis of many strategic decisions towards profitability.
Some companies also offer additional purchase facilities of car accessories through the cards. The fuel cards are available in two options based on the price structure. One type of card offers a fixed price bracket for fuel purchases regardless of price fluctuations. This price remains fixed for a week-long period after which you can renew it. Another type of card is a general card that uses the pump price of fuel at the time of filling. The fixed price card gives a cost-benefit when fuel price increases rapidly.
Benefits Offered By Fuel Card
The fuel cards offer several benefits to fleet management companies and commercial vehicle operators. The benefits are as follows:
Convenient to Use
A fuel card is very convenient to use instead of cash transactions. This ensures security as there is no need to handle cash. These cards also help avoid hard copy receipts as you can keep track of the purchase details online. The fuel cards can support a wide range of network connectivity that offers more flexibility in use.
Cost Savings
An advantage of using fuel cards is availing discounts depending on the card-issuing company and pumping station location. It results in considerable cost savings as fuel prices are increasing rapidly. Fuel cards take care of fluctuating prices and help save costs in the long run.
Fuel Efficiency
These cards allow setting up transaction limits, so there is no chance of overconsumption and unauthorized fuel purchase. You can fix the limit for individual vehicles and track their performance on fuel efficiency. It also improves the accountability of drivers to optimize fuel consumption and helps control costs.
Additional Services
These cards allow the purchase of various fuel-related products and services. It includes the cost of spare parts, repairs, and maintenance costs. The cards also offer loyalty points accrued for every transaction with redemption facilities. The cards also guide you to locate nearing pumping stations and other facilities while driving on a route.
How to Choose the Suitable Fuel Card?
Fuel cards offer many tangible benefits in managing operations and optimizing costs in fleet operations. It is necessary to consider several factors while looking for the best solution that suits your requirements. Let us discuss the factors that influence the choice of suitable fuel card for the fleet.
Location Advantages
It is a critical point to consider because some payment cards are suitable to operate only in a small region. If the truck movements are limited to a small area, the ideal and cost-effective solution will be the card fitted for that territory. Most of the trucks usually travel long distances across the country. In such cases, one should select cards having better coverage areas and acceptability across different pumping stations. These cards also guide you in finding the best service facilities and other important points on your route.
Quality of Fuel
Fuel cards generally provide mixed-type fuels, but you can select cards that would provide you with branded petrol or gasoline as per your choice. For local movements, a non-branded fuel card can be a better option. You can select the card considering all the factors like the type of vehicle, fuel brand, and pricing advantages.
Availability of Discounts
Fleet managers often look for cards that offer better discounts because saving on fuel expenses can affect profitability to a great extent. The discount amount and clauses vary between companies, so you should consider the discount offers while selecting a card. Few companies offer price discounts at the time of purchase, while some provide a rebate on the total monthly purchase.
Special Features
The fuel card has some advanced features that help get updated information on vehicle performance, routes, and fuel consumption when the fuel card is active. Managers can analyze these data to make appropriate decisions to improve cost-efficiency, asset utilization, and productivity.
Conclusion
Fuel cards are a highly efficient and reliable tool that makes fleet management operations more streamlined and cost-effective. The fuel cards make any business operation more organized and profitable. Most fuel cards are acceptable in a large network of fuel stations. It is a very effective tool to control the overall cost of business by saving on petrol and diesel expenses. It is necessary to choose an ideal card so that you can optimize the cost of fuel consumption and reduce the chances of unauthorized or inefficient use.