If you’re upgrading your fleet to electric or hybrid vehicles, there are various costs you need to consider. One of these is vehicle tracking equipment and software.
As a fleet manager, it’s your duty to keep your vehicles and their drivers on the road safely, mitigate risk of theft, reduce operating costs where possible and ensure that your drivers have the tools they need to do their jobs efficiently.
Vehicle tracking systems offer all of this…and more.
We now live in a world where customers expect real-time delivery updates, free returns and an overall seamless experience from placing an order to having it delivered. They want to know the time their parcel will arrive down to a window of an hour or two. They want the convenience of online order without the inconvenience of not knowing when their goods will arrive.
COVID-19 has only exacerbated expectations here. With a huge influx of businesses into the delivery space in early 2020, both consumers and businesses now have a much wider competitive field to choose from – and it’s easier than ever to find a competitor if you offer a poor experience.
If you’re keen to compete with the best of them (and arguably you should, given that trends towards e-commerce have accelerated by around 10 years), you’ll need to use vehicle tracking software to provide the accuracy your customers are looking for…or risk them going elsewhere.
Here’s everything you need to know about vehicle tracking systems before making a purchase.
What is Vehicle Tracking Software?
Put simply, vehicle tracking systems allow you to track where the vehicles in your fleet are, what direction they’re travelling in and how fast they’re going.
Typically vehicle tracking systems consist of a physical tracking device and accompanying software that stores, processes and analyses the data the tracker collects. You’ll need one tracking device per vehicle in your fleet, but can run these via the same software. These monitor the movements of your vehicle via GPS or cellular data, or in some cases VHF radio signal so you get an accurate idea of its location, route and speed.
Understanding the routes your vehicles take, or receiving real-time updates on location allow you to carry out a number of related activities with a greater degree of accuracy, including:
- Route optimisation
- ‘Just in time’ warehouse picking
- Asset maintenance
- Inventory management
- Delivery updates
Essentially, if you know exactly where your vehicles are at all times, you can optimise your supply chain and distribution activities around this data.
For example, if a van is out making deliveries and you notice that its most efficient route passes your warehouse directly, you can make sure you have the inventory available for a restock. Or, you could optimise delivery routes in advance so that you can give customers an accurate delivery window.
Can Vehicle Tracking Software Be Integrated Into Existing Systems?
Whilst you can use vehicle tracking systems as a standalone protection against theft, the real benefits come when you integrate vehicle tracking into your other logistics systems, for example supply chain management software or fleet management software.
Some broader fleet management software providers, for example Masternaut and Blume offer their own vehicle tracking software that sits in a broader suite of fleet management solutions. Others, like MoreFleet specialise in vehicle tracking only.
If you have fleet management software already, it’s worth checking with your provider to see if they offer vehicle tracking. Their in-house system will be easier to integrate with your existing software, and you may get a better price. That said, don’t be afraid to look elsewhere if it doesn’t meet your needs.
What Are The Advantages of Vehicle Tracking Software and Equipment?
Knowing where each of your fleet vehicles is at all times offers numerous benefits. The only real down-side here is the cost. If you have a large fleet, this can add up (more below).
However, the advantages you gain by making this investment are numerous. You’ll operate more efficiently, offer better service to your customers and mitigate the risk of vehicle theft – and that’s just the tip of the iceberg.
Customers will happily pay a 16% price premium on products and services if they feel they have been offered a good experience, plus increased loyalty. When you add in the efficiency gains vehicle tracking software offers, the impact on your bottom line has the potential to be transformative.
The advantages of vehicle tracking systems for fleets can be divided into four main categories:
1. Vehicle Tracking System Efficiency Benefits
Fleet efficiency is all about doing more in the same timeframe whilst spending less money.
Vehicle tracking, particularly when paired with a route optimisation solution increases the productivity of your assets whilst decreasing the amount you spend on fuel because of:
- More efficient route planning for more deliveries in the same timeframe
- Optimised drop off/pick up schedules
- Reduction in delays caused by traffic or poor route choices
2. Vehicle Tracking System Security Benefits
Vehicle theft is every fleet manager’s worst nightmare. Not only is it distressing for the driver – it’s expensive, slows down operations and has a knock-on effect on your insurance premiums. Use vehicle tracking to reduce the costs and slowdowns caused by theft, and more:
- Protection against theft, if you opt for a solution with extra security features (see below)
- Increased chance of vehicle recovery in the event of theft, with reduction in insurance premiums
- Quick emergency response in the event of breakdowns or emergencies
- At-a-glance check-in on driver and vehicle security
3. Vehicle Tracking System Operational and Asset Management Benefits
As a fleet manager, it’s your job to keep your assets up and running, and ensure that you have enough employees timetabled to drive them. Vehicle tracking systems can make this significantly easier to manage:
- Predictive maintenance helps you map miles driven against potential issues to look for, so you can fix minor asset issues before they become a major problem
- Vehicle tracking creates an accurate picture of where your vehicles will be when, so you can plan driver changeover more effectively
- As a result, you decrease the downtime of your assets and increase productivity
4. Vehicle Tracking System Customer Experience (CX) Benefits
Fleet management is essential for delivering your customers a memorable experience that will keep them coming back time and again. This is just as true for B2B and 3PL companies as it is for consumer-facing fleets.
- Vehicle tracking helps you offer accurate delivery time windows to customers
- Vehicle tracking is an essential part of real-time parcel tracking and updates
- Efficient service results in higher customer lifetime value, increased loyalty and more sales
Types of Vehicle Tracking Software & Equipment
Before you buy vehicle tracking software for your fleet, it’s important to understand the different types of vehicle tracking system available. The vehicle tracking software on the market today can be divided into two main camps: ‘passive’ GPS loggers and ‘active vehicle trackers’.
Here’s what these are and what you should consider.
GPS loggers are also known as ‘passive’ tracking devices. These track your vehicles’ speed, position and direction via GPS and store this data in their internal memory. They then upload this to the system when the journey has been completed. They can’t submit this data in real-time, making them great for performance analytics but ineffective for live tracking.
Older GPS loggers needed to be removed from the vehicle and plugged in to upload data, but more recent models are WiFi-enabled and can be programmed to upload automatically via a trigger event (such as a door opening).
Active Vehicle Trackers
Active vehicle trackers track vehicle position, speed and direction via GPS, GLONASS or cellular data, in exactly the same way that passive trackers do. The key difference is that rather than storing this data and uploading it at a later date, active trackers upload it to cloud servers in real time. This allows you to track vehicles as they’re driving rather than trace their route back when they’ve completed their trip.
Satellite signal or cellular data can be unreliable in places – look for hybrid active/passive models that store data in internal memory whilst the network is unavailable for upload at a later point.
What About Anti-Theft Devices?
You can also buy tracking devices specifically designed to protect against theft, with a range of added security features besides asset tracking. These tend to be either GPS or VHF-enabled.
These systems can be activated automatically if the vehicle has been tampered with (for example, started without a key), recognise authorised drivers via a driver recognition transponder car and remotely kill the engine at safe speeds.
How Much Does Vehicle Tracking Software and Equipment Cost?
There are several factors that will affect how much vehicle tracking will cost:
- Your fleet (size, type and number of vehicles)
- Your choice of tracker (active or passive)
- The tracker installation type (wired or plug-in)
The more vehicles you have and the more complex the installation, the more you’re likely to pay. If you opt for an active tracker, you’ll likely pay a per-month leasing fee rather than an upfront cost, which is standard for cloud solutions. Whilst this works well for cash flow, you may end up paying more over time.
To get an accurate estimate for a final budget, it’s worth getting in touch with some GPS tracking vendors to see what they would offer, based on your requirements.
If you’re not quite at that stage, you can use our guide below to help you gauge likely cost per vehicle.
Fleet size: 1-20 vehicles
Entry-level and will have route mapping and fuel tracking features; cost is likely to be approx £50 to buy and £8pcm to lease.
Fleet size: 21-50 vehicles
Medium-level and will have, in addition to previous features, live route tracking, live vehicle diagnostics, reporting tools; cost is likely to be approx £200 to buy and £15pcm to lease.
Fleet size: 50+ vehicles
Advanced-level and will have, in addition to previous features, driver management, advanced live tracking, advanced reporting tools; cost is likely to be approx £300 to buy and £20pcm to lease.