If you work in home services and you’re more than a one-person operation, you understand the importance of fleet vehicles. Whether you focus on restoration, renovation, remodeling or new construction, you’ll need trucks.
Your crews have to get from one job to the next, along with equipment and materials.
But fleet vehicles come with a whole host of challenges. And the first rough patch is a simple one. You have to buy them.
In this article, we’ll cover the basics of fleet vehicles. We’ll compare buying to leasing. And we’ll provide 3 tips for buying (or leasing) the best fleet vehicles for your business.
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To Buy or Lease?
Your very first decision is whether you want to buy or lease your fleet.
To be clear, the dilemma isn’t about ownership. It’s about choosing the option with the most economic value based on your financial situation and business goals.
Leasing costs less than buying—upfront, at least. But don’t forget to factor in the potential cumulative fees for the lease period, including anything you might owe at the end of the lease.
In many cases, leases work well for short-term or one-off projects. If you need one more truck for a couple of weeks, for example. But when thinking long-term, it may be in your best interest (and possibly even cheaper) to buy than to lease.
There’s not a one-size-fits-all answer to this question. Some home services businesses should preserve capital and opt for leases because they’re less expensive in the short term. Others should take on the larger up-front cost in exchange for financial security later.
You’ll need to explore both options to truly know which is best for you. But the good news is the three tips below will work whether you choose to buy or lease.
“Fuel makes up 71% of fleet operating costs.” – Motus
3 Tips for Purchasing Fleet Vehicles
When it comes time to buy (or lease), there are 3 things you should take into account.
Choose the Right Vehicles, Not the Cheapest
It’s easy to get lured in by low-price tags when shopping for fleet vehicles. Especially if you’re buying multiple trucks at the same time.
But bargain hunting doesn’t necessarily mean going for the cheapest option.
Before heading out to dealerships, list the types of vehicles your business needs, along with their mechanical, size and functionality specs. And be sure to stick to your guns no matter how attractive other deals may seem.
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Look beyond the price tag. Consider the value each fleet vehicle brings to your business. Absolutely refuse to compromise on the functionality you need.
Find Dealerships With a Dedicated Fleet Program
Shop around for a vehicle dealership with a flexible fleet purchase program.
Most carmakers offer discounted prices and other incentives for fleet orders. However, qualifications and requirements for fleet purchases vary among dealers and manufacturers.
For instance, some dealers require a certain number of purchase units per specific vehicle model, while others only look at the total number of vehicles bought.
Find a dealership with a fleet program that matches your purchase order. Remember, you can always buy different vehicles from multiple dealerships if no single dealer meets all your needs.
Pay Attention to the Invoice Price
The invoice price is the amount the dealer pays the carmaker for a particular vehicle. The dealer wants to make a profit and (justifiably) adds a markup to this figure.
This is what you see listed on the manufacturer’s recommended retail price (MSRP).
It’s always best to negotiate the fleet’s price based on the invoice price instead of the MSRP. That way, you’ll be haggling with the dealer over profit margins. Just don’t expect to pay the invoice price for fleet vehicles, no matter what you may have heard.
Starting your negotiation at the invoice price and plan on allowing for a fair profit margin from there. That’s the best way to get a low price.
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Here are a few more tips you may be able to put to use when buying fleet vehicles. These won’t work in every situation, but you should consider them if applicable.
- Get the dealer to waive their dealer fee, if possible. This is typically $100 to $600 per vehicle.
- Capitalize on every available incentive, bonus and discount. Just because your sales rep doesn’t offer savings doesn’t mean they’re not available. Be sure to ask.
- Consider trade-ins if you already have an old fleet. It’s possible you could curb some of the cost by taking advantage of the value of your older trucks.
- Shop around and be flexible with car brands. We all have a favorite make and model, but don’t allow that to influence your fleet buying decisions.
Bringing It All Together
There are several ways you could get a great deal on fleet purchases. Find the cost-saving techniques and workarounds that best suit your home services business needs and be patient.
Buying fleet vehicles is a process. It’s rarely quick.
If you want a good deal, do your homework and take your time.