Report for Jonathan Moody
In this report, I shall answer all of your concerns by providing solutions for the different scenarios
that may occur. I shall conclude this report with general recommendations for you business, taking
into consideration the state of the World’s Economy.
The Expenses Associated with the Running of Vehicles
There are four categories under which your expenses for operating vehicles will fall under.
Category Number Category Name Expenses
1 Fuel Petrol, Diesel, Oil
2 Repairs and Maintenance Tyres, Repairs, Cleaning
3 Administration Licensing, Registrations
4 Financial Insurance, Interest on Loan, Depreciation
In deciding whether the current fleet of vehicles is sufficient, you need to consider the following:
Is your income meeting and covering your vehicle expenses?
Are you are making a profit?
Are all of your vehicles being used to their maximum potential? (By maximum potential I
mean that if a working day is 8 hours and it takes a van or truck to make a delivery in an
hour, then that vehicle makes 8 deliveries in a day. Also, each time a truck leaves the
wholesaler, the truck should be filled close to maximum capacity)
Scenario 1 – Your vehicles are not being used efficiently.
Solution 1 – Consider the following possibilities:
The use of smaller vans for diminishing load sizes
Timing routes in such a way as to have trucks or vans constantly filled close to capacity
Cutting your losses or replacing a vehicle that has become dilapidated and costs more to
run than the income gained from that vehicle
Leasing/Renting unused vehicles to other businesses in order to obtain more revenue
Selling off if it is unnecessary to have this amount of vehicles
By implementing any of these possibilities, you will cut down the vehicle costs of the
business, operate more efficiently and make more profit.
Scenario 2 – Your income is not covering your expenses, you are not making a profit and your
vehicles are being used efficiently.
Solution 2 – Perhaps business is too slow to operate a fleet of this size and that certain decisions
should be made in order to reduce expenses. Consider the following possibilities:
Selling off vehicles that attract a good resale value
Buying smaller vans that cost less to operate and are utilised more efficiently
Selling all your vehicles and leasing them instead
Nevarr Pillay Page 1
In this report, I shall answer all of your concerns by providing solutions for the different scenarios
that may occur. I shall conclude this report with general recommendations for you business, taking
into consideration the state of the World’s Economy.
The Expenses Associated with the Running of Vehicles
There are four categories under which your expenses for operating vehicles will fall under.
Category Number Category Name Expenses
1 Fuel Petrol, Diesel, Oil
2 Repairs and Maintenance Tyres, Repairs, Cleaning
3 Administration Licensing, Registrations
4 Financial Insurance, Interest on Loan, Depreciation
In deciding whether the current fleet of vehicles is sufficient, you need to consider the following:
Is your income meeting and covering your vehicle expenses?
Are you are making a profit?
Are all of your vehicles being used to their maximum potential? (By maximum potential I
mean that if a working day is 8 hours and it takes a van or truck to make a delivery in an
hour, then that vehicle makes 8 deliveries in a day. Also, each time a truck leaves the
wholesaler, the truck should be filled close to maximum capacity)
Scenario 1 – Your vehicles are not being used efficiently.
Solution 1 – Consider the following possibilities:
The use of smaller vans for diminishing load sizes
Timing routes in such a way as to have trucks or vans constantly filled close to capacity
Cutting your losses or replacing a vehicle that has become dilapidated and costs more to
run than the income gained from that vehicle
Leasing/Renting unused vehicles to other businesses in order to obtain more revenue
Selling off if it is unnecessary to have this amount of vehicles
By implementing any of these possibilities, you will cut down the vehicle costs of the
business, operate more efficiently and make more profit.
Scenario 2 – Your income is not covering your expenses, you are not making a profit and your
vehicles are being used efficiently.
Solution 2 – Perhaps business is too slow to operate a fleet of this size and that certain decisions
should be made in order to reduce expenses. Consider the following possibilities:
Selling off vehicles that attract a good resale value
Buying smaller vans that cost less to operate and are utilised more efficiently
Selling all your vehicles and leasing them instead
Nevarr Pillay Page 1
