Fleeting Costs: Transitioning Your Idle Fleet to a FAVR Program
So, you have all of these idle vehicles weighing on your bottom line. What are your options and how to you evaluate them? It is important for businesses to evaluate how their idle fleet vehicles are currently being managed, and the impact to the company’s bottom line of each line-item associated with vehicle ownership. For instance, while depreciation is slowed in times of low usage, companies continue to pay costs associated with titles, insurance and registration. What is often overlooked with idle fleet vehicles are additional expenses and liabilities that come with methods of storage during times of inactivity.
Fixed and variable rate (FAVR) mileage reimbursement programs – which reimburse mobile workers for the business use of their personal assets – have proven to reduce excess spend, fairly and accurately reimburse employees and provide vehicle program flexibility overall. As such, companies with fleet programs are now considering making the switch to a FAVR program.
