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What Is Fleet Management and How It Works: A Closer Look

what is fleet management

While there are many reasons that a company might lose money, inefficiency is one of the biggest. Studies show that a company will lose 20-30% of its annual revenue to inefficiencies across the workplace.

There are many things that you can do to minimize these losses in a management position, including employee training and improving time management strategies. For freight carriers and other companies that are in the industry of operating or managing fleets, there are many variables that go into managing a fleet.

But what is fleet management, and what makes the industry of operating fleets so dynamic? Read on to gain a closer look into the world of freight carriers and fleet management.

What Is Fleet Management?

Fleet management is a term that describes the overall actions that help a group of vehicles – your fleet – make deliveries efficiently. It encompasses all the processes that dispatchers and fleet managers use to plan, execute, and monitor the activities of the fleet. These professionals make decisions about dispatching, routing, load planning, and much more.

Needless to say, managing a fleet isn’t cheap. Expenses can add up quickly, so most dispatchers are looking for ways to streamline daily work activities and ultimately save time and money for their respective companies.

Ultimately, fleet management is a process that freight carriers use to improve operational efficiency for their fleets. The dispatchers that work for freight carriers can control, document, and monitor the way that all vehicles are running, but these tasks can’t be accomplished without an effective system in place.

Tools To Help With Fleet Management

At this point, you may be wondering, what fleet and dispatch resources are available to these dispatchers to help improve the efficiency of their fleets?

There are several factors that go into fleet management – route combinations, freight tracking, fuel costs, delivery timing, driver assignments, freight bidding, regulatory management, and so much more. And to cap it off, dispatchers of fleets also have to manage several people.

Sounds like a lot right? Well, there’s good news.

While the world of fleet management is diverse and challenging for a number of reasons, more and more technology is being developed to streamline processes and improve efficiency, like fleet management software.

Now – what is fleet management software?

Web-Based Technology

Web-based fleet management systems (or software) are available for dispatchers to utilize for monitoring fleets and ensuring successful deliveries. When companies choose a platform to use, dispatchers and other employees are able to gain access to a lot of different information. This includes:

  • The location of assets in real-time via GPS 
  • Route performance data, such as out-of-route mileage, unplanned stops, delays, or breakdowns
  • Maintenance monitoring and scheduled inspection and repair intervals
  • Automated load and route planning using artificial intelligence to optimize efficiency
  • Connection to 3rd-party shipping providers via competitive bidding and tendering platforms
  • Driver logs, paperwork and manifest creation, and more

Dispatch consoles can provide you with all of this information from a single platform. You can track order attributes and handling requirements on a single web-based platform. For added convenience, web applications are typically compatible with multiple devices.


While having an effective fleet management system is important, it’s also important that it provides the right data to dispatchers and their teams.

When a web-based fleet management system is able to provide accurate and timely data, that data instantly becomes an integral asset for freight carriers and companies who manage freight.

With that data that can now be tracked by modern fleet management technology, dispatchers can use it to rate drivers or common carriers on performance, review average load weights, evaluate average asset utilization, track out-or-route mileage, and much more. 

Why Are These Fleet Management Tools Important?

The primary reason that many managers choose web-based fleet management is to improve the efficiency of day-to-day operations. Monitoring software gives professionals the means to understand how their fleets could be managed better. This information includes how to distribute loads and route fleets of vehicles in the most efficient way possible.

Ultimately, this impacts businesses by reducing the time spent redoing operations or running unnecessary vehicles, saving both time and money.  Not only will you not need to pay for mistakes, but you also won’t need to pay to operate unnecessary vehicles that you could condense into a smaller fleet.

Higher Productivity Levels Due to Decreased Downtime

Did you know that downtime can cost a business $9000 per minute?

Unfortunately, drivers that work with fleets often find themselves with a lot of downtime. This is usually by no fault of the operators- it’s tricky to determine how vehicles should be routed and how heavy loads should be. They may be struggling to manage only a few vehicles and therefore not using all vehicles in the best possible way.

Fleet management software solves this issue. It lets people see which vehicles are available and operational so that they can maximize the use of their time. It also helps you to figure out how to automatically route vehicles and plan loads that reduce the risk of excessive downtime. As a result, freight carriers can experience lower costs and higher profits.

More Efficient Operations Leads to Happier Customers

While fleet management software provides more efficiency from an operational standpoint and results in higher employee satisfaction, it also guarantees happier customers.

Think about it. If a customer calls about a particular freight order and your dispatchers don’t have any way of providing proof of delivery, that customer is likely to become frustrated quickly. If dispatch teams have a fleet management system that allows them to find where that order is and when it will arrive through a few clicks, customers can receive answers to their questions much quicker.

Quicker response times to customer questions about freight deliveries help provide them with peace of mind and secure the potential for future business partnerships in the future.

Optimize Your Fleet Today

So, what is fleet management?

At the most basic level, it’s a way to optimize the operations of your company’s fleets. However, it’s ultimately so much more than that. It’s a way to save time, cut costs, increase revenue, and increase customer retention.

Now that you know all about fleet management and why it’s essential to your business operations, it’s time to get started. Contact Headlight Solutions with any remaining questions that you have about managing your vehicles and to get help choosing the right technologies to fit your specific needs.