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F.A.Q.
- With the current crisis, our company is cutting costs. How can FCS help us in this situation?
FCS’s main aim is to optimize the work of your transport department. What we mean by “optimization” is to make the use of available resources more efficient, that is, for your company to spend fewer resources for every unit that it produces. Inputs are not only cash, but your vehicles, their number, staff requirements, sources of financing, and vehicle service personnel, as well as taxes, time, safety, and many other factors.
Our experience shows that for a number of reasons, the transport departments of many companies are not paid enough attention and the business processes involving a company’s fleet are often far from ideal. FCS looks for weak spots in the way the work of the transport department is organized and proposes a number of options for resolving them. The changes we propose to our clients not only save them money but also improve the quality of the servicing of their vehicles.
- Our company has a very small fleet, so we figure it’s better for us to service it ourselves. What point is there to outsource fleet management for a fleet as small as ours?
There is no lower limit on the number of cars for which it is worth considering outsourcing fleet management. The criterion for doing so is quite simple. Ask yourselves, which of two alternatives is more efficient in terms of reaching the goals your company currently has? If outsourcing is more efficient, then why not consider handing the management of your fleet, even if it consists of a single vehicle, to an outside company? The reverse is also true. If a company with a hundred or thousand vehicles has arranged everything ideally and it has achieved maximum efficiency in utilizing its fleet, why should it consider outsourcing?
We want potential clients to know that there is a company like FCS in Ukraine that is capable of competing effectively with their in-house transport departments. And competition, as we all know, is an effective stimulus to improve quality and reduce costs. In the end, the particular option your company chooses depends entirely on you.
- When should a company outsource the servicing of its fleet?
See the answer to #2. This question can be answered in a number of ways:
If your company has little experience managing a fleet or the current state of your vehicle assets is such that it is preventing your business from growing, then you clearly need, at a minimum, to consider this option. It’s quite possible that you will have a number of pleasant surprises when you do.
- In our company, the personnel who use our cars are expected to service them as well. How can FCS be effective in this situation?
If the cost of an hour of your specialist’s work is equal to an hour of your driver’s work and your employees are quite familiar with how a car runs and the standards for repair and maintenance on the car they use, the FCS grants that you might be more efficient. FCS services are useful in those circumstance when the cost of an hour of your specialist’s time is considerably higher than an hour of your driver’s time and/or when the user of the car is not a competent mechanic and not familiar with how to prevent possible breakdowns.
- In my opinion, any type of outsourcing brings with it additional costs. What do you say?
That any outsourcing will cost your company is obvious. However, whether this will be an additional cost is a different matter. Let’s use the analogy of insurance. Until you have a situation where insurance is claimed, the costs of premiums are extra expenditures that you could have avoided (that is, they are additional). But the situation changes completely—as does any assessment of it—when an insurable claim comes up.
What you need to do is assess the expenditure side of maintaining your fleet in the overall picture and separately. Then you can evaluate comparable indicators.
- What insurance companies do you work with? What is the percentage of insurance claims among your clients? What percentage of claims are paid or not paid by these insurers?
FCS works with a number of different insurers who have a good reputation and are in the top ratings of Ukrainian insurance companies.
The percentage of insurance claims our clients have varies greatly and depends on a lot of factors. Of course, we keep track of accident statistics in our clients’ fleets. But these figures are confidential information and we are not allowed to publicize them.
We help our clients get the full value of any claim in every case, without exception. Certain delays brought on by the current crisis are inevitable, but they are usually no more than 20-30 days.
- What is the point of fuel management services? What gasoline companies do you work with?
This FCS service includes selecting a fuel provider, accounting and administrating fuel cards, receiving full primary information on fuel usage on the part of both the car user and the supplier, verifying all data received, and preparing the reports necessary to deduct fuel as an expense. This service can also include issuing business travel forms with pre-trip checks and reviews of the state of the car and driver.
FCS works with those fuel suppliers who meet the requirements of our clients the best. For this purpose, we organize the necessary tender, following standard procedures.
- What other kinds of suppliers or subcontractors can FCS work with? Where are your service stations located?
As soon as a new client signs up with FCS, we evaluate their needs and run a tender to select the necessary subcontractors to handle any work that is required. The winners of these tenders can be either new suppliers or those with whom FCS is already working.
In any case, FCS is oriented towards maximally satisfying the needs of their client. How this is done is FCS’s known-how.
9. Do you offer such services as a hotline for technical assistance on the road?
FCS has its own help-line for all company clients. This is a 24/7 emergency service that can provide qualified advice about technical, legal and psychological matters—whether it is how to deal with the highway police (DAI), how to call a tow truck, or information about the nearest gas station.
Standard “assistance” is generally handled by a call center: the operator who takes your call is not specifically competent and your call could be redirected several times. The FCS line goes directly to the service manager responsible for a specific company client. This manager knows your driver, his car, and what potential problems might have arisen. This is a technical hotline with good colleagues who can offer you professional support.
- How does FCS arrange for towing? Is towing available only in Kyiv or across Ukraine?
Towing services operate through a 24-hour emergency line. FCS has a contract of partnership with towing companies across Ukraine. Whenever an emergency situation arises, the FCS dispatcher calls the technical service nearest to the site of the breakdown or accident.
- What kind of liability does FCS carry for installing poor quality parts or a poor repair job on a car?
FCS is very thorough when selecting its suppliers and service stations for automobiles and takes full responsibility before its customers for both the quality of any repair work and for the quality of any spare parts installed, materials used and fluids replaced.
- When changing tires, which brand do you select and how? Which tire shops do you work with?
FCS recommends Nokian Tires, although clients have a complete range of tires to choose from among all tire makers officially represented on the Ukrainian market, based on price, quality, availability of stock, and the opportunity to buy the same brand and size as they already use in cases where, for instance, the current tire is damaged. FCS has established a partnership with a number of leading tire shop networks in Ukraine, such as Tip-Top Service, Vianor and others.
13. How does leasing differ from borrowing?
Leasing is a financial or operational rental of machinery and equipment, transport vehicles, industrial facilities, and so on. The primary thing that distinguishes leasing from a loan is that what the client buys through a loan automatically becomes the property of that client, whereas that which a client takes under a lease is not necessarily theirs—although that option does exist (lease-to-buy contracts). Leasing generally gives the first right to buy out, that is, if the client wants to, they can decide to take ownership of the goods that they initially leased.
The difference between leasing and buying on credit is not cardinal, but there is a difference. When a company buys something on credit, it takes full responsibility for the goods as well. In a leasing situation, responsibility is determined by the terms and conditions of the leasing contract. In a leasing contract, such issues as the right or obligation of the lessee to purchase the object of the lease when the contract runs out, the obligations of the two parties in terms of servicing and utilization, and so on are often considered. The value of the goods depreciates in relation to the percentage paid out by the client and, should the client so wish, they can buy out the leased goods at a reduced price. Interest rates for loans and leases are fairly similar, although loan rates tend to be slightly higher.
14. What’s the difference between fleet management and fleet servicing?
Fleet management means running a fleet of vehicles, which generally implies administrating all the processes tied to the purchase, exploitation and replacement of corporate vehicles. In this case, the client pays FCS only a subscription fee that covers the cost of all aspects of this kind of administration.
When it comes to fleet services, the price also includes the direct cost of regular check-ups, tire rotation, car replacement and other services required by those clients who wish to plan and budget the full expenditures to maintain their fleet in advance. It should be noted, however, that fleet servicing is more costly, because of the nature of offsetting the cost of maintaining corporate vehicles against gross expenditures.
- Can FCS provide services on an ad-hoc basis, as the client needs them, with payment being after the fact, without a subscription fee?
Yes, FCS offers this kind of arrangement as well and does so on the basis of a general service agreement with the client. Payment then takes place on the basis of actual services rendered, such as, after the administration of a regular check-up, repairs or tire installation, without any monthly fees. The cost of such services is slightly higher compared to a monthly fee, but it is convenient for those clients whose mileage is not high and the requirements for their cars are relatively low.
