Understanding ROI in Telematics

 

Understanding ROI in Telematics

By Light & Medium Truck Magazine

Telematics devices can improve fuel economy and driver behavior, but a recent survey released by Donlen Corp., a fleet financing and management company, revealed a divide between some of the perceived and actual benefits. 

The survey found that those considering telematics devices have a higher expectation of fuel savings than those already using them. 

The way the return on investment and perceived benefit is always preached to fleets is in mile-per-gallon improvement. I think the perceived benefit is probably a little more than what is gained.

Another reason for the disconnect could be that the importance of fuel economy on the return on investment moves further down the line as carriers notice other benefits and savings with use.

Donlen also found a large divide between small and large fleets on acquiring the devices. Among carriers with fewer than 100 vehicles, 80% of respondents said they are not considering telematics. However, among fleets with more than 300 vehicles, 80% of respondents are either considering or already using telematics.

It’s shockingly surprising that smaller fleets aren’t even considering the devices. One would think that you could really maximize your ROI on a smaller fleet, according to “Light & Medium Truck Magazine”. 

Among those not considering telematics devices, 69% said they don’t see a business need. Only 17% cited the cost as a deterrent. 

The top reasons for investing in telematics devices among those who are using them are improved driver behavior, route productivity and fuel savings. 

While return on investment is an important factor in choosing telematics, 40% of respondents already using the devices said they did not know their ROI. That is likely because carriers aren’t reviewing the data, either because they don’t have time or because they already perceive the ROI and don’t feel it is necessary to drill down through the numbers. 

Most telematics providers don’t have access to all of a carrier’s information, such as a fleet’s fuel and maintenance expenses, so entering and reviewing the data to further identify the ROI is up to the carrier. 

To help quantify the ROI, Donlen said, carriers need to understand their reasons for using telematics and to integrate and analyze available data relevant to those reasons.  According to experts, choosing a Telematics company that not only custom builds a solution to fit the specific needs of your fleet and company objectives, but then also works with you in partnership to learn how to interpret and understand exactly what the data is telling you, is worth it’s ROI weight in gold.

Working with a company like Lynx Telematics, located in Cincinnati Ohio, is like partnering with a team, rather than purchasing from one of the endless streams of Telematics companies on the great “gold rush”.

Having worked with some of the largest fleets in the world by developing custom built solutions, Lynx Telematics as an OEM (Original Equipment Manufacturer) works equally as well with small fleets of 3-30 vehicles.

 Lynx Telematics, located in Milford Ohio, is an OEM (Original Equipment Manufacture) that specializes in developing proprietary fleet GPS Tracking devices for fleets of all sizes and functions.
For information on how Lynx Telematics can help your company save an average of $2500 per vehicle annually, contact Business Development Manager, VincentRush at (513) 965-6318

Lynx Telematics is an OEM that controls design, engineering, firmware, software development, IT support and manufacturing processes of our product, allowing us to produce the highest quality product in our industry, while offering our customers competitive pricing.

As your partner, we provide ongoing training and support to insure that the product is properly sold to the end user, maximizing the re-sellers profitability.

As one of the pioneers in telematics technologies, Lynx Telematics provides our clients with powerful end-to-end vehicle telematics tools. Our technology offers a real solution that delivers safety, saves money and provides an unprecedented level of peace of mind to our customers.